Banks continue cutting staff salaries amid economic difficulties
Banks continue cutting staff salaries amid economic difficulties
Both small and big banks have continued slashing salaries and bonuses for their staff due to their loss-making in the context of the current economic difficulties which are affecting their operations.
Asia Commercial Bank (ACB) spent only VND597.7 billion (USD28.4 million) on salaries and bonuses for their staff in the first half of this year, down 30% from the same period of 2012.
During this year-long period, the bank posted a pre-tax profit of VND943.7 billion (USD44.9 million), fulfilling only 52.4% of the year’s target of VND1.8 trillion (USD85.72 million). Meanwhile, the bank’s bad debt rate has continued rising and is now at 2.97%, compared to 2.46% earlier this year.
Nam Viet Commercial Joint Stock Bank, which reported a loss of VND11.3 billion (USD538,095) in the second quarter of 2013, cut its salary fund to a mere VND84.93 billion (USD4.1 million) by late June this year from VND128.78 billion (USD6..1 million) a year ago, equal to a fall of 34%.
According to the second-quarter financial report of An Binh Commercial Joint Stock Bank, the bank cut 5.8% of its spending on salary and bonuses to VND167.4 billion (USD7.9 million) in the first half this year.
A big bank headquartered in HCM City has reduced 30% of salary and bonuses for their staff as a way to cut its costs, because it fulfilled less than 60% of the year’s profit target. All its managers of different boards have had their salaries cut by 15%.
Besides slashing salaries, banks have tended to recruit more business contributors to lower its human resources costs. Unlike official staff members, these contributors are not provided with fixed salary, but rather just a very small salary ; instead, they are paid according to their contributions, such as the number of customers they attract for banks.
Contributors are required to have passed high-school graduation exams and be aged below 50. In some cases, though, they are not limited by their age.
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