Banks shed 1,200 jobs in Q1

Pandemic pushes banks to cut more jobs, while hiring more nonregular employees to save cost

  • Published : Jun 1, 2021 - 15:24
  • Updated : Jun 1, 2021 - 15:27
South Korea's financial district of Yeouido in western Seoul (Reuters-Yonhap)
South Korea’s major commercial banks cut over 1,200 jobs in the first three months of the year, as the bruising COVID-19 pandemic pushed them toward online- and mobile-focused services, data showed Tuesday.

The combined size of the workforce of major commercial lenders here shed 1.8 percent or 1,244 jobs in the first quarter compared with the last three months of 2020, according to an online data system operated by the Korea Federation of Banks. The total number of executives and employees stood at 66,317 as of end-March.

However, firms hired more nonregular employees, those with term contracts or part-time workers, in the three-month period, while permanent employees continued to leave.

Banks hired 148 more nonregular employees in the first-quarter compared with the last three months of 2020. The pool gained 3.3 percent on-quarter to reach 4,595 employees. The number of regular employees declined 2.2 percent or 1,395 jobs to 61,517 in the same period.

The firms also hired three more executives on-quarter in the first three months of the year, with the executive-level pool standing at 205 as of end-March.

Even as banks have come under increasing pressure to shed jobs and shut down brick-and-mortar branches due to digitalization, the pandemic has apparently kicked the momentum into high gear.

The figure in the first three months of this year alone accounted for half of the total jobs shed from 2018 to end-2020, or 2,077, in the banking sector.

Banks have been offering early retirement options for its employees and executives since last year, to save cost against the pandemic woes. So far this year, some 2,500 employees -- both those who will soon reach, or have reached the retirement age of 60 -- have reportedly accepted the severance package, which is 748 more than 1,737 that applied for the option last year.

The KFB represents 22 full members, including major commercial banks and state-run lenders, as well as 36 associate members, which are mostly branches of foreign banks operating here. Internet-only banks KakaoBank and K bank are also members of the federation.

By Jung Min-kyung (
헤럴드 에듀