Fresh information confirming imminent job losses at National Development Bank (NDB) has surfaced.
The bank, through its Director of Branding, Marketing and Communications, Harry Marks has also not denied that a sizeable number of employees at the troubled bank will lose their jobs.
Marks says following the adoption of a the bank’s turnaround strategy in 2015 and after incurring some financial losses, the bank has found it in increasingly challenging to emerge from a loss making position due to many factors.
As a result, the bank is said to have moved swiftly during the current financial year (2018/19) to adopt a revised turnaround strategy to address issues of sustainability and profitability in preparation for both commercialisation and ultimately privatisation.
“We have not yet established how many head-counts will be affected and the intension is to move employees around depending on their skills,” Marks said.
He emphasized that the bank needs to reduce cost to income ratio quite significantly which could easily be achieved through optimising all resources including staff commensurate with the current decreasing balance sheet.
Sunday Standard has been informed that already NDB has conducted preliminary interactions with key stakeholders amongst them workers union as per the requirements of the Employment Act.
Apart from laying-off workers, Marks says NDB needs serious intervention to turnaround which could be fastened by sourcing of cheaper funds in capital markets as well as funding through recapitalisation of the bank by the shareholder.
He noted that the loss making position of the bank was brought upon by amongst other things – increasing impairments as result of non-performing loans due to the economic downturn, droughts and diseases which affect customers’ ability to repay as the Bank’s main focus has been on risky ventures such as start-ups and agric projects.