Jobs in jeopardy
Scotiabank to close 120 branches; 35 in the caribbean
Scotiabank employees in Barbados are waiting to see which among them, if any, will go on the breadline as the company moves to close 120 branches and sever 1,500 workers across its network.
The Canadian-based financial institution announced today that operations in the Caribbean and Mexico would be the hardest hit in an effort to save CAN$120 million (BDS$210 million) annually.
About 35 of its 200 branches in the Caribbean are to be closed and the bank said 500 of the 1,500 employees to be severed will come from the bank’s international operations.
Scotiabank has seven branches in Barbados, but marketing manager in the office of the managing director Amanda Lynch-Foster told Barbados TODAY that a decision has not yet been taken on how many branches would be affected here or how many people would lose their jobs.
“We are still undergoing a review and this will take some time. We don’t have detailed information as yet on how or if it is going to impact us locally or in what areas. As we move forward over the coming months we will continue to provide our employees and customers with more information, but we don’t have a timeline yet because there are still discussions that are going on,” she said.
Scotiabank said the closure of the Caribbean branches were due to “the prolonged economic recovery and continued uncertain outlook”.
The bank said it had started restructuring initiatives “in order to improve the speed and quality of service it provides its customers, to reduce costs in a sustainable manner, and to achieve greater operational efficiencies”.
Chief executive officer Brian Porter said that in some Caribbean countries, the bank simply has too many branches and “we have to size it to the economic realities of these economies”.
Porter said that while the bank’s revenue growth had been encouraging outside Canada, profit had not jumped as much as he would like.
Scotiabank made a record CAN$6.7 billion (BDS$11.7 billion) net income in 2013.
“The frustration for us across the international footprint is we’ve had very solid asset growth over the last three or four years, and not all of that has dropped to the bottom line,” he said, adding that the bank still had plans to grow in the region.
“The bank intends to record a restructuring provision of approximately CAN$148 million (BDS$260 million) in the fourth quarter. The majority of the restructuring provision relates to employee severance charges in the bank’s Canadian banking and international banking divisions and will affect people at all levels of the organization.”
The changes will allow Scotiabank to “focus on high-growth markets, minimize branch overlap, and realize synergies resulting from recent acquisitions”, the bank said in its statement.