Barclays sees more jobs under automation cloud


Barclays Bank Kenya MD Jeremy Awori
Barclays Bank Kenya MD Jeremy Awori

In Summary

  • The lender who closed down a total of 7 banking outlets across 2018 insisted on the closure’s muted effect on the bank’s workforce to suggest an inverted outcome to its branch optimization undertaking.
  • Barclays like its peers has in the past year implemented a combined business multiplication strategy defined largely by the digitization of products and services to ease work flows and provide checks to bank’s operational costs.

Barclays Bank Kenya (BBK) expects to see the creation of additional jobs to directly account for roles lost to automation, alleviating noteworthy concerns over the safety of jobs in the country’s banking scene.

The lender, who closed down a total of 7 banking outlets across 2018, insisted on the closure’s muted effect on the bank’s workforce to suggest an inverted outcome to its branch optimization routine.

“What you will probably find is as we grow our business, we are more likely to create more senior jobs and automation will only come in to take out the more repetitive manual-type jobs,” BBK Chief Executive Officer Jeremy Awori told Citizen Digital.

Awori, who spoke on the sidelines of the Group’s investor update on Monday, further confronted the analogies associating branch closures with job losses to instead lobby players in the sector to facilitate skills transfer to redundant employees to better their chances at emerging roles in the banking firms.

“Are we developing enough of the new skills for the growth? Or do we keep poaching professions from each other to drive up the cost of wages?” Mr. Awori posed.

Barclays like its peers has in the past year implemented a combined business multiplication strategy defined largely by the digitization of products and services to ease work flows and provide checks to bank’s operational costs.

The bank has in the first year to its half-a-decade strategic plan roll-out successfully employed optimization and innovation to increase digital transactions and cut down on staff costs.

Barclay’s for instance marked an improvement in its cost to income ratio (CIR) which came down 4.1 percent to stand at 51.4 percent for the year ending December 31, 2018 from 55.5 percent in 2017 with staff costs reducing to Ksh.9.7 billion from Ksh.10.1 billion.

Meanwhile, investments in alternative channels to drive efficiency and better customer experience pushed out 29 percent of the bank’s transactions from the branch in 2018 to raise the volume of transactions by agents/point of sale purchases (POS), digital and automated teller machines (ATMs) to 70 percent from 41 percent in 2017.

In comparison, KCB bank who last Wednesday announced a 22 percent growth in profit after tax (PAT) also grew its share of non-branch transactions to 88 percent as branch teller transactions shrunk to 12 percent from 16 percent as at December 2017.

Cost cutting and innovation remains the primary focus of Barclays ahead of its scheduled transition into the Absa Group family by mid-year 2020.

The bank has already incurred a one off payoff of Ksh. 274 million shillings to foot the alteration charges and is expected to raise additional capital from its shareholders to clear outstanding amounts.

“We are going to get support from our majority shareholder-the Absa Group. One way of going about this is to have the group  part with a portion of their declared dividend payout to fund the separation cost,” Barclays Chief Financial Officer (CFO) Yusuf Omari said.

BBK transition into the Absa brand is now 50 percent complete according to the lender’s senior management. However it will take up to the fourth quarter of the year to begin seeing a rapid and outward manifestation of the Absa brand according to the lender’s C.E.O. Jeremy Awori.

Barclays Kenya began the transformation journey into Absa at the start of 2018 as a direct result of Barclays PLC (London) overhaul of its African subsidiary to become a minority partaker in the business passing the leadership mantle to the Absa Group (South Africa) holding company.

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Story By Kepha Muiruri
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