Yes Bank, a private sector lender, has laid off at least 500 employees as part of a restructuring effort aimed at cutting costs. This move, which could lead to more layoffs, affects various departments, especially the branch banking segment. The laid-off employees are receiving severance pay equal to three months’ salary.
Restructuring and Cost-Cutting:
Yes Bank has started this restructuring based on advice from a multinational consultant. The bank aims to become more efficient and customer-focused by optimizing its workforce. A spokesperson for the bank stated, “We periodically review our operations to ensure we are leaner, faster, and more customer-centric.”
Shift Towards Digital Banking:
Sources indicate that Yes Bank is focusing on digital banking to reduce manual processes and cut operating expenses. In the last financial year, the bank’s operating expenses increased by nearly 17%, with staff expenses growing by over 12%. By the end of FY24, Yes Bank had around 28,000 employees, adding 484 new hires in one year.
Historical Context and Future Outlook:
This is not the first time Yes Bank has undergone such an exercise. After Prashant Kumar became managing director in 2020, following a Reserve Bank of India-led rescue, many senior staff left the bank.
This layoff is significant as Yes Bank is the first private sector bank in several years to undertake such measures, while other private banks have been hiring. Despite its efforts, Yes Bank has struggled to improve its operating profits, which grew by 6.4% to Rs 3,386 crore at the end of FY24 from Rs 3,183 crore the previous year.
Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.
