Oct 2009 Financial News

NCB to close five of nine agencies - To redeploy employees

Oct 09, 2009

National Commercial Bank of Jamaica Limited (NCB), come mid-October will shutter five of nine agencies or sub-branches - four in rural Jamaica and one in Kingston - consolidating the operations into their larger full-service branches in nearby towns.

The bank says, however, that no one will be out of work as a result.

In what NCB describes as a move towards improving operational efficiencies across its branch network, the Buff Bay agency will merge with the Annotto Bay branch; Lionel Town with May Pen in Clarendon; Grange Hill with Savanna-la-Mar in Westmoreland; Spanish Town Road with Hagley Park Road in Kingston; and Yallahs with the Morant Bay operation in St Thomas.

The October 16 closures, which come at a time that the bank is making record profit, will cut the banking network to 42 branches and four agencies.

Profitable but cautious

Dennis Cohen, NCB deputy group managing director, refused to disclose the savings to be realised by the move, but said it was being done "in the best interest" of the bank's stakeholders.

It appears, however, that much of the savings will be in overheads, given that staff are to be redeployed.

"Notwithstanding the fact that we are achieving record profits, the current economic climate demands that we aggressively maintain the highest level of operational efficiency in order to consistently meet and exceed our targets," said Cohen.

Indeed, NCB has, since 2002, consistently grown profits from a lowly $1.5 billion then to $8.7 billion in 2008.

The bank, whose total assets top all other rivals, cresting $311 billion at the end of June, is again on track for another record year of profit which appears set to come out just shy of $10 billion based on its its nine-month earnings of $7.34 billion.

Scaling back

Still the bank is scaling back its network, which, with 166 ABMs is the largest in Jamaica, even as customer deposits are on the rise - growing by $23.5 billion to $132.7 billion in the year ending June 2009.

"It is common for us to continually evaluate the performance of all our business lines," said Cohen.

"Where improvements can be achieved from merged, expanded or alternative service-delivery options, we have and will always pursue these."

The banker said no worker will be cut, saying that all staff displaced are likely to be absorbed in the larger branches to which business will be moved.

"We expect that service delivery at the parent branches will need, at the very least, to be maintained, if not improved, so additional resources may be required as a result of the mergers," said Cohen.

"We are, therefore, retaining the agency employees with a view to determining what level of impact on service delivery, if any, may result in the parent branches."

It is estimated by the bank that some 145 transactions were done daily at each of the agencies to be closed, including cash withdrawals, bill payments and deposits.

NCB states that agencies are smaller-run operations that do not offer the full range of banking and financial services that branches do, such as investment and insurance options. Instead, they primarily process savings withdrawals, cheque enchashment, bill payments and deposits.

In areas where agencies have been closed, the bank's clients will still have access to ABMs within the environs of the closed agencies, said Audrey Tugwell Henry, senior general manager, NCB Retail Banking Division, in a company release on the closures.

NCB agencies remain open at Windward Road in Kingston, Bay West Shopping Centre and Barnett Street in Montego Bay, and at Spaldings in Clarendon.


Source:
Avia Collinder, Business Reporter
avia.collinder@gleanerjm.com
Jamaica Gleaner
Friday October 9, 2009

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