Banks' wage bills grow as they add 849 staff in a year

By Gareth Vaughan

ASB says 346 additional staff, and greater use of contractors, are the reasons behind a NZ$44 million, or 16%,  year-on-year increase in its salary and "other staff expenses" bill.

The increase, to NZ$314 million in the nine months to March 31 from NZ$270 million in the same period of the bank's previous financial year, was revealed in ASB's latest General Disclosure Statement (GDS).

John Barclay, ASB's chief human resources officer, told interest.co.nz in an emailed response that the bank was investing strongly in its business.

"So staff costs have increased as we employ and contract additional permanent employees," Barclay said.

"In addition to increased short-term resource requirements for projects, new people are required to provide the resource we need for our nationwide branch expansion programme and other customer service initiatives such as the ASB Virtual Branch (which the bank claimed as a world first). As at 31 March, ASB Bank's total staff numbers stood at 4,894, up 346 from the previous March. Contractor numbers also increased."

Other banks lifting staff numbers too as lending contracts

ASB is not the only bank that has been increasing staff numbers despite flat or falling lending growth. Westpac, the only other of the big four banks to have released its March quarter GDS so far, said salaries and other staff expenses rose by NZ$21 million, or 12%, to NZ$194 million in the six months to March from the same period of the previous year driven largely by an increase in frontline bankers. Westpac says it has 474 accredited business bankers and 1,158 accredited retail bankers.

"This investment is part of the bank's focus on delivering service excellence to customers in their local community, which also included the opening of two new community branches during the six months ended March 31, 2011 on top of the eight opened in the 2010 financial year," Westpac said.

KPMG's recently released annual Financial Institutions Performance Survey, covering 2010, noted overall bank employee numbers rose by 849 during the year. The biggest contributor to the increase was ANZ which added 234 staff. Next was BNZ with 219 additional workers. Total staff across all registered banks numbered 24,967, KPMG said.

Rural lender Rabobank added 42 staff, reflecting it accounting for nearly 65% of new rural lending last year.

"As other banks withdrew from the sector because of concerns about overexposure, Rabobank stepped in," KPMG said.

Overall KPMG said bank branch numbers across the country dropped by 10 to 1,217 last year, with Kiwibank shutting nine leaving it with 302.

Meanwhile, ASB's March quarter GDS also reveals that the bank paid its Australian parent, Commonwealth Bank of Australia, a NZ$200 million dividend in April and its lending contracted. See our earlier article here.

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