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New Zealand building costs expected to moderate from highs

Tuesday 17th October 2017

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Bank of New Zealand is reviewing staff levels at some branches and is in talks with workers as part of a drive to adopt new digital technology in an environment where more customers are doing their banking online. 

First Union said more than 100 jobs may go in what it describes as a "massive" restructure of BNZ's branch network, with reduced hours and positions slated in more than 30 branches, it said in a statement. That equates to 2 percent of BNZ's workforce of about 5,000 full-time equivalents. The lender's personnel costs rose 6 percent to $452 million in the year ended Sept. 30, 2016. 

"It’s appalling that a wildly profitable bank like BNZ is looking to put so many people out of work," First Union spokeswoman Tali Williams said. "This isn’t just devastating for those staff who may lose their jobs but it’ll impact customers as well. When jobs go customer service suffers." 

BNZ and its peers have been boosting their online channels in recent years as consumers grow more comfortable about transacting online, letting them pare back an expensive physical network of branches. BNZ had 161 retail branches as at March 31, down from 173 a year earlier, while at the same time automatic teller machines increased to 488 from 479 and internet banking customers climbed to 745,000 from 705,000 in March 2016.

That's seen a heavy investment in software development, and the bank attributed a $261 million value on goodwill and other intangible assets as at June 30, up from $187 million a year earlier. 

A BNZ spokeswoman said those changes spurred the lender to look at the make-up of its staff and skills. 

"For some this means there are change proposals that are being discussed," she said. "We can’t go into detail on what that might be, as we need to let the proper consultation process take place with our people in the first instance."

New Zealand's finance and insurance industries account for about 3 percent of the workforce, or 75,300 as at June 30, the highest number of people the sector's employed since the data started being collected in 2003. 


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