Barclays Bank has cancelled the end of the year staff party, in a move it says is aimed at containing and managing costs after a poor performing year.
In a memo to staff, the lender said it has faced a lot of challenges during the past year resulting in performance that is not satisfactory both in terms of business output and profit maximisation.
“Given the situation, the business has decided to focus on containing and managing cost for the remainder of the year and scale up our 2017 focus in terms (of) deposit growth, segmentation of customers propositions and drive our performance,” the memo from the bank’s management committee read in part.
It added: With this regard, we officially announced that the 2016 End of Year Party has been cancelled and we look forward to a positive business performance so as to hold the event in future.”
Awards and recognition of notable staff will be done in the first quarter of 2017.
The announcement came barely a day after the bank announced its net earnings in nine months through September, which indicated a 5.31 per cent profit drop.
It posted Sh6.06 billion compared to Sh6.40 billion for the same period last year, attributing the drop to increased operating costs and provisions for bad debt. This increased to 24.66 and 45.86 per cent, respectively, year-on-year.
Operating costs increased to Sh15.72 billion from Sh12.61 billion last year while provision for bad debts jumped to Sh4.58 billion against loan defaults from Sh3.14 billion last year.
Barclays Bank, which lies fifth among the country’s lenders, is the first first-tier bank to report reduced performance.
Equity Bank, the country’s largest bank by customer base, recorded a 17 per cent rise in profits while Kenya Commercial Bank, the largest on account of assets, announced a 15 percent increase.
However, the banking industry is grappling with many challenges, the latest being the cap on interest rates.
Most banks have begun embracing digital technology to reduce costs and up to 1,000 staff have been retrenched in three months.