In a significant move, Yes Bank has laid off 500 employees as part of its latest restructuring exercise. This decision aims to enhance operational efficiency and reduce costs, focusing on a leaner and more agile organizational structure. This article delves into the details of the layoffs, the bank's strategy, and its potential impact on the workforce and future operations.
The Layoff Details
Yes Bank has terminated 500 employees across various segments, including wholesale, retail, and branch banking. The layoffs were guided by a multinational consultant, ensuring that the bank's restructuring plan was thorough and effective. Employees affected by the layoffs have been provided with a severance package equivalent to three months' salary.
Reasons Behind the Layoffs
According to a spokesperson from Yes Bank, the primary goal is to become an agile, future-ready organization. By optimizing its workforce, the bank aims to be leaner, faster, and more customer-centric. This restructuring is also in response to the significant increase in staff expenses, which grew by over 12% between fiscal years 2023 and 2024, rising from Rs 3,363 crore to Rs 3,774 crore.
Cost-Cutting Measures
Yes Bank is shifting its focus towards digital banking to reduce manual intervention and cut costs. This strategic move is expected to streamline operations and improve efficiency, helping the bank manage its resources more effectively.
Historical Context
This isn't the first time Yes Bank has undergone such a restructuring. In 2020, the bank conducted a similar exercise under the leadership of its current Managing Director, Prashant Kumar, following the Reserve Bank of India's intervention to save the bank from a financial crisis.
Stock Market Reaction
Despite the layoffs, Yes Bank's stock remained relatively stable, closing at Rs 24.02 on Tuesday against the previous close of Rs 23.95 on the BSE. The market capitalization of the bank stands at Rs 75,268 crore.
Yes Bank's decision to lay off 500 employees is a significant step towards its goal of becoming a more efficient and customer-focused organization. By embracing digital banking and optimizing its workforce, the bank aims to navigate its financial challenges and position itself for future growth.
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