Troubled BOQ in cost-cutting drive
Caroline Henshaw Dow Jones Newswires The Australian September 07, 2012
THE Bank of Queensland will cut about 100 jobs by the end of the year, its chief operating officer said today.
The bank is cutting costs as it battles slowing credit growth and continuing weakness in Queensland's property markets.
"We have done this to make Bank of Queensland more customer-focused, more efficient, more competitive and ultimately more sustainable," chief operating officer Jon Sutton told Dow Jones Newswires. "Overwhelmingly, staff affected will come from middle management and back-office functions."
Layoffs will affect less than 10 per cent of the bank's 1,400-strong workforce and it won't outsource jobs offshore, Mr Sutton said. It will expand its call center in Brisbane.
Australia's banks are trying to boost business as credit growth has stalled and rising wholesale funding and deposit costs have crimped margins.
Bank of Queensland has been hit particularly hard by falling house and commercial-property prices in its home state. The bank reported a loss of $91 million in the six months to the end of February after provisions for bad debts soared to almost $200 million.
Chief executive Stuart Grimshaw in March announced a $450 million capital raising to reduce bad debts and improve earnings.
It offloaded some of its impaired-property portfolio to Goldman Sachs Group last month for 38c in the dollar.