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Banks will soon layoff employees due to surplus laobr increasing as more work has been taken over by computers. Reductions in labor are to be undertaken in order for banks to prepare for future financial restructuring and to raise competitiveness.

To create a shift in generation, banks are encouraging a large number of high-ranking executives to retire early. Korea First Bank will have 226 personal retire on April 26. The bank stated its policy saying that an employee who was born before 1945 would have serious disadvantages in gaining promotion if not registering for early retirement this time.

Concerning Kookmin Bank, the management board and labor unions are negoitating for a large-scale layoff at the end of this month. Lee Jae-chun, a head of the labor union at Kookmin Bank, stated that if the management board accepts labor union‘s proposal for compensation at the same level as at Korea First Bank more than 1,000 employee will retire. Seoul Bank, decided to be managed by Deutche Bank, and will reduce its numbers by around 1,000 employees this year. Kwang Ju Bank will lay off 150 employees, which is 10 percent of its total employees.

The banking sector believes that domestic banks will reduce their labour force by at least 10,000 people to improve company structure, around 10 percent of total employees in the domestic banking sector.

Concerning Korea First Bank, a consulting firm, Bain and Company, last year gave professional advice for a decrease in the number of employees from the current 4,833 to 3,730. Kookmin Bank was urged by one of its largest shareholders, Goldman Sachs, to lay off a few thousand employees according to an official at the Financial Supervisory Service.

The number of layoffs will depend primarily on a second financial restructuring which will soon become apparant. If mergers between domestic commercial banks are made, as the Korean government intends, the total number of layoffs will increase.