The number of people employed by the UAE banks surprisingly increased in the month of March 2020 as compared to previous months despite the advent of Coronavirus pandemic.
Official data showed that foreign banks recruited more people while, on the contrary, national banks reduced their workforce. Foreign banks increased their workforce by 21 per cent month on month while national banks laid off 3.6 per cent of their employees.
The total number of employees working in the UAE banking sector increased by 201 to 35,838 month on month in March 2020. National banks slashed the number of workers by 1,046 while foreign banks increased their workforce by 1,283 from 5,964 in February to 7,247, according to the Central Bank figures.
Data showed that the number of employees working with the foreign banks have been consistently on the rise on quarterly basis since March 2018. Banking sources said locals banks reduced manpower after they were hit by the Covid-19 impact, hence, reducing the number of branches as well.
While foreign banks increased the number of people mainly in the recovery and collection departments to maximise the recovery of loans. In addition, the outbreak of the pandemic has massively increased the focus of the banks and customers from brick-and-mortar to digital banking.
National banks reduced their number of branches to 640, shutting down five of them. While foreign banks maintained their branch network at 27 in the country. Meanwhile, Moody's expects the UAE's coronavirus pandemic-related containment actions, the broader global economic shock, significant drop in oil prices and a pre-existing cyclical and structural slowdown in the non-oil economy to materially weaken banks' asset quality and profitability. It said borrowers in wholesale and retail trade, construction, real estate, transportation and storage, and accommodation and services sectors are apt to be the most affected, with SMEs particularly vulnerable to the economic shocks.
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