Yes Bank Layoffs: 500 Employees Laid Off, More Layoffs Expected

Yes Bank Layoffs: Yes Bank has initiated a significant internal restructuring exercise, resulting in the layoff of 500 employees, with more expected in the coming weeks, according to a report by The Economic Times.

The layoffs have affected employees across multiple verticals, including wholesale, retail, and particularly the branch banking segment.

Yes Bank Layoffs Severance and Current Industry Trends:

All affected employees have been given three months of severance pay. This move comes at a time when most private lenders are expanding their workforce and hiring more employees, highlighting a contrasting strategy by Yes Bank.

The restructuring exercise, advised by a multinational consultant, aims to improve efficiency and decrease operating costs. Yes Bank’s operating expenses had increased by 17% last year, with the bank spending ₹3,774 crore on its staff by the end of the last financial year. The bank had 28,000 employees at the end of FY24, with 484 new hires in one year. Notably, 23,000 of these employees were in junior management.

Financial Performance and Digital Transformation:

Despite the increase in operating expenses, Yes Bank’s operating profits only grew by 6.4%, from ₹3,183 crore to ₹3,386 crore in FY24. With SBI as its biggest shareholder, Yes Bank is striving to improve its financial performance by reducing costs and moving towards digital banking to minimize manual intervention.

Official Statement on Yes Bank Layoffs:

A spokesperson for Yes Bank told The Economic Times, “In our endeavour to be an agile, future-ready organisation which is leaner, faster, customer centric, and operationally efficient, we periodically undertake a thorough review of the way we operate and optimise our workforce.” They added, “We are committed to delivering the best of our banking services to our customers and deliver the full potential of the bank to our stakeholders.”

Yes Bank underwent a similar restructuring exercise in 2020 when Managing Director Prashant Kumar took over with the support of the RBI to prevent the company from going under. During that period, many senior staff members left the bank.

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