Maybank Kim Eng lays off 5% of its Singapore workforce

It says it 'cannot ignore' the global market forces that forced staff-strength review

Tue, Dec 10, 2019

MARISSA LEE


MAYBANK Kim Eng, the investment banking and securities broking arm of Malaysia's largest bank, has laid off 5 per cent of its Singapore workforce as stiffer competition prompts a restructuring of its Singapore retail brokerage operations.

The job cuts were announced last Friday in an internal memo seen by The Business Times, and are part of a broader review of staff strength that also affected Maybank KE's regional institutional sales and research, and Hong Kong investment banking and advisory businesses.

Maybank KE is estimated to have some 2,000 full-time employees, most of them in South-east Asia. The review trimmed its total workforce by 3 per cent, the memo said.

In Singapore, BT understands that Maybank KE had a headcount of around 600, comprising some 400 full-time employees as well as self-employed remisiers. This would mean that some 30 positions here were axed.

Sources told BT that some back office staff have been let go, though no remisiers were affected by the latest exercise.

The layoffs come as the broking industry struggles with fading retail interest in the Singapore market and the rise of passive funds, plus a painful race towards ever-lower trading commissions. Maybank KE is the 15th largest broker in Singapore with a 3.38 per cent market share.

A Maybank KE spokesman told BT in an e-mailed statement on Monday: "The investment banking landscape has evolved dramatically over the last few years due to shifts in customer preferences and dynamic changes in the markets. These include the increasing automation and digitalisation of brokerage offerings, as well as changes in the regulatory environment.

"The comprehensive restructuring of MKE's cost structure and existing operating model will enable MKE to leverage emerging opportunities in new growth areas. The affected business lines will remain key to MKE's operations and are essential components of the investment bank's growth aspirations."

In the nine months ended Sept 30, Maybank's investment banking division reported a pre-tax loss of 7.3 million ringgit (S$2.4 million), compared to a pre-tax profit of 227.4 million ringgit in the same period last year.

Net operating income was 814 million ringgit (S$266 million), down from 980 million ringgit in the first nine months of 2018.

The Singapore team's contribution to group income shrank by close to 28 per cent over that period, though Singapore continues to be Maybank KE's biggest income generator outside of Malaysia.

In the memo to staff last Friday, Maybank KE group chief executive officer Ami Moris said that the group will provide support to affected staff, including offering outplacement advice and referrals: "Decisions that affect our people's lives in this way are never easy to make. These decisions, on our portfolio of products and solutions, are based on global market forces that we cannot ignore."

In January, Maybank KE closed its Hong Kong and China institutional equity research business to focus on its core market of South-east Asia, Reuters reported.

In March, Maybank KE told BT that it would convert no more than 10 per cent of its fixed-desk remisiers here into mobile trading reps in order to "optimise resources".

This conversion is ongoing, sources said. In any case, remisiers who work remotely have "substantially similar employment terms" to their fixed-desk counterparts, the group said previously.