SEOUL, January 21 (AJP) - South Korea's five largest banks are set to shed more than 2,000 jobs this year through voluntary retirement programs, a 20 percent increase from the 1,967 departures recorded in 2024, as they accelerate digital transformation and reduce physical branch networks.
KB Kookmin has already approved 647 voluntary retirements as of Jan. 17, while Shinhan confirmed 541 departures - more than double the 234 recorded last year. Woori anticipates around 500 employees will exit, up from 362 in 2024, and NH Nonghyup reported 391 departures.
For the first time, banks are extending eligibility to younger employees. Shinhan’s program includes workers born as recently as 1986, signaling a shift in workforce strategy. Average retirement packages range from 380 million won to 402 million won ($285,000 to $302,000), with some payouts reaching up to 1 billion won ($750,000).
The push to downsize coincides with a rise in the productivity of online banks. In the third quarter of 2024, South Korea’s three major online banks reported an average profit of 562 million won per employee - more than double the 255 million won seen at traditional banks.
“While the average age of applicants remains consistent with previous years, we’re seeing a notable increase in applications from employees in their late 30s to early 40s,” said an official at one bank, highlighting shifting attitudes toward banking as a lifelong career.
KB Kookmin expanded its retirement package to offer 31 months of salary, up from 30 months, with a focus on middle managers in their 40s and 50s.
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