In the past few years, city banks had reduced staff to cope with deteriorating business conditions stemming from the burst of the financial bubble. On top of this, it is expected that some financial institutions will show a huge loss due to large provisions for bad loans. In addition, some banks adopted an in-depth policy of reducing their workforce in order to thwart an avalanche of criticism against the government's plan to use taxpayers' money to help liquidate the failed jusen.
Dai-ichi Kangyo Bank will slash its workforce by 2,000 in the 4 year period starting in fiscal 1996 to 17,000. Sakura Bank will reduce its payroll by 1,200 workers in 1996 to a workforce of 19,300 by March 1997. The Bank of Tokyo and Mitsubishi Bank, which merged in April, plan to shrink their giant workforce by 1,000 people over the coming year and by a maximum of 3,000 people over the next three years, from 20,000, at the time of merger. Furthermore, Sumitomo Bank, Fuji Bank, Tokai Bank and Asahi Bank will all proceed with restructuring plans. In its 5-year plan to reduce workers by 1,000 which started in 1993, Hokkaido Takushoku Bank has begun to study a possible decrease of 500-600 more jobs in the following two-year period to slim down in later years. Daiwa Bank which has withdrawn from the U.S. will cut its staffs from the present 9,635 at the end of September 1995 to 7,000 over the next four years. However, none of these banks are taking such drastic measures as dismissal, to reduce staff. Instead, they will restructure by natural attrition, constraints on new hiring and farming-out of some operations to other companies. Further reduction of bank staffs will worsen the market for banking jobs.
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