The Financial Gazette

Staff Reporter

THE government has sanctioned a proposal by the former Interfin Merchant Bank Limited to shed excess staff in response to the dynamics in the financial services sector, The Financial Gazette can report.

Interfin, which has since transmuted into Interfin Banking Corporation, had sought authority from the Ministry of Labour to lay off 36 employees in order to contain overheads.
At the time, industry players were trimming excess fat to maintain a healthy balance between costs and income.
Among the big players that retrenched staff are Barclays Bank, Standard Chartered Bank, Stanbic Bank, ZB Bank and Kingdom Bank.
What triggered the industry-wide streamlining of operations was the painful economic recession that had a knock-on effect on banks, which responded by re-aligning their costs to sustainable levels.
Although the worst is over, the sector is still going through a lean spell due to liquidity challenges. Liquidity has remained at low levels with the volume of deposits and their transient form militating against the intermediary role of the industry.
In clearing the way for the bank to retrench, the Ministry of Labour wrote last month:
“It is hereby notified that the Minister of Labour and Social Welfare, in terms of Section C of the Act, has considered the proposal of Interfin Merchant Bank of Zimbabwe Limited to retrench the employee(s) whose names are listed in Annexure 1 to this form on 24 August 2010 (date on which retrenchment is to take effect) and (a) has approved the proposed retrenchment, subject to the terms and conditions, which are listed in annexure two of this form.”
The approved package includes a service pay, severance pay, a stabilisation allowance and medical aid cover.
Interfin now operates a retail bank after securing a commercial banking license from the central bank in March 2009.
The bank has since swooped on the assets of CFX to roll out its branch network after the Interfin group gained a controlling stake in CFX last year after underwriting its US$10 million rights issue.
This resulted in the reverse takeover of CFX by Interfin and the latter was subsequently listed on the local bourse in April.

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