This article first appeared in The Edge Financial Daily on February 27, 2018

KUALA LUMPUR: Hong Leong Bank Bhd (HLBB) expects its headcount to come down further as it focuses on the digitisation of its service offerings.

Its chief financial officer Foong Pik Yee said the group has witnessed its staff force fall 5% on a year-on-year basis.

“We have managed to reduce our workforce both from the acquisition front line and back office processing largely due to our digitisation efforts,” she told a media briefing yesterday.

She assured that the future reduction of workforce will be through natural attrition.

According to its sustainability report for financial year 2017 (FY17), HLBB’s total employee number stood at 8,212, of which 7,672 were permanent staff and 540 were contract staff.

Foong also said the group will continue to invest for growth and business efficiencies moving forward.

“Out of the RM65 million approved capital expenditure today, half is for digitisation and business growth-related. The estimated savings from digitisation efforts are about 3% reduction in the group’s operating expenditure,” she added.

Foong also said HLBB aims to lower its cost-to-income ratio (CIR) to below 40% over the medium term, but did not commit to any timeline. For the first half of FY18, the group’s CIR fell to 42.5%, from 43.6% a year ago.

“In line with our strategy of being digital at the core, we remain focused on executing our digital strategy which includes strengthening our digital offerings, transforming our products and services as well as improving our engagement with our customers. We will continue to grow our domestic franchise and regional businesses through our multichannel banking,” its group managing director and chief executive officer Domenic Fuda said in a statement yesterday.