The research has also revealed that the 25 banks studied are reluctant to spend on employee training and career developments
A total of 5,470 employees were terminated in 2017 from 25 commercial banks in the country, according to a recent study of thBangladesh Institute of Bank Management (BIBM).
The study titled “A Review on Human Resource Management of Banks 2017” was carried out by a seven-member team led by BIBM Associate Professor, Mohammad Tazul Islam.
The team interviewed 300 employees from 25 banks, including state-owned, private, and Islamic banks.
According to the research findings presented at a workshop at the BIBM office in Dhaka on Thursday, there were a total of 90,265 employees in the banks in 2016, but in the following year their number came down to 81,245, a 6.5% employee turnover, the highest in history.
The turnover rate was 4% in 2016 and 2015, and 5% in 2014.
“The rate of employee turnover increased remarkably in 2017, which is not a good indicator of sound HR practices. Therefore, commercial banks should consider reducing the employee turnover rate by ensuring a good work environment and better salary structures, reducing job strains, promoting good ties with employees, and providing career development facilities,” it reads.
“The management of a bank and its board of directors should be honest and sincere in their HR practices, not by terminating employees, but by nursing them. The central bank should play a role in this regard and monitor whether employees are forced to resign at commercial banks.”
Some 64% of employees said the violation of ethical codes of conduct is alarmingly increasing at commercial banks, while 61% of employees said there is an acute crisis of model professional leaders in the banking industry, with an increase in loan defaults, forgery, and a decline in profitability at banks.
The research has also revealed that the 25 banks studied are reluctant to spend on employee training and career developments.
In 2017, they spent only 0.25% of their total operation expenditures on employee training, which was 0.50% in 2016. However, by global standards, a bank is required to allocate 2% to 3% of its total operations budget for employee training and professional development.
Addressing the workshop as its chief guest, Bangladesh Bank Deputy Governor Ahmed Jamal said: “In Bangladesh, banks are actively involved in human resource acquisition and retention management by providing necessary training, counselling, and motivation to their employees. They are making efforts in promoting corporate governance in the banking sector.”
He also said the central bank and the Finance Ministry had issued notifications on several occasions, asking stakeholders to ensure and promote better human resource management in this sector.
Former Dhaka University professor, Barkat-e-Khuda, former AK Gangopadhaya Chair Professor at BIBM, SA Chowdhury, BIBM Supernumerary Professor Md Yasin Ali, Premier Bank Ltd Deputy Managing Director MA Abdullah, Head of HR of ONE Bank Ltd, John Sarkar, also spoke at the event chaired by BIBM Director General, Toufic Ahmed Choudhury.