Last Year, 1,680 Voluntary Retirements at Four Major Banks... 10,000 in Four Years

Estimated Voluntary Retirement Scale of the Four Major Banks in 2019: 1,680 Employees... 9,950 Over Four Years

Mobile Banking Transactions Increase by an Average of 19.9% Annually → Offline Channel Share Declines

Implications of Increased Banking Sector Investment in RPA, a Pre-AI Stage

[Asia Economy Reporter Kangwook Cho] Last year, the scale of voluntary retirements at the four major banks was estimated at 1,680 employees. Over the past four years, the total approaches 10,000.

According to the financial sector on the 19th, the voluntary retirement scale at the four major banks last year was 1,680 employees, with related retirement costs estimated at approximately 666 billion KRW.

Additionally, over the past four years, 9,950 employees have taken voluntary retirement at the four major banks, with related costs reaching 3.4 trillion KRW.

KB Kookmin Bank led in both the number of voluntary retirements and related costs. Over four years, KB Kookmin Bank conducted voluntary retirements for 4,430 employees, incurring costs of about 1.5 trillion KRW. Next, Woori Bank had 2,222 voluntary retirements and spent 720 billion KRW. However, Woori Bank also hired a large number of new employees, so the overall workforce did not change significantly. Shinhan Financial Investment evaluated that this provided an opportunity to improve the inverted pyramid structure of personnel, which had been pointed out as a structural problem, thereby reducing costs.

Researcher Suhyun Kim of Shinhan Financial Investment diagnosed, "Such large-scale voluntary retirements are interpreted as a means to improve the inverted pyramid structure of bank personnel, optimize costs, and respond to the rapidly evolving financial digital platform competition with big tech companies."

The mobile banking transaction volume of the four major banks reached 276 trillion KRW in the third quarter of last year, increasing at an average annual rate of 19.9% over the past five years. During the same period, the share of offline branch transactions decreased from 57.8% to 50.8%. This trend is explained by a significant increase in digital transactions not only in retail finance mobile banking but also among corporate clients, leading to a gradual decline in the share of offline channels.

Researcher Kim also pointed out that not only sales channels but also head office operations show attempts at digitalization.

He explained, "Among the digital investment plans announced by the Financial Supervisory Service for the banking sector, the largest area is 'Robotic Process Automation (RPA).'" He added, "RPA is an attempt to replace simple repetitive back-office tasks and can be seen as an intermediate testing stage toward AI, which is the ultimate focus in the financial sector."

RPA is a technology that automates simple repetitive human tasks through algorithms. It can prevent productivity decline caused by tedious repetitive work, allowing personnel to focus more on high value-added tasks and serving as a means to fill workforce gaps in the digital era financial sector. Actual financial sector applications include preparing result reports for all business days, creating ad hoc disclosure materials such as funds and interest rates, reviewing and verifying customer supporting documents during screening processes, and recently expanding into areas such as credit management, foreign exchange operations, and investment product tasks.

Researcher Kim said, "Although still in the early stages of adoption, some major banks have already replaced 110,000 hours of annual work, and some regional banks have replaced 17 tasks at the initial stage of adoption." He forecasted, "Especially since head offices have already started implementation but branches have not yet adopted RPA, the growth potential of RPA is quite significant."

This content was produced with the assistance of AI translation services.