One bank that has yet to report a voluntary retirement plan is First International Bank of Israel (TASE: FTIN), which has a poor efficiency ratio. Managed by CEO Smadar Barber-Tsadik, First International has taken several measures to improve its efficiency ratio, including closing down branches, consolidating subsdiaries Ubank Ltd. and Bank Poalei Agudat Israel into itself (resulting in 200 layoffs), cutting down the number of divisions, and closing FIBI London.
Sources inform "Globes" that the bank is currently drawing up additional cost-cutting measures to be presented by the end of the year. For the first time, these are expected to include a voluntary retirement plan. Up until now, early retirement at First International took place only in individual cases negotiated separately with each employee.
Four months ago, Bank Leumi (TASE: LUMI) announced a voluntary retirement program for 700 employees. Demand for the program was especially strong, and registration for it was closed within a new weeks. Implementation of the program will be completed by the end of the year.
Last month, Israel Discount Bank (TASE: DSCT) announced a new economizing plan for cutting its staff by 1,000 in the coming years, including 500 in a voluntary retirement program. It appears that the response to the program has been good, and it is believed that the retirement of 300 workers will be completed by the end of the year as planned.
Among the first to register for the Discount Bank early retirement program were several dozen veteran workers, the cost of whose retirement under the proposed plan exceeds NIS 2.5 million, the limit set in the Executive Salary Law. Since the High Court of Justice only recently ruled that the law would come into effect only at the end of the year, and would not apply to past rights, those employees were anxious about uncertainty, and quickly registered for the program in order avoid risking their retirement bonuses.
Published by Globes [online], Israel business news - www.globes-online.com - on October 30, 2016
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