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Report: Alfa-Bank to cut 12% of workforce due to online services expansion

Russia-based JSC Alfa-Bank will reduce its workforce by about 12% by the end of 2019 as it plans to expand its online services, news website Finanz.ru reported May 20, citing Bloomberg.

Alfa-Bank CEO Vladimir Verkhoshinsky told the newswire that of 3,000 employees to be laid off by year-end, 2,000 left the bank in the first quarter. The layoffs are mainly due to the lender's decision to no longer provide loans for purchases of goods in brick-and-mortar stores, but to offer them online instead.

The bank, which employed about 25,000 people at the beginning of 2019, will also focus on releasing mobile banking products under its new strategy, with plans to double its market share in the retail lending segment and attract 2 million new retail customers within three years, the executive said.

Alfa-Bank's retail loan book grew 66% in ruble equivalent in 2018, and the lender is eyeing 50% growth in 2019 due to to the issuance of retail mortgages, cash loans and credit cards. The financial institution also expects that revenues from its retail and SME businesses will make up 70% of its profit in 2021, compared with the current level of 50%, according to Verkhoshinsky.