OCBC just hired 532 people and handed out $3k pay rises

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OCBC boosted its headcount by 532 last year and gave its average employee a S$3k pay rise, inching its per-head compensation slightly closer to that of rival DBS.

OCBC’s headcount reached 29,706 at the end of December, up from 29,174 a year previously, according to its 2018 results, which were published today. While this 2% rise pales in comparison to the 11% increase in DBS’s workforce over the same period, it is still significant given the tight labour market in Singapore. Moreover, many of DBS’s new staff came from its acquisition of ANZ businesses in Asia.

What jobs are the 2018 OCBC recruits doing? The firm’s new earnings report doesn’t say, but it’s safe to assume that many of them are working in technology and digital banking roles. Our October analysis of OCBC’s careers site found that nearly one in five of its vacancies were tech-related. The bank’s previous earning’s report, for Q3 2018, stated that “technology and digital investments” had “strongly contributed” to its expansion. Some of OCBC’s new tech hires are working on emerging technologies, such as the roll out of a facial recognition system for its premier banking business.

OCBC also added employees to its private banking offshoot, Bank of Singapore, including bankers for a new team set up in May to support independent asset managers. This recruitment appears to be paying off. Assets under management at BoS increased to US$102bn in the fourth quarter, up 3% year on year, and “driven by sustained net new money inflows”.

In terms of profit growth, however, Global Consumer/Private Banking (of which BoS is a part) was eclipsed by Global Corporate/Investment Banking. Profit in the former rose 7% to S$1,318m for 2018, but shot up 30% to S$1,825m in the latter. Has OCBC been hiring a lot of investment bankers as a result? No, says a Singapore-based headhunter. OCBC only ranked eighth for 2018 Southeast Asia investment banking revenue by bank, five places behind DBS, according to Dealogic. Most of the front-office hiring in the division was for corporate bankers, who remain in demand across banks in Singapore, says the headhunter.

Overall net profit at OCBC grew 11% to a record S$4.49bn in 2018, although revenue falls in the fourth quarter might have put a dent in 2018 bonuses, especially for traders. In OCBC’s Global Treasury division, a “decline in net trading income” contributed to a 23% fall in operating profit in Q4 versus Q3. OCBC is not the only bank in Asia whose traders suffered as markets tanked toward the end of the year. Treasury Markets earnings at DBS in Q4 were 7% below the previous quarter. Fourth quarter Asian revenues slumped at Credit Suisse in both equities and fixed-income trading.

Meanwhile, staff costs per head at OCBC – total employee expenditure (such as salaries and bonuses) divided by total headcount – rose by 3.6% (S$3,028) year on year to reach S$87,726 for 2018. That’s a higher rate of increase than at DBS (2.2%) over the same period. But while the compensation gap between the two Singaporean banks has narrowed, it still stands at a substantial S$31,335.

Have a confidential story, tip, or comment you’d like to share? Contact: smortlock@efinancialcareers.com

Image credit: RomanBabakin, Getty

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