Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Banks to slash extra 1000 jobs On 21st August 2002 the Commonwealth Bank (CBA) announced that it would slash 1550 jobs while creating 550 jobs,

Banks to slash extra 1000 jobs

On 21st August 2002 the Commonwealth Bank (CBA) announced that it would slash 1550 jobs while creating 550 jobs, a net loss of 1000 jobs. It planned to reduce inefficient operations, task duplication & some back-office processing functions, but stated that it would not close more branches even where closures had been planned. The news received hostile reactions from both unions and consumer advocates like the Australian Consumers' Association (ACA).

Union officials said that the job cuts were scandalous, and that bank staff were suffering from uncertainty following previous cuts and closures. ' It is unbelievable' said Tony Beck, Finance Sector Union national secretary. ' They have just shed 500 jobs, all from the retail network. Now we get this punch with another 1000 jobs.'

The ACA was equally unimpressed. Its finance policy officer Catherine Wolthuizen asked when the losses would stop. ' How much profit is enough for greedy banks like CBA and how much further will it flout consumer and community demands before the Government acts?'

The ACA wants a social charter set up to delineate minimum standards around access to banking and affordability. It has been lobbying the Federal Government to act for consumers in the face of massive bank profits.

CBA's annual profit leapt 11percent to $2655 billion in the previous financial year, increasing income (over $1.8m) from fees, commissions and other charges contributing to the profit surge. The strong housing market contributed to an increase in lending fees income: $618m, up 3percent. Commissions and other fees raised a massive $1.242 billion, up 6 percent.

Required:

Explain whether you think the banks would or should respond to the concerns of the ACSA and/or concerns of the Finance Sector Union. What theory(s) did you rely on (if any) to form your judgement?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Financial Accounting

Authors: Fred Phillips, Robert Libby, Patricia Libby

6th edition

1259864235, 1259864230, 1260159547, 126015954X, 978-1259864230

More Books

Students also viewed these Accounting questions

Question

3. Use the childs name.

Answered: 1 week ago