Citing operational efficiencies, Scotiabank has announced the closure on May 29 of its Foster’s airport branch, transferring customers to its newest center in South Sound.
In a formal statement, the Toronto-based bank, formally known as the Bank of Nova Scotia, called the move “a consolidation,” saying that it would “help us to concentrate our resources to better serve our customers in the future and remain competitive.”
The airport Foster’s operation, one of four local Scotiabank branches, employs 10 people, out of a total of 143 in Cayman. Representatives said the bank is “committed to supporting employees through this transition and staying true to our principles of treating employees fairly, equitably and with respect.
“In order to minimize the impact on employees, we will be providing staff with training opportunities to prepare for future positions while giving priority to impacted staff who are qualified for available positions within the bank,” the statement read.
Scotiabank marketing manager for the northern Caribbean, Jennifer O’Leary, said executives have no further plans for Cayman’s remaining branches, but she did not dispute that the bank was looking at a global retrenchment under economic pressures.
“Currently, we do not have any plans to consolidate other branch locations,” she told the Cayman Compass. “Scotiabank continues to see the Caribbean region as an important part of our international footprint and remain[s] committed to the Cayman Islands and the local community.”
Last December, however, Scotiabank said it was “reducing structural costs” after a November announcement that it would close 120 of its foreign branches, cutting 1,500 jobs – about one-third outside Canada.
“In recent years,” the Dec. 23 Scotiabank press release said, “international banking has worked to build our market position, both through organic growth and selective acquisitions.”
While this “has served Scotiabank well, it has also created some overlap and duplication of services throughout our footprint,” the document said.
Scotiabank is Canada’s third-largest bank, boasting 86,000 employees – 12,600 of whom are in 294 branches throughout 25 Caribbean and Central American countries – serving 21 million clients globally in 2,102 international branches and offices, and another 1,186 across Canada.
Its international banking division encompasses both retail and commercial banking operations in 43 of the more than 55 countries where Scotiabank operates.
Ms. O’Leary earlier told the Cayman Compass that “a limited number of branches in the Caribbean will be closed, combined with other branches to align with market opportunity and minimize overlap.”
She said the bank was “pre-eminent” in the region after 125 years in the Caribbean and 50 in Cayman.
Analysts have said the economic climate in Canada, however, “remains challenging,” as conditions threaten to deteriorate.
“Canadian consumers are highly leveraged and demand for personal loans and mortgages is expected to slow considerably,” the analyst said, demanding anonymity. “Canadian banks have to prepare for potential interest rate hikes in 2015.
“As a result, banks’ strategies have to focus on new growth areas and capital has to be deployed in different business segments.”
Ms. O’Leary said Thursday that “Scotiabank continuously reviews its operations on a local, regional and global scale to ensure that we are structured in the right way to serve our customers. Like any organization, we continually review our operations to ensure we are operating in an efficient and customer-focused way.”