Kerala’s Catholic Syrian Bank will retire employees aged 58 and older on April 30 this year, seeking to reduce costs after Indo-Canadian billionaire Prem Watsa invested around Rs 1,200 crore in the lender.
Employees say retirement age in the sector is 60 and a circular asking those who will be 58 years or older on May 1, 2019 to go on April 30 is shocking.
Sources said that the bank aims to cut salary expenditure by sending out more than 110 employees who fall under the age criteria. With around 3,000 employees, salary is almost one-fourth of the bank's income.
C V R. Rajendran, managing director and chief executive officer of the bank, said the retirement age was decided and conveyed to employees in 2016 but it was not implemented then.
The bank posted Rs 975-million losses in FY18 due to higher provisioning and write-offs on account of non-performing assets.
Watsa's Fairfax India Holdings secured two board seats, including the chairman's post, when it acquired a 51-per cent stake in the bank last year by investing around Rs 12 billion last year. On October 19, 2018, Fairfax India Holdings announced that it received all required regulatory approvals and has completed initial closing of its Rs 12.1 billion investment in the bank.
The bank, with headquarters in Thrissur in Kerala, was established in 1920 and it has 421 branches and 264 ATMs across India.