‘Death by a thousand cuts’: Bank of Queensland slashes up to 400 jobs

The Bank of Queensland will slash up to 400 jobs and acquire more than 100 franchised businesses in a restructure its chief executive Patrick Allaway said was aimed at simplifying the business.

The regional lender said its retail banking model was no longer sustainable and that it would bring all 114 owner-managed branch networks into its corporate structure by March, which would cost between $115 million and $125 million over four years.

Bank of Queensland chief Patrick Allaway has stepped up job cuts at the regional lender,Credit: Dan Peled

The owners and employees of the franchised businesses would be given the option to work for the bank, Allaway said in an update to analysts on Thursday.

“We have long recognised the need to address legacy complexity and structural challenges to change the way we do business,” he said before the briefing in a statement to the ASX.

“Through the initiatives we announced today, we are taking a significant step forward in delivering a simpler, specialist BOQ.”

Allaway flagged further “consolidation” of the bank’s branch network if customers continue to shift to digital banking, as well as “more efficiencies” - ie cost savings - over the next two years.

‘Workers are walking around feeling that they have a target on their backs, waiting for the axe to fall on them.’

Finance Sector Union national secretary Julia Angrisano

The bank plans to make up to 400 full-time roles redundant at a one-off cost of up to $35 million, which is expected to save it $50 million over the next two years.

The latest cuts come on top of the 250 jobs lost in the past year, in a move criticised by the union as a “death by a thousand cuts”. However, the bank has hired 10 bankers in the past six months as part of a strategy to expand its business banking team.

Shares in BOQ were down 4.1 per cent at $6.16 in lunchtime trading.

Finance Sector Union national secretary Julia Angrisano said workers were paying the price for management’s poor governance after the bank was forced to set aside $50 million last year as part of an enforceable undertaking it entered into with regulators, the Australian Prudential Regulation Authority (APRA) and financial intelligence agency AUSTRAC.

“Workers are walking around feeling that they have a target on their backs, waiting for the axe to fall on them. Workers are incredibly anxious about their futures and deserve certainty as they make their own plans for themselves and their families,” Angrisano said.

BOQ removed George Frazis as its chief executive in late 2022 after just three years in the job, with the board at the time saying it wanted a different style of leadership over a “prolonged period”. Some analysts had said the change created significant leadership uncertainty during the bank’s “complex, multi-year strategic transformation”.

E&P analyst Azib Khan said BOQ’s latest announcement created even more earnings uncertainty.

“BOQ is dealing with an APRA enforceable undertaking, [an] AUSTRAC enforceable undertaking, a digital transformation program, a simplification program, and will now also be dealing with conversion of all of its [franchised businesses] to corporate branches, and will be looking to accelerate its business bank growth at the same time,” Khan said.

“Management have a lot on their plate.”

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