While the NAB has suggested a net gain of 2000 new digitally-focused positions will help offset the expected shedding of about 4000 jobs, it says positions will be cut at its headquarters in the Docklands in Melbourne.
And the bank’s announcement on Thursday sparked a reaction from Victoria’s Treasurer Tim Pallas who says he expects a "disproportionate number" of National Australia Bank job losses to have an impact on the State.
The NAB move to slash staff has been described by Melbourne’s Swinburne University Adjunct Professor from the Faculty of Business and Law, Steve Worthington, as a case of reshaping its operations for a digital future.
According to Worthington, NAB's net 4000 jobs reduction reflects the reality of the banking market now and in the future.
He said the NAB news was a “stark example of how all the major banks are reacting to changing customer behaviour - less need for customer facing personnel-more need for staff who have 'digital' skills, who can operate in the digital future".
In an indication of an the impact on the bank’s Melbourne headquarters, NAB chief executive Andrew Thorburn has said administrative positions will likely be cut.
The bank’s decision to cut its workforce comes as it announced a massive full year net profit of $5.3 billion for 2017. It put the decision to slash staff largely down to the impact of new technology and digital transactions on traditional roles.
Thorburn says the banking industry is under pressure to reshape its workforce "as transactions move to digital channels, and this is driven by our customers, we will need fewer people".
Pallas is quoted as saying, "At the moment you would expect that a disproportionate number (of job losses)... will come from Victoria because the headquarters are based here".
"This is a three-year phasing period that they're proposing, so they should be able to manage this sensibly and I urge them to do so," he said.
The $5.3 billion net profit announced by the NAB was an increase of more than 1400% on 2016, while redundancies are expected to cost the bank up to $800 million.
The 2016 profit of $352 million was primarily due to the sale, at a loss, of its UK and life insurance businesses.
Thorburn says the job cuts are part of the bank’s plan to achieve $1 billion in annual savings through automation of processes previously performed manually, and a reduction in the number of products offered by the bank and changes to its branch network.
The bank chief has also flagged the closure of some bank branches, but the opening of new branches in the growth corridors in western Sydney and Melbourne.