China Construction Bank (CCB) may have to pay out RMB 2 billion in severance payments to 28,000 employees who lost their jobs in preparation for its US$5 billion Hong Kong listing in 2004.
The cost would be about half of the bank’s 2002 profit of RMB 4.33 billion.
The bank said it would keep only staff with university degrees.
In 2001, the bank reduced its headcount by 16.5% and shut down 5,000 branches across 28 provinces.
In 2003 CCB was set to axe about 1,000 employees in each of the 28 provinces in which it operates, paying RMB 70,000 to each laid-off employee.