United Overseas Bank (UOB) has enforced restrictions on hiring, pay hike, and promotions as the bank braces for reduced earnings amid the Covid-19 pandemic, Bloomberg reported.

In an internal memo, the lender told its employees that it anticipates the bank’s situation to worsen after the Singapore government cuts its support.

The bank will not hire new people until December 2021, subject to senior approval for any exceptions.

UOB has also put on hold the employees’ yearly pay raises as well as promotions until further notice, the report added.

In the memo sent on behalf of HR head Dean Tong, UOB head of strategy and transformation Federico Burgoni and CFO Lee Wai Fai said that all employees “need to play their part, controlling costs and headcount. We will review these dynamically as and when the situation improves.”

Responding to inquiries, Tong added that given the economic uncertainty, UOB “must take a disciplined and selective approach to any new headcount increases.

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He said that the bank will continue “investing in and hiring for roles essential for our strategic priorities”, and to protect “the livelihoods of our people, we are keeping salaries at their current levels for now and will revise our stance as the external environment improves.”

UOB operates in 19 markets, including China, Hong Kong, Thailand, and Malaysia.

The bank employs nearly 26,000 people across its corporate and retail businesses, as well as wealth management, commercial and private banking units.

Banks in Singapore are preparing for rising bad debts as the pandemic continues to hurt the economy.

The government has been providing relief measures to support the impacted businesses.

However, the Monetary Authority of Singapore (MAS), the country’s central bank, has indicated that a debt moratorium will not be extended.

OCBC CEO Samuel Tsien said that it is reviewing managers’ compensation as a way to cut costs.

Singapore’s largest bank DBS Group has also been reviewing costs and cutting expenses, the Bloomberg report added.