Deputy Finance Minister Othman Aziz said the closure was made by banking industry players as a result of commercial considerations and competition from other banks.

“I think from an economic outlook, it is still growing (between) four and five per cent.

“Banks are business entities. They need to rationalise their business,” he said when replying to a supplementary question from Dr Mohd Hatta Md Ramli (Amanah-Kuala Krai) on whether the closure of bank branches was an indication of the country’s economic crisis.

Othman said this year, 58 commercial and five Islamic bank branches had been closed compared with 32 commercial and 11 Islamic bank branches last year.

He said 1,425 bank employees were retrenched over the last six months, most of them through the mutual separation scheme, due to the restructuring and not solely due to the closure of the branches.

In the third-quarter of this year, he said there were 137,000 bank employees nationwide.

Replying to another supplementary question from Hasan Arifin (BN-Rompin) on the high profits earned by banks but low rewards given to employees, Othman said this depended on the policy of each bank.

“Shareholders are those who have expertise in the banking industry and in formulating policies in the interest of the bank.

“But we want Bank Negara Malaysia to renegotiate with these banks so that the emoluments of their employees are in accordance with the needs of the industry.”