Spanish bank Sabadell reaches deal with union to cut jobs

People walk to the door of an office at Sabadell Bank in Barcelona, ​​Spain on September 7, 2021. REUTERS / Albert Gea / File Photo

MADRID, Oct. 15 (Reuters) – Spanish bank Sabadell (SABE.MC) on Friday reached an agreement with a leading union to lay off up to 1,605 employees in its domestic market, less than the more than 1,900 initially planned.

The deal with Comisiones Obreras (CCOO) was reached after the bank responded to some of the union’s demands, such as setting a lower number of layoffs, capped at 1,380, a union spokesperson said .

“If 1,380 employees took a leave, the bank would take it,” the union spokesperson said, adding that if more people decided to leave, the cuts would be capped at 1,605 employees.

Sabadell issued a statement to the Spanish National Securities Market Commission (CNMV) confirming the deal.

“Today, Banco Sabadell has reached an agreement with all sections of the negotiating committee of the unions that represent the employees, in the framework of a dismissal procedure for Banco Sabadell in Spain which will affect a maximum of 1,605 employees”, a indicated the bank in a press release. .

The cost of the process is estimated at 269 million euros ($ 312.15 million) before tax, the bank said.

This would have a negative impact of around 23 basis points on the fully loaded Common Equity Tier 1 (CET1) ratio, the most stringent measure of solvency, he added.

This impact will be neutralized by capital gains from the sale of its bond portfolio, the bank said.

The deal will result in savings of at least 100 million euros ($ 116.01 million) per year before taxes, in line with what was announced in Banco Sabadell’s strategic plan, the bank added.

Spanish banks and their counterparts elsewhere in Europe are cutting costs and adapting to a move towards online banking, either on their own or through mergers, as their overall profitability is eroded by ultra-high interest rates. -low.

In September, Sabadell presented unions with a plan to cut 1,936 jobs and close or partially close 496 branches, as part of a shift to online banking.

This is the lender’s second downsizing in less than a year after recently cutting 1,817 jobs in Spain, where it employs a total of 14,648 people.

A total of 320 branches will close, nearly a fifth of the bank’s more than 1,600 branches in Spain, while the rest will open a few days a week, one of the sources told Reuters in September.

($ 1 = 0.8618 euros)

Report by Jesús Aguado; edited by Andrei Khalip, Susan Fenton, Jonathan Oatis and Richard Chang

Our standards: Thomson Reuters Trust Principles.

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