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Spain's Banco Popular to axe 3,000 jobs in cost cutting plan
The bank plans to close around 300 of its 2,000 branches in Spain as part of a restructuring plan. Photo: AFP

Spain's Banco Popular to axe 3,000 jobs in cost cutting plan

AFP · 21 Sep 2016, 12:49

Published: 21 Sep 2016 12:49 GMT+02:00

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The bank plans to close around 300 of its 2,000 branches in Spain as part of a restructuring, it said in a statement.   

"This restructuring process will affect between 2,900 and 3,000 people," the statement said.

The bank said it would negotiate the job cuts with unions.    

Banco Popular, Spain's seventh largest bank by market capitalisation, announced a cost-cutting plan in July, a month after raising €2.5 billion ($2.8 billion) in a share issue to clean up its balance sheet.

Like other Spanish lenders, it is making a major push to sell off real estate assets, including repossessed homes, which are clogging up its balance sheet and eating into earnings.

Banco Popular in July reported a second quarter net profit of just €122,000 and announced provisions on bad loans of €4.7 billion.

Spanish banks, which slimmed down after a decade-long property boom went bust in 2008, are once again closing branches and slashing jobs as their profitability is hit by stiff competition.

Santander, the eurozone's biggest bank by market capitalisation, plans to close 450 smaller branches and cut 1,400 jobs in Spain, about five percent of the staff in its home market, through voluntary departures.

Story continues below…

Barcelona-based CaixaBank, Spain's third-largest bank, plans to cut 3,000 jobs, mainly through early retirement, as it seeks to trim its salary costs.    

Spain has the densest bank branch network in western Europe, with 8.6 branches per 10,000 residents, according to consultancy Roland Berger.  

The average in the entire European Union is five branches per 10,000 residents.

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