Santander Plans 4,000 Job Losses, Adding to Wave of Cuts
(Bloomberg) -- Banco Santander SA plans to cut as many as 4,000 jobs in Spain, adding to a global wave of staff reductions across the financial industry.
The lender told union leaders on Friday it will lay off as much as 13% of its Spanish workforce and close as many as 1,000 branches after the pandemic boosted a switch by customers to digital channels, according to two people with knowledge of the matter. The lender also plans to relocate 1,090 more employees into other units, the people said, asking not to be named as the matter is private.
Banks worldwide have announced staff reductions of more than 75,000 workers and are set to surpass the 80,000 cuts made last year, according to calculations by Bloomberg. Britain’s Lloyds Banking Group Plc last week announced it was cutting about 1,070 roles, mostly at its technology and retail units. Dutch lender ING Groep NV expects 1,000 reductions by the end of 2021.
Other Spanish lenders are also making cuts. Banco de Sabadell SA is in talks with unions to shed as many as 1,800 workers while CaixaBank SA and Bankia SA are expected to announce a round of job cuts and office closures to generate 1.1 billion euros of cost savings as part of a merger to form Spain’s largest domestic bank.
Spain has been hit particularly hard by the Covid-19 pandemic, recording some of the highest infections in Europe. The country’s retail-focused banks are especially susceptible to the monetary policy of the European Central Bank, which has driven interest rates deeper into negative territory in response to the virus, making profit from lending harder to generate.
Santander said last month it’s accelerating plans to cut costs in Europe. It said it will reach a target to reduce costs by 1 billion euros by the end of 2020 ahead of schedule and plans to generate another 1 billion euros of savings by the end of 2022.
The bank is adjusting its distribution network to respond to the rapid rise in digital transactions, which were accelerated by a three-month lockdown in Spain, Chief Financial Officer Jose Garcia Cantera said in a Bloomberg TV interview last month.
Santander last year agreed with unions to cut more than 3,000 jobs as part of the integration of Banco Popular Espanol SA, which it bought in 2017 as part of a resolution coordinated by the European Union. The lender has also cut 140 branches in the U.K. and 2,000 jobs in Poland.
©2020 Bloomberg L.P.