European Banks, Planning a Massive Wave of Layoffs

Economy Nilgun Salim
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European banks are preparing for a new wave of layoffs. At least 20,000 workers are going to be suspended, after the stricter regulations in the banking system is decreasing their profits, written Bloomberg.

ING is planning to cut 5,800 jobs in the next five years, only in Belgium and Netherlands, motivating they are trying to focus more on the internet banking divisions and automated systems.

Last week, Commerzbank of Germany broke the news of cutting more than 9,600 jobs, while the Banco Popular of Spain will suspend 3,000 employees.

‘The banks are struggling with regulatory costs and a fierce competition. The profit is decreasing due to the lower interest rates’, said fund manager at Bellevue Asset Management from Switzerland Karim Bertoni.

‘Banks are trying to economize and people are playing a key role in this’, said Karim, who manages more than 6,9 billion Swiss francs.

The wave of layoffs will mostly affect the employees from the IT department. In June, during their first round of negotiations, Deutsche Bank reached an agreement with the unions to eliminate around 3,000 employees with permanent contracts.

The global banking group will keep approximately 75,000 employees. A representative of Deutsche Bank refused to comment on the information.

Commerzbank announced it will lay off almost 10,000 workers. In addition, the bank announced they will stop paying dividends ‘for now’.

The announcement made by Commerzbank included a net loss of 700 million euros in the third quarter of 2016.