Spain’s Sabadell kicks off new round of layoffs in Spain – union and memo

Spain’s Sabadell (SABE.MC) on Monday told its employees it will engage in a new round of layoffs in Spain, according to an internal memo from the bank and a statement from the Spanish union Comisiones Obreras.

The union did not say how many staff could be affected by the new cost-cutting plan. Sabadell declined to comment.

Banks across Europe are struggling to cope with record low interest rates, and the economic downturn sparked by the COVID-19 pandemic has forced them to focus on further cost cuts.

A source with knowledge of the negotiations said around 1,800 staff could be affected by the latest restructuring plan, a figure similar to the 1,817 staff cuts made recently.

The source said the figure had still not been agreed, and a new meeting between unions and the bank would take place on Thursday.

In an internal memo seen by Reuters, the bank informed the workers’ representatives of the start of a staff restructuring process.

“The bank’s intention is to negotiate a redundancy plan, which includes both early retirement mechanisms and voluntary redundancies,” the memo said.

Sabadell’s failure to merge with bigger rival BBVA (BBVA.MC) in November added pressure, and the bank is also expected to focus on new cost-cutting measures in Spain.

In May, the bank said that as part of its new three-year strategic plan it was planning additional cost savings and revenue growth from a push towards corporate and consumer lending in Spain.

Sabadell’s chief financial officer Leopoldo Alvear said in July the bank expected to announce in the third quarter more details on costs and synergies of its new restructuring process in Spain.

The bank currently has more than 14,600 employees in Spain.