Commerzbank to cut up to 6,000 jobs

Thu Jan 24, 2013 9:01am EST
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By Arno Schuetze and Alexander Hübner

FRANKFURT (Reuters) - Commerzbank (CBKG.DE: Quote), Germany's second-biggest bank, plans to cut up 6,000 jobs by 2016 to try to reduce costs as part of efforts to revive its struggling retail business.

The Frankfurt-based bank said on Thursday it would shed 4,000-6,000 full-time positions, as much as 12 percent of its workforce. Talks with unions will start in February over the exact number of jobs affected, which are expected to be mostly in Germany.

The bank, 25 percent state-owned since a bailout in the financial crisis, currently employs 56,000 staff at group level, with 49,000 full-time staff.

Labor representatives condemned the cuts at Commerzbank as unacceptable, while analysts said the bank should go further.

The cutbacks form part of a 2 billion euro ($2.66 billion) overhaul the bank announced in November, which includes a revamp of its retail business in Germany.

Like other European banks, Commerzbank is battling rising costs from tough new bank rules, while risk-averse customers have put a damper on fee income. In its retail business, margins are under pressure from deposit wars in Germany's overcrowded retail bank sector.

Jobs are being axed across Europe's banking industry because of the cost of new regulation and the weak business climate. Deutsche Bank (DBKGn.DE: Quote), Switzerland's UBS UBSN.VX and France's BNP Paribas (BNPP.PA: Quote) have announced job cuts, while Britain's Barclays (BARC.L: Quote) is expected to announce cutbacks next month.

Earlier this week, sources close to UniCredit (CRDI.MI: Quote) said that the Italian bank planned to shed about 1,000 jobs at its German arm.   Continued...