Commerzbank paves the way for 10,000 job cuts

Photo: EPA

Germany’s Commerzbank announced it had reached an agreement with representatives of employees over planned job cuts aimed to reduce operating costs, Reuters reported. The Verdi labour union confirmed the information and elaborated that the issue concerned some 10,000 worldwide. The agreement is central to Chief Executive Officer Manfred Knof's plans to restructure and spur the nation's second-biggest listed lender and return it to profitability.

The deal includes early retirement and reduced hours for older employees, Verdi said. It also includes severance packages and retraining programmes for employees. Weeks after taking the job as Commerzbank's CEO, Knof announced plans to cut 10,000 jobs and close hundreds of branches in a 1.8 billion euro restructuring. Over the past months, management has negotiated the reductions with labour representatives, hoping to clinch a deal before the bank's annual shareholder meeting this month.

Commerzbank hopes the revamp will revive its fortunes, as it struggles to restore profits after management reshuffles and strategy flip-flops. It has never fully recovered after a state bailout during the last financial crisis more than a decade ago and lost 2.9 billion euros in 2020. Knof told employees in January that cuts were a necessary "bitter pill". Christoph Schmitz, a Verdi official, said the agreement would effectively prevent forced redundancies and slow departures so that the remaining workforce was not overburdened.

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