Commerzbank, Germany's second-biggest bank, is widening the scope of its savings program and plans to shed more than 450 jobs on top of an ongoing restructuring plan, three people familiar with the matter said.
At a staff meeting last week, Commerzbank's works council representatives announced that the bank is targeting 350 jobs cuts at its finance department in Frankfurt by 2017 and 100 at sites in Duisburg and Berlin, according to people who attended the meeting.
"There have been signals from the board that there is more to come and that all departments of the group could be hit in the short term," one of the people said.
Commerzbank, which is in the midst of a radical cost-cutting program - its second in four years - had announced plans to shed 5,200 of its roughly 45,000 staff. It has struggled to overhaul itself since receiving an 18 billion euro ($24.2 billion) bailout following a disastrous merger with Dresdner Bank in 2009.
Other banks in Germany have also been trimming their workforce as they restructure their businesses in the wake of the financial crisis.
To fill the gap left by the departure of the 450 employees, Commerzbank plans to shift some accounting work to internal low-cost firms controlled by Commerzbank such as Poland-based Ceri and Eastern Germany-based ComTS sites, the people added.
"Of course, wages there are much lower. But not only do such moves come with significant severance costs, they also create operational risks," one of the people said.
Mark Roach from union ver.di said that the bank needs to be prepared for resistance if it breaks labor contracts.
German daily newspaper Handelsblatt reported earlier on Monday that Commerzbank planned to outsource parts of its finance department. Commerzbank acknowledged only that it plans a restructuring in the finance area as part of its regular review of processes.
Separately, the sources said that German regulator Bafin has reprimanded Commerzbank over some data security issues after running a targeted probe.
Commerzbank is creating 30-40 information technology jobs to address the problems identified by Bafin, one of the people said.
Commerzbank declined to comment of the Bafin probe and any consequences stemming from it.
($1 = 0.7447 Euros)
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