BY DARIA SITO-SUCIC at Reuters
UniCredit (CRDI.MI), Italy's biggest bank by assets, is planning to cut around 10,000 jobs, or 7 percent of its workforce, as it seeks to slash costs and boost profits, a source at the bank told Reuters on Monday.
The planned cuts will be concentrated in Italy, Germany and Austria, several sources said, adding that they include 2,700 layoffs in Italy that have already been announced.
A UniCredit spokesman declined comment beyond noting that the bank's CEO Federico Ghizzoni had on Sept. 3 said there were no concrete numbers on potential lay-offs, after a report said it was considering eliminating 10,000 positions in coming years.
Ghizzoni is reworking a five-year strategic plan, unveiled only last year, that will aim to boost revenue and cut costs. The revised plan is expected to be announced in November.
"The plans are for 10,000 job cuts," the bank's insider said, speaking on condition of anonymity. "They will be mainly in Italy, Austria and Germany."
UniCredit, which has 146,600 employees across 17 countries, is under pressure to boost its profits as low interest rates are expected to keep hurting its earnings in coming years.
Other banks, such as Britain's Barclays (BARC.L), are also cutting thousands of jobs and selling assets, as lending margins are squeezed.
Financial sources said on Monday Deutsche Bank (DBKGn.DE) was aiming to cut roughly 23,000 jobs, or about a quarter of the total, through layoffs mainly in technology activities and by spinning off its PostBank (DPBGn.DE) division.
Reducing costs would also help UniCredit allay market concerns that it may need to launch a share issue, something Ghizzoni has repeatedly denied.
Any cost cutting has long been expected to target Germany and Austria, where the cost-to-income ratio was respectively 80 percent and 91 percent in 2014, compared to a group average of 61.5 percent.
But the exact numbers are still under discussion and may change, as could the number of countries involved, sources said.
One source close to the matter said Germany and Austria were in line for at least 1,500 job cuts each to simplify structure and eliminate duplication in areas like compliance and legal matters.
UniCredit posted first-half earnings of just above 1 billion euros, half those of domestic rival Intesa Sanpaolo (ISP.MI), which at the end of June had a core capital ratio of 13.3 percent against UniCredit's 10.4 percent.
BY THOMAS ATKINS AND KATHRIN JONES at Reuters
Deutsche Bank aims to cut roughly 23,000 jobs, or about one quarter of total staff, through layoffs mainly in technology activities and by spinning off its PostBank division, financial sources said on Monday.
That would bring the group's workforce down to around 75,000 full-time positions under a reorganization being finalised by new Chief Executive John Cryan, who took control of Germany's biggest bank in July with the promise to cut costs.
Cryan presented preliminary details of the plan to members of the supervisory board at the weekend. A spokesman for the bank declined comment.
Deutsche's share price has suffered badly under stalled reforms and rising costs on top of fines and settlements that have pushed the bank down to the bottom of the valuation rankings of global investment banks. It has a price-book ratio of around 0.5, according to ThomsonReuters data.
The bank unveiled a broad restructuring plan in April but co-chief executives Anshu Jain and Juergen Fitschen quit shortly afterwards, handing over its execution to Cryan.
"This is the first time ever that you had the feeling that somebody is talking straight," said one of the sources. "But the problem is he has to deliver soon."
Deutsche is mainly reviewing cuts to the parts of its technology and back office operations that process transactions and work orders for staff who deal with clients.
A significant number of the roughly 20,000 positions in that area will be reviewed for possible cuts, a financial source said. Back-office jobs in the group's large investment banking division will be concentrated in London, New York and Frankfurt, the source said.
PostBank has about 15,000 positions, pointing to roughly 8,000 layoffs at Deutsche once the unit's spinoff is completed as planned in 2016.
Cryan aims to present details of the restructuring plan before October, close to when the new CEO of investment banking rival Credit Suisse, Tidjane Thiam, is expected to present his plans for reforms.
Other European banks, including Italy's UniCredit, are also in the process of major job cuts.
In an effort to lower the bank's regulatory capital requirements and avoid raising new equity capital, Cryan will speed up changes to strategy and cut the balance sheet to avoid big one-off charges, Reuters has reported.
Deutsche Bank shares swung from negative territory to trade up almost 1 percent following the Reuters report on the headcount cuts to become the top gainer in the Stoxx index of European Banks, which was down over 1 percent at 1412 GMT.