After a billion-dollar loss in the Corona year 2020, Commerzbank wants to make itself fit for a more successful future with further tough cuts. 10,000 full-time positions are being cut worldwide, and in Germany the institute has halved the number of its branches from 790 to 450. The supervisory board of the Frankfurt-based MDax group approved the majority of the board’s savings plans until 2024 in a special meeting on Wednesday.
“The strategy proposed by the Management Board will be supported by the Supervisory Board in terms of content and expertise and its implementation will be constructively supported,” announced the bank in the evening. Commerzbank published the key points of the plans last Thursday.
The CEO Manfred Knof, who has been in office since the beginning of the year, wants to make the bank more profitable again. The 2020 financial year ended, as expected, in the deep red: According to preliminary figures, the group loss is just under 2.9 billion euros, the bank announced.
This includes 800 million of the total of 1.8 billion euros in expenditures for the corporate restructuring. The 2020 annual result will also be affected by the fact that the institute is writing off 1.5 billion euros because the businesses taken over from Dresdner Bank and the Polish MBank did not develop as well as hoped at the time. The bank will publish the details of the balance sheet on February 11th.
According to the bank’s information so far, every third job in Germany is affected by the cuts. Knof has assured that the management will do everything possible to avoid redundancies. However, after the plans became known, the Verdi union called for more time to implement the downsizing. In the supervisory board meeting on Wednesday, the union representatives present were reportedly critical.
In order to advance the negotiations on the downsizing “swiftly and with the necessary fairness and transparency”, the Board of Management signed a regulatory agreement on Wednesday with the General Works Council of Commerzbank AG. “The aim is to ensure the earliest possible clarity and transparency about the issues, timing and perspectives.” The aim is “to complete the necessary framework regulations – framework balance of interests and framework social plan – with the general works council by the general meeting on May 5, 2021.”
At the end of September last year, the group still had a good 39,600 full-time positions. In terms of employees, it was 47,912, 33,739 of them in Germany. Shortly after Christmas, management and works councils had already agreed to cut 2,300 full-time positions.
In contrast to many of its competitors, Commerzbank stuck to a dense branch network in Germany for a long time. Now the bank is giving up another 340 locations. The bank had not reopened 200 branches that were closed during the pandemic.
At the same time, the executive board announced that it would digitize and automate business processes “consistently and consistently”. Together with the online subsidiary Comdirect, which is currently being integrated, the digitalization of the offers is to be advanced. 1.7 billion euros are being invested in IT. The group’s costs are expected to fall by 1.4 billion euros by 2024 compared to 2020.