Workforce growing in Spain after big ERE agreed in 2020

MADRID, 24 (EUROPEAN PRESS)

Banco Santander has reduced its workforce in Portugal and the UK by more than 3,000 employees in the last year, these two geographies concentrating the layoffs made by entities in Europe since mid-2021, as reflected in the bank’s corresponding financial statements for the first half of 2022.

Santander had 20,320 workers in the UK in June, 2,131 less than the previous year, while Santander’s Portuguese subsidiary had 4,977 workers, 1,072 fewer than in June 2021. In that period, the branch network in the UK was reduced at 103 branches, to 450, and in Portugal decreased by 32 offices, up to 386.

Bank sources consulted by Europa Press confirmed that the cuts were in response to restructuring processes carried out in the two countries last year. In fact, the annual accounts for the first half of 2021 include an impact of 293 million in the UK and 165 million in Portugal according to restructuring costs in both countries.

In Portugal, Santander is reducing the number of branches and digitizing most of the process, taking into account changing customer habits and the process of digital transformation of banking, which is accompanied by a reduction in the workforce.

Entities give preference to individual agreements, in accordance with Portuguese regulations, which cover benefits greater than legally defined, health plans, placement programs, and early retirement proposals.

Santander hired independent legal counsel to review negotiations and contacts with employees and designed a program to support workers leaving the entity in their new personal and professional stages, steps that allowed Santander Portugal to come to an agreement with nearly 96% of employees affected by the workforce reduction. The remaining 4% (49 employees) are affected by the collective dismissal process.

In the UK, the reduction in headcount is a consequence of the office closures announced in early 2021 due to an increase in digital clients accelerated by the pandemic, the closure of four headquarters and other consolidations in five key locations.

In the case of Spain, on the other hand, the workforce has increased by 120 workers and 30 offices have closed since June 2021, because on that date the Employment Regulation File (ERE) was practically realized, which meant the departure of 3,572 employees in the country. and the closure of 1,033 offices (34 of which are pending closure). In Poland, the workforce increased by 25 employees, to 10,468, and 58 offices were closed, maintaining a network of 413 branches.

Regarding other regions where Santander is present, the bank’s workforce also decreased in the United States by 667 people, to 14,943, in Chile by 707 people, to 9,921, and in Argentina by 300 people, to 8,514 workers. In contrast, Santander added 8,628 employees in Brazil, to 53,743, and 2,693 in Mexico, to 28,236.

The workforce also increased in the Digital Consumer Bank by 60 people to 15,894 people, and in the corporate center by 68 people to 1,811 people.

IMPROVING EFFICIENCY RATIO

Banco Santander’s transformation plan aims to achieve an integrated and more digital operating model across the different geographies in which it operates to achieve greater efficiency and gain productivity.

In the first half of 2022, the group put its operating costs at 11,435 million euros, 10% higher than the same period a year earlier (and 5% higher without exchange rate impact), due to high inflationary increases. . In real terms (excluding the increase in average inflation), costs fell 4% in constant euros.

In Europe, costs fell 1% year-on-year in constant euros and 7% in real terms. Excluding the increase in average inflation, the reduction in costs was 17% in Portugal, 11% in Spain, 5% in the UK and 1% in Poland.

Overall, Santander’s efficiency ratio in Europe increased by 3.9 percentage points this year, to 48.5%. At the group level, it reached 45.5%, 0.2 percentage points below the previous year.