Edition 1497
20 October 2018
Edition: 1497

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Novo Banco plans to close 73 branches this year

in Business · 19-04-2018 14:40:00 · 0 Comments

Portugal’s Novo Banco bank plans to close 73 branches this year, bringing forward the target negotiated with Brussels, in addition to redundancies of 400 staff that had previously been announced.

Novo Banco plans to close 73 branches this year

Information from the Workers’ Commission to Novo Banco staff said it had met with the board of the bank, which said that “the targets to be reached by 2021 will be almost completely brought forward to the end of the first half of 2018”, both in terms of staff redundancies and reducing branches.
Novo Banco wants to cut over 400 employees this year, either through rescissions by mutual agreement or early retirement. The bank has set aside €134 million for this process.
The bank’s chief executive, António Ramalho, declined to disclose this information at the end of March, at the presentation of Novo Banco’s results, saying that he wanted to inform the bodies representing the bank’s workers before making this public information.
The information now released by the Workers’ Commission details that 73 branches will close this year.
At the end of 2017, Novo Banco had 473 branches, so the goal is this year to reach the target agreed with Brussels to reduce the network to 400 branches.
When these closures are complete, compared to the 631 branches that Novo Banco had at the end of 2014, the bank’s network will be 40 percent smaller.
As for the drop in staff, the period for staff to apply for terminations by mutual agreement ended on Friday, and there is still no information on how many have opted for voluntary redundancy. This process is due to be decided in May.
In terms of early retirement, the deadline for commercial network staff to apply has ended, and the period for the central service employees will now begin.
Last October, Novo Banco (the bank that kept the assets of the former BES bank, which was resolved on 3 August 2014) was 75 percent sold to US investment fund Lone Star with the Banking Resolution Fund (a State body financed by bank contributions) holding the remaining 25 percent.
Lone Star paid nothing in the deal, but agreed to inject €1 billion into Novo Banco, which it has already done.
In 2017, Novo Banco posted a record loss of €1.395 billion, in a year in which it filed impairments (provisions for potential losses) of over €2 billion.

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Edition 1497
20 October 2018
Edition: 1497

Read this week's issue online exactly as it appears in print.

Twitter

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