Italy’s biggest bank Unicredit to shed 8,000 jobs by 2023

Bank’s headquarters, the UniCredit Tower, in Milan. (Pixabay pic)

MILAN: Italian bank UniCredit said Tuesday it would eliminate 8,000 jobs in Western Europe and close 500 branches by 2023 to cut costs by €1 billion.

The measures, which were outlined in UniCredit’s 2020-2023 Strategic Plan, represent 12% of full-time equivalent (FTE) positions and 17% of its branches in Western Europe, the bank said.

Since taking over as head of UniCredit in mid 2016, French chief executive Jean-Pierre Mustier has reorganised operations with a reduction to date of 14,000 FTE and the closure of more than 900 branches.

The new plan was presented to investors in London and was estimated to represent cost savings of €1 billion.

Shareholders were offered an increased dividend meanwhile.

For the 2020-2022 period, UniCredit plans to pay 40% of net profit to shareholders, including 10% via a share buyback plan.

That compares with payment of 20% of net profit announced in 2016 and 30% in 2017.

In 2023, the sum is forecast to rise to 50% of the bank’s net profit.

In all, €8 billion are to be paid to shareholders between 2020 and 2023, of which €2 billion would come in the form of share buybacks.

UniCredit expects revenues to rise by an average of 0.8% annually between 2018 and 2023, to reach €19.3 billion, the statement said.