and the unions closed the agreement this afternoon, after several weeks of high tension that led to . Since then and after the improvements made by the bank, social peace returns to the bank. The entity has quantified the cost of this ERE at 960 million, including the closure of 480 branches (240 million).
The layoffs will affect more than 9% of the group’s workforce in our country, a figure that is well below . BBVA has reduced the number of those affected by more than a thousand since the start of the negotiations and, in addition, has raised the conditions for departures.
Two thirds of the layoffs will occur in the branch network and voluntary will prevail, although the entity reserves the right to force layoffs in the event that there are areas where problems of labor force deficit arise.
Regarding the conditions, the agreement reached establishes early retirement from the age of 50, with a maximum of up to 75% of salary and a special Social Security agreement, after an increase at today’s meeting. Below that age, dismissals will be compensated with 40 days per year worked with a maximum of 30 monthly payments, which are improved compared to those of Friday. In both cases, the conditions have been widely raised in recent days by the entity in order to be able to reach an agreement.
BBVA, in order to reduce the number of those affected, has undertaken to relocate almost 700 employees internally to departments not affected by the ERE; in addition to offering 210 furloughs and limiting the number of offices that will close to 480, compared to the 530 initially planned.
The unions, during the negotiation, have managed to get the bank to eliminate the generational balance clause that forced the departure of 50% of those affected under 50 years of age. According to the pact, 72% of the casualties will correspond to those over that age.
Throughout the months of June and July the period of voluntary adhesions to the employment regulation file will take place, which will end earlier for the group of central services and intermediate departments.
Savings of 250 million in 2022
With this adjustment, the entity seeks to increase operating efficiency. BBVA has estimated cost synergies at 250 million from 2022, of which 220 will correspond to personnel costs. By 2021, the reduction in the bill will be approximately 65 million.
The bank will record the impact of the cost derived from the staff cut in the second quarter and quantifies the reduction in its top-class capital ratio at 28 basis points. This reduction will be more than offset by the sale of its US subsidiary, which generates an income of 9,600 million and excess solvency of more than 8,000 million.
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