Italian bank UniCredit is
poised to cut 18,200 jobs by 2018 including through the sale of
its Ukraine subsidiary and a joint venture involving its Pioneer
unit, the group said Wednesday.
Some 6,900 of the job cuts will be made in Italy.
The three-year plan approved by the board of directors
also includes cost-containment measures worth 1.6 billion euros
and the sale or restructuring of low-profitability businesses in
Austria and Italy by the end of 2016.
In a statement, UniCredit said the plan sets a profit
target of 5.3 billion euros.
The bank, Italy's largest by assets, plans to close 800
branches in Italy, Austria and Germany by the end of 2018,
according to the new plan.
At that point, it will have 111,000 full-time staff, the
plan said.
Also part of the plan is a joint venture of UniCredit's
Pioneer asset management operations with the Santander banking
group.
"We have approved a plan that is rigorous and serious and
at the same time ambitious," CEO Federico Ghizzoni said.
"In particular it is realistic because it is based on
actions that depend on our management choices and is completely
self-financed," he added.
On Wednesday Unicredit posted a profit of over 1.5
billion euros for the first nine months of the year, down 16.1%
over the same period in 2014.
The 400-million-euro devaluation of its Ukraine
subsidiary and the conversion to euros of loans in Swiss Francs
in Croatia negatively impacted its performance.
The third-quarter results also include an expected
continued fall in non-performing loans, to some 50.6 billion
euros.
Shares in the lender extended earlier gains after the
release of the business plan to trade up more than 3%.
UniCredit is the latest major European bank to launch an
overhaul to boost profits and increase capital.
UniCredit Group is an Italian global banking and financial
services company with a network spanning 50 markets in 17
countries.
Its strategic position in Western and Eastern Europe gives
the group one of the region's highest market shares.
The company is a component of the Euro Stoxx 50 stock
market index.
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