Bancpost Plans More Staff Cuts After Q1 Loss

05.31.2011 ZF English

Romania’s ninth-largest bank by assets Bancpost, controlled by Greek financial group Eurobank EFG, is readying new cost cut measures, including personnel layoffs, following a loss of EUR1 million reported in the first quarter, people familiar with the matter told ZF.

"As many as 700 people will be laid off," the mentioned sources said. They said the first dismissals will take place in June, followed by a second wave in the fall.

Most layoffs will affect the staff at Bancpost's headquarters in Bucharest.

This would be the second round of drastic cost cuts at Bancpost, after Eurobank imposed a harsh restructuring program in 2009, which led to a 10% cut in personnel.

Mihai Bogza, Bancpost's chairman of the board, rejects the hypothesis of such drastic headcount adjustments, while he reckons that new cost-cutting steps are being prepared.

"These are groundless rumors, completely not in line with reality," Bogza said. Making another 700 employees redundant would mean slashing the bank's headcount by 20%.

"We are considering cuts in both personnel spending and in other types of expenditures. For instance, we are actively negotiating with the owners of the spaces we rent to get a rent cut, as they are still at extremely high levels compared with today's realities," Bogza said.