Wednesday 11 November 2015 2:15 pm

Italian bank UniCredit to cut 18,200 jobs

Italian bank UniCredit is planning to cut 18,200 jobs by 2018 in an acceleration of cost cutting measures.

The bank today unveiled a strategic plan to become more efficient and profitable, planning to slash thousands of jobs as well as focus on "the new digital agenda, underpinned by €1.2bn in investments over 2016-18", in order to accelerate the group's retail and corporate multi-channel transformation and "create further discontinuity from traditional banking", the bank said.

UniCredit is the latest in a string of banks around Europe to announce job cuts, including HSBC, Barclays and Deutsche Bank

In a largely trailed move, the plan is for UniCredit to become a "simpler and more integrated group", cutting costs by €1.6bn.

Chief executive Federico Ghizzoni, said:

We aim at these goals in a persistently tough macroeconomic environment, marked by historically low interest rates and decelerating worldwide economic growth. The plan is rigorous and at the same time ambitious.

Above all, it is a realistic plan, as it is based on our managerial decisions and it is a totally self-financed plan.

The move involves exiting or restructuring poorly performing businesses, such as retail banking in Austria and leasing in Italy.

"We can now concentrate on reinforcing our European commercial bank franchise with significant cost containment measures and further discontinuity actions, and by exiting or restructuring poorly performing businesses, Ghizzoni added. "We are planning a considerable level of investments for the future, including €1.2bn only in our Group's digital evolution."

The bank is also aiming for a common equity tier 1 ratio of 12.6 per cent to allow for a substantial dividend pool available for distribution "corresponding to an average pout of of 40 per cent".

UniCredit also announced group net profit of €507m in the third quarter of 2016, while it said it is aiming for group net profits of €5.3bn in 2018.