Drastic Cuts

Unicredit Trims the Fat

Italy's largest bank Unicredit has some lean years ahead. Credit: Bloomberg
Italy's largest bank Unicredit has some lean years ahead.
  • Why it matters

    Why it matters

    UniCredit is just the latest of several big European banks to announce a restructuring to boost capital and increase flagging profits.

  • Facts

    Facts

    • The restructuring program is aimed at saving €1.6 billion in costs in the next three years.
    • UniCredit’s CEO pledged to refrain from any more capital hikes and to raise the core capital ratio to 12.6 percent.
    • UniCredit’s German operations will escape comparatively unscathed with 1,200 layoffs. Job cuts in Austria and Italy will be much bigger.
  • Audio

    Audio

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Wednesday was a day of truth for Unicredit. Italy’s largest and most international bank announced a drastic restructuring to save €1.6 billion, or $1.72 billion, in the next three years.

Unicredit Chief Executive Federico Ghizzoni presented shareholders with a plan to slash 18,200 jobs at the troubled bank, with about 6,000 layoffs coming from the sale of asset management unit Pioneer and the bank’s Ukraine operations.

The makeover is even more radical than the 10,000 job cuts expected, but won’t affect Unicredit’s German subsidiary Hypo-Vereinsbank that much. About 1,200 administration jobs there will be lost, which was in line with forecasts.

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