Credit Agricole pledges cost cuts without layoffs -sources

Thu Dec 20, 2012 3:21pm EST

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PARIS, Dec 20 (Reuters) - French lender Credit Agricole has told staff representatives it will focus on cutting costs at its investment bank without a new layoffs plan, sources said.

Credit Agricole is seen as the weakest of France's listed banks in terms of capital strength and made deep cuts to investment bank staff and costs earlier this year.

Staff representatives say they have met with management twice this week over future strategy.

"There will be no new layoffs plan, the focus is on finding other cost savings over the next three years," a source who attended a meeting on Thursday said.

There will be a focus on savings to back-office and IT costs, on finding cheaper real estate and on non-replacement of retirees, the source said.

A union representative told Reuters that management said there was no layoffs plan in the works but management had been vague in a meeting earlier this week.

"They were vague and said the bank was concentrating on broad cost reductions," he said.

The effort to cut costs through attrition will not be confined to the investment bank, a separate union source said, adding that not all departing staff at the lender's regional savings banks would be replaced either.

Staff at the regional banks could be cut by about 1,400 in 2013, the source said, citing documents provided by management, showing that only 2,707 people would be hired to replace departing staff estimated at 4,125.

The regional savings banks employ 66,375 workers on permanent contracts.

A spokesman for the regional banks, which are cooperatives which jointly control the listed Credit Agricole SA unit, said the figures were only rough estimates and that it was not the first time the bank had trimmed jobs through attrition. (Reporting By Lionel Laurent and Christian Plumb; editing by Andrew Hay)

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