Danske Bank to Cut 7% Staff for Cost Reduction

It is aiming to become a ‘better bank’ by 2023.

Denmark’s biggest lender, Danske Bank has become the latest to reduce its workforce, as on Thursday it revealed its plan to cut 1,600 jobs in the next six to twelve months.

This came as part of the Danish bank’s plan to reduce operational cost, a two-year strategic program that will run through 2023.

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“It is never easy to reduce the number of colleagues, and we will do our best to ensure that we do this in the most decent and respectful way,” Danske Bank CEO, Chris Vogelzang said in a statement.

“However, we need to adapt to the structural changes that the financial sector is experiencing, and to remain competitive in a low-margin and highly competitive market, we simply have to reduce our costs.”

The bank currently employees a total of 22,000 employees, out of which 11,000 are based in Denmark. This workforce increased in recent years as the total count was around 20,000 in 2017.

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For the upcoming exits, the Danish bank is additionally offering its employees a voluntary redundancy agreement for most of its departments.

Danske already laid off 1,000 employees since June of last year and is currently on a hiring freeze.

“Together with the existing hiring freeze, we hope that it can help reduce the number of actual layoffs at a later time,” Karsten Breum, the bank’s HR head, said.

Becoming a ‘Better Bank’

The bank’s received a massive blow to its reputation earlier for its involvement in the €200 billion money-laundering scandals and is also struggling with the impact of negative interest rates.

Meanwhile, other big banks including HSBC have already mapped their plans to reduce a significant portion of their workforce.

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