The managements of the four systemic banks in Greece are anticipating a change in labor law in order to push forward with their reorganization plans, which will primarily focus on selling off subsidiaries, closing store branches and laying off employees.
Based on the plans that have been submitted to the European Commission’s general directorate of competition, the four bands want to reduce their employees by 6,000 by the end of 2017. The banks want to shut down about 10% of their branches, to bring the total from 2,500 to 2,250 stores across Greece.
Given the high cost of voluntary redundancy programs, the banks are more likely to focus on dismissals and retirements. The National Bank and Piraeus Bank will have to lay off the most employees, since they have received the greatest amount of state support to cover their capital needs. Piraeus Bank and Alpha Bank have committed to shutting down about 200 stores.
The banks will also have to scale back their overseas activities and overall presence, due to the state support they received in 2015. This process has already begun with the sale of the National Bank’s Turkish subsidiary Finansbank. The Greek banks are expected to sell, trade or merge their subsidiaries in the next few months. Additionally the banks are also set to begin divesting from non-banking activities, such as their real estate activities.
