Spain’s largest bank to slash 3,000 jobs

Spain’s largest bank CaixaBank has planned to cut 3,000 jobs, which accounts for 10 percent of workforce at the financial institution.

According to a statement released by the bank, the layoffs are needed after the purchase of smaller banks Banca Civica and Banco de Valencia which has caused an increase of personnel.

“In order to adapt to the current environment and improve the efficiency of resources, and following the recent integration of the savings group formed by Banca Civica and the forthcoming incorporation of Banco de Valencia, CaixaBank considers it necessary to carry out a restructuring plan,” said the bank.

The bank’s net profit took a hit of 78.2 percent to USD 312 million (230 million euros) in 2012 versus the previous year, due to asset relocation to cover potential real-estate losses.

The layoffs signify the impact of the eurozone crisis on the banks. Caixabank, like other European banks, have struggled with the economic downturn in Europe.

Spain’s banking sector has lost over 28,000 jobs between 2008 and 2011, with experts predicting the country’s bank sector to lose 20,000 more jobs in the next five years.

In 2012, Prime Minister Mariano Rajoy lobbied the European Union for a rescue loan of up to USD 130 billion (100 billion euros).

Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008.