According to Bank of Portugal, banks operating in the country cut almost 13,000 employees and closed more than 2,000 branches in the last 10 years.
Banks operating in Portugal cut almost 13,000 employees and closed more than 2,000 branches between 2009 and 2019, according to the update of the long series of the Portuguese banking system of the Bank of Portugal.
According to the information released on Thursday, in 2019 there were 45,884 workers in the domestic bank industry operating in Portugal, 12,945 fewer than the 58,829 of 2009.
The year 2019 had the fewest bank employees since the beginning of the series in 1990. The highest figure was reached in 1994 with 61,512 people working in banks in Portugal.
In terms of branches in Portugal, the banks had 4,013 in 2019, 2,385 fewer than the 6,398 in 2009.
The 4,013 branches in 2019 represented the lowest figure since 1994 (when there were 3,595). The highest number of branches was reached in 2010 with 6,453 branches in Portugal.
According to the bulletin of the long series of the Portuguese banking system 1990-2018 (still without the 2019 data released today), after the significant growth of employment in the banking sector in the 1990s, it has been declining and especially in recent years.
Compared with other European countries, the Bank of Portugal bulletin states that the share of the banking sector in total employment is lower in Portugal, which also reflects “the smaller size of the sector in the Portuguese economy”.
In 2018, in the euro area, out of every thousand people, 5.4 were working in the banking sector, while the figure was 4.5 in Portugal.
As for the branches, the bulletin stated that the number “more than doubled in the 1990s from fewer than 2,000 in 1990 to around 5,300 in 2000” and that “after some stabilisation in the first five years of the new millennium, there was a further increase in the following years, peaking at around 6,500 in 2010”.
Since that year, and especially from 2013 onwards, “the number of branches has fallen sharply.”
The downward trend in the number of branches, according to Bank of Portugal, is also common to the euro area and even higher in relative terms in Portugal.
In 2018, the number of branches per million inhabitants was 405 in Portugal and 395 in the euro area.
The reduction in the structure that banks have made will continue in the coming years and several institutions have even come to take it up publicly, using cost-cutting as a measure to cope with the current crisis, weak profitability and digitization of operations.
Among the major Portuguese banks, Montepio has already acknowledged that it has a broad plan for workers’ exit, which could involve between 600 and 900 people.
BCP said in April, at the start of the Covid-19 crisis, that it would postpone the reduction of workers that it had planned for this year (in a stance that it called “social responsibility”), but that it would do so in early 2021.
Santander Totta is calling for workers to propose mutually agreed layoffs, but without putting forward numbers of how many workers it wants to be laid off.
Caixa Geral de Depósitos will continue this year to comply with the reduction in staff agreed in the restructuring plan with the European Commission, which will involve the departure of 250 workers in the second half of the year (in addition to the 179 who left by June), but the management has already admitted that more departures could be envisaged in the 2021-2024 plan.
In relation to Novo Banco, the Banking Technical Staff Union said in mid-September that the institution “has been presenting proposals for early retirement and termination of employment contracts by agreement to a group of workers.