MADRID: Spanish lender Bankia plans to lay off more than 2,500 staff due to the integration of smaller lender Banco Mare Nostrum (BMN), one of the country's biggest unions said on Monday.
State-owned Bankia agreed in June to acquire the part-nationalised BMN to boost earnings. It expects to complete the takeover, which will create Spain's fourth-biggest bank, this month.
On Monday the UGT union, one of the biggest representatives of Bankia employees, said the bank planned to lay off 2,510 employees, or around 14 percent of the merged entity's workforce. Around 1,120 of the job cuts would be at bank branches and 820 would be at the two lenders' head offices, it said.
Bankia declined to comment.
Like other Spanish lenders, Bankia is struggling to increase earnings as record low interest rates and rising competition erode margins.
Banks have been slashing costs, and closing branches, since a 2012 financial crisis, which pushed some into state bailouts.
Last week, the Spanish government sold a 7 percent stake in Bankia for 818 million euros ($967 mln) as it pushes ahead with its privatisation process.
The government, which has until 2019 to privatise Bankia, holds around 60 percent of the lender.
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