(Bloomberg) -- Banco Bilbao Vizcaya Argentaria SA said it will cut 2,935 jobs in Spain, far fewer than originally planned amid weeks of government criticism against lay-offs in the banking sector.
BBVA reached an agreement Tuesday with unions, which is a mandatory legal step in Spain, on the job cuts in a process that will cost about 960 million euros ($1.2 billion) before taxes, the Madrid-based lender said in a statement. The cuts, which include closing 480 branches, will lead to a reduction in the bank's main regulatory capital ratio of about 28 basis points.
BBVA announced plans in April to cut 3,800 jobs, around the same time as CaixaBank SA laid out its intention to remove about 8,000 posts amid the takeover of Bankia SA. The two banks' plans were met by an outcry from several leading government officials, most notably Economy Minister Nadia Calvino, and both have now trimmed their original numbers.
Read More: CaixaBank Reduces Planned Job Cuts to 7,605
At the time, Calvino said that jobs cuts were not appropriate in current economic circumstances. Calvino also targeted bankers' “unacceptable” high salaries.
BBVA Chairman Carlos Torres said in April that the job cuts were necessary to guarantee the bank's sustainability due to conditions in the sector and the broader economy, as well as historically low interest rates.
The cost of the cuts will be recorded in the second quarter and generate estimate savings of approximately 250 million euros annually before taxes starting in 2022.
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