FINANCE: Bank of Cyprus to cut staff by 400 more

Bank of Cyprus is preparing an early retirement plan for 400 staff which is to be presented before some 3,700 employees, confirming rumours circulating since July. The bank’s plan is the fourth exit scheme prepared by the bank since the financial crisis of 2013 and its subsequent bail-in by depositors.

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BoC’s plans were confirmed by the bank’s new CEO Panicos Nicolaou during an interview with the Cyprus News Agency. According to Nicolaou, further details of the plan are to be announced on Friday, October 4.

BOC’s CEO said that the bank is undergoing a technological and digital transformation and that in this context, aiming to change its business culture.

Nicolaou said that the scheme will be “a generous one”, as the bank is expected to rationalise its costs following the exit plan. He noted that the bank’s cost reduction plans depend on the reduction of staff.

According to sources, quoted by Stockwatch, a one-off compensation package will be offered which will not exceed EUR 200,000, and will be calculated based on employees’ earnings and years of service, while their age will also be a factor.

The bank’s latest early retirement plan is expected to be along the lines of the previous one deployed in May 2016, when 450 employees had pressed the ‘exit button’.

All staff members of the bank and its subsidiaries will have the right to opt out, while it has yet to be made clear whether compensations given will be taxable.

Employees opting to leave, will not see the terms of any loans they have with the bank being affected, while they are expected to maintain their life and medical insurance policies for a period of two years after their retirement.