The Straits Times
Published on Nov 25, 2012

Spain to get EU bank aid in return for job losses: Report


MADRID (REUTERS) - European authorities will transfer 35 billion euros (S$55.5 billion) to Spain's state bank rescue fund on Dec 15 in exchange for massive layoffs at Spain's four nationalised banks, including state-rescued Bankia, El Pais newspaper reported on Sunday.

The cash injection from European bailout funds will be disbursed to troubled Spanish banks two weeks after it is paid into Spain's bank restructuring fund, or FROB, the paper said.

Bankia, which sought a 23.5-billion-euro bailout from the state in May, is expected to be forced to lay off up to 6,000 people from its current 20,000 staff, while NovaGalicia Bank is seen laying off 2,000 of its 5,800 workforce, said El Pais, citing European and banking sources.

Bankia and NovaGalicia Bank declined to comment on the report, which also said the banks would have to close 1,000 branches between the two of them.