Volksbank to cut workforce, close hundreds of branches in major restructuring

Volksbank, the parent company of SNS, ASN, BLG Wonen, and RegioBank, announced plans to close up to 290 branches and cut 700 to 750 full-time jobs as part of a sweeping reorganization. The state-owned bank also set aside 340 million euros to 360 million euros to fund the restructuring, which will significantly impact profits but is expected to result in a net positive financial outcome for 2024.

The branch closures will reduce the number of SNS and RegioBank locations from 610 to between 320 and 360. Of the current 194 SNS branches, 110 to 130 will remain, while RegioBank’s network will shrink from 416 branches to 210 to 230. The changes include transitioning existing SNS branches under corporate management to a franchise model where feasible. Unviable locations will be shuttered.

The restructuring reflects Volksbank’s move toward a simplified operational structure and a unified retail brand, which is yet to be named. Roland Boekhout, CEO of Volksbank, stated the decision is necessary to improve the bank’s financial stability and competitiveness. "This allows us to maintain national coverage while aligning our services under one brand," Boekhout said.

Volksbank’s workforce will be reduced to support these structural changes, with layoffs expected by July 1, 2025. The branch closures and job cuts aim to save 70 million euros annually in operational costs. However, the bank acknowledged that these savings will be offset by rising compliance costs tied to combating financial crime.

The shift also includes the establishment of three flagship stores for financial advisory services, which will operate under corporate management. Customers of ASN Bank, which currently lacks physical locations, will gain access to local branches under the new structure.

In response to regulatory pressures, Volksbank has allocated part of the restructuring provision to address financial crime. The bank is implementing a comprehensive remediation plan to prevent money laundering and ensure compliance with oversight standards. Temporary external staff are being hired to expedite these efforts. The bank faces potential regulatory fines for past shortcomings in its anti-money laundering controls.

Volksbank has been state-owned since its nationalization in 2013 and operates with a network of around 4,500 employees. It expects to release detailed financial results, including the full scope of the restructuring costs, in its annual report scheduled for February 14, 2025.