Updated: National Bank to cut 600 employees, add 500

National Bank says it’s planning to cut 600 employees — and another 300 will be affected through “proactive reassignment and retirement programs” that will be implemented over at least a year — as it adapts to technological shifts in the banking industry.

At the same time, the Montreal-based bank expects to fill at least 500 other positions over the same period, primarily in sales and service and information technology jobs.

“The shift to a digital economy offers tangible growth opportunities for National Bank, but requires us to remain agile and efficient in fully meeting client expectations,” National Bank president and CEO Louis Vachon said in a release Thursday.

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Vachon adds: “The measures currently being announced will affect a number of employees. The bank will make every effort to reduce the impact by offering a targeted retirement program under specific conditions, reassignment and career transition programs, and severance packages consistent with market best practices.”

National Bank says it will take a restructuring charge of about $128 million after taxes, or 38 cents per share, in Q4 of its financial year ended October 31.

National Bank says in a release it’s pursuing restructuring initiatives it began last year in order to accelerate its transformation plan, meet the changing needs of its clients and achieve greater operating efficiency. The restructuring charge includes employee severance payments and premises optimization, and the bank expects to realize roughly $120 million in annual pre-tax savings.

The release doesn’t say where the 600 staff cuts will come from.

The charges will reduce the bank’s common equity tier 1 capital ratio by 14 basis points. National Bank estimates its CET1 ratio will be approximately 10% as of October 31. The company will report its full financial results on Dec. 2.

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According to its most recent financial report, National Bank had 19,860 employees in Canada and 1,871 outside the country as of July 31.

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Staff, with files from The Canadian Press

The Canadian Press is a national news agency headquartered in Toronto and founded in 1917.