The takeover bid for Sabadell will result in up to 31,500 layoffs, warns UGT.

BarcelonaWhat can it be? The global employment impact of BBVA's takeover bid for Banc SabadellBeyond the employees of both entities who would lose their jobs due to the duplication generated by the takeover, UGT warned this Monday that the impact would be even greater if we add the indirect job losses: both in the affected subcontracted companies (cleaning, security, customer service, maintenance, or logistics) and in the SMEs that would be affected.

In the presentation of a report outlining its position on the operation, the union estimates that between 7,500 and 10,500 direct jobs would be destroyed, to which indirect jobs would have to be added, which would be double these figures. This implies that the range of these layoffs could extend to between 22,500 and 31,500 people. The union has once again called on the Spanish government—this Tuesday, Economy Minister Carlos Cuerpo, after analyzing the public consultation on the merger, must decide whether to raise the issue of the takeover bid to the Council of Ministers—to toughen the terms of the operation to make it "unviable" to go ahead.

The union's analysis concludes that if its calculations are applied to the Banc Sabadell workforce in Catalonia, the direct job loss figure would be between 2,400 and 3,200, to which double the number of indirect losses would also be added. In other words, the employment impact in the Principality would rise to a minimum of 7,200 workers and a maximum of 9,600. "We're talking about stable jobs with quality conditions and above-average wages. People who lose their jobs will be unlikely to find another with similar conditions, and this could end up leading to a decline in the quality of the labor market," argued Cati Llibre, deputy secretary of the union in Catalonia.

On the other hand, the UGT also warns of the deteriorating working conditions for employees who remain at the bank resulting from BBVA's takeover of Sabadell. Llibre emphasized that these mergers have seen an increase in the workload among the workforce because job losses mean fewer people are able to do the same work. "There is more overtime, there are high levels of stress and anxiety, and psychosocial risks and work-related disabilities increase," the union member emphasized. Furthermore, the union points out that since 2008, Spain has experienced a very sharp drop in the number of bank employees relative to the population: from 601 employees per 100,000 inhabitants to 335. This places the country in fifth place in Europe in terms of this indicator.

The union also highlights the impact of BBVA's takeover bid for Sabadell in terms of massive branch closures: it forecasts the closure of between 600 and 900 customer service points nationwide; and between 170 and 260 in Catalonia. Furthermore, it estimates a drop in available credit of more than €54 billion, "with warnings that in certain scenarios it could reach €75 billion." This impact would be more significant for SMEs, the self-employed, and families with lower savings capacity, who have fewer options for accessing alternative financing and are more dependent on traditional banks. UGT includes the loss of decision-making centers in Catalonia and the increased banking concentration among its arguments for opposing the takeover bid.

Systemic and "moral" risk

Regarding the risks posed by an increase in financial oligopoly, Llibre also mentioned the increase in systemic risk, that is, the consequences of the takeover bid on the stability of the financial system as a whole. "The resulting entity would be so large that it would be considered too big to fail (too big to fail), and if it did, it would require the intervention of public authorities to prevent collapse, with an impact on the pockets of workers," said the union member. In fact, UGT also sees an increase in "moral hazard," a concept by which the executives of the resulting bank can make riskier decisions: "The larger a bank is, the more influence it can have over results and the more difficult its effective supervision becomes."

and the possible dismissal of 5,000 workers from both entities as a consequence of the takeover process. She also pointed out that it will make financing more expensive for Catalan SMEs and families affected by the takeover, and that financial exclusion will intensify.