Postfinance is cutting more than 100 jobs as it realigns its business, according to information obtained by finews.com.

Hansruedi Koeng pronounced himself proud that Postfinance, the financial-services arm of Swiss Post, today has a bold strategy. He addressed his staff via a pre-recorded video message on Tuesday lunchtime – finews.com has seen the filmed address.

The new strategy, dubbed «Speed Up», was designed with a view to stop the rot at the company. Postfinance aims to become more cost-effective and competitive, according to the strategy which first had been presented in September.  

The management has now decided to divide the company into business, management and support units and to cut 129 jobs in the process.

Consultation Process

It will initiate a consultation procedure with the affected staff and present a redundancy plan. Postfinance furthermore will change the contracts of 264 members of staff.

The executive will take the final decision on the measures following the consultation procedure at the end of November and give notice to the first among the staff who are deemed surplus to requirements.

The natural turnover of staff will help the company shed a fourth of the 129 full-time-equivalents. A majority (75 percent) of the 264 contract adjustments will be accepted by the affected staff, said Koeng.

Retail Banking Hit Hardest

After the publication of today's report by finews.com, Postfinance sent a statement saying that it will also create new jobs. It is planning to make substantial investments into a new digital bank and the development of the platforms' business. For this, it needs additional staff with a wide array of competencies. That will lead to the hiring of about 80 new staff over the coming years

The cuts will affect retail banking most – where incidentally its asset management will be put. The company has decided to remove 88 jobs and adjust 150 contracts in retail banking.  Regions will be reorganized and synergies sought by putting functions under the same roof, mainly marketing and the physical distribution of products.

Payments will lose 10 jobs and get 11 contracts adjusted; strategy and transformation (HR, communications, innovation) will see 12 jobs go and 20 contracts adjusted; IT and operations has 19 jobs on the line and 83 contracts earmarked for change.

Impact of Loan Ban

In a question-and-answer round, members staff asked whether the government's consultation on the removal of the ban for Postfinance to lend money, which had returned mostly negative answers, had had an influence on the decision to cut jobs.

Koeng responded that there was an indirect, relative connection. If the consultation by the government had been positive with a prospect for an end to the loans-ban in the near future, maybe the jobs could have been converted. Thus, the cuts would likely have been smaller and the conversions of contracts more numerous.

Second Round of Cuts

Today’s announcement is the second within two years. State-owned Postfinance in 2018 had decided to remove 500 jobs to improve efficiency and to cut costs.

It had argued that margins had been eroded and revenue had fallen as a consequence. The loan ban had also featured strongly as a reason given for the cuts.