Yearly $223 million to be saved after Banco do Brasil overhaul

Brazil's government-run Banco do Brasil is expected to shut down a number of its branches, expand its online services, launch a retirement incentive plan, and propose a reduced amount of work hours for some of its employees. The overhaul, says bank President Paulo Caffarelli, should lead to approximately $223.77 million saved every year.

A Sunday (Nov. 20) market announcement on the reform, set to take place in 2017, says the bank expects the shutdown of 31 local superintendencies and 402 branches, in addition to the 51 closed in October this year. Another 379 branches will be turned into service stations.

The plan to expand digital channels includes the creation of over 255 digital service units—an addition to the current 245. These units serve a total 1.3 million clients, expected to rise to 4 million by the end of 2017. The changes should also lead to the elimination of 9.3 thousand job posts.

“Banco do Brasil isn't firing anyone. We'll have a reduction in positions stemming from the closure of branches,” Caffarelli said. Today, with its 109,1590 employees, he adds, the bank spends a yearly $900 million more than private banks.

Retirement

An incentive will be offered in exchange for voluntary terminations corresponding to 12 salaries, plus compensation for work time, which may vary from one to three salaries for adherents. According to a simulation by the institution, if the 18 thousand employees who meet the requirements for retirement join the program, annual spending will be slashed by over $900 million.

“The move aims at making Banco do Brasil stronger, looking ahead, so it can play its role as a commercial bank and also its social role as a development bank,” Caffarelli declared.

Translated by Fabrício Ferreira