The restructuring events database contains factsheets with data on large-scale restructuring events reported in the principal national media and company websites in each EU Member State. This database was created in 2002.
Financial Services Financial And Insurance Activities Financial Service Activities, Except Insurance And Pension Funding 64 - Financial service activities, except insurance and pension funding
250 jobs Number of planned job losses
Announcement Date
4 February 2019
Employment effect (start)
5 February 2019
Foreseen end date
31 December 2019
Description
Luminor Bank announced on February 4 that it would be laying off around 800 employees in the Baltic states during 2019, including 250 in Latvia. Of these 130 employees will be dismissed in Estonia, 250 employees in Latvia and 420 employees in Lithuania. In total Luminor bank employs around 3,000 employees in the Baltic states, including around 1,000 in Latvia. The reason for the dismissals according to the information from bank is that it is “simplifying its operating modelâ€.
On 1 October 2017, following the decision of the European Commission to approve unconditionally the creation of a joint venture between Nordea Bank and DNB bank in the Baltic countries, the merger of two Nordic banks operating in Baltic states was completed. The new brand - Luminor bank - was introduced and claimed itself as the third biggest bank in the Baltic region. After completing the merger Luminor is now an Estonian-registered bank with branches in Latvia and Lithuania.
In September 2018 Nordea and DNBÂ agreed to sell a 60% stake in Luminor to the private equity consortium Blackstone for 1 billion EUR.
On 4 February 2019 the bank reported that “the company has entered its next phase of transformation and is changing its operating modelâ€. According to bank, “the new operating model foresees simplifying bank’s business processes and reorganizing duplicated functions and areas where new technological approaches and organisational solutions are being introducedâ€. The process also includes “decreasing team sizes†and “entering into a collective redundancy processâ€.
Redundancies will be carried out gradually during 2019.
The process should follow legislative provisions and the bank has promised to offer support to redundant employees, including workshops and individual coaching sessions.
Luminor bank informed that it had informed the relevant public authorities in Estonia, Latvia and Lithuania regarding its planned reductions, including trade unions in Estonia, the Financial Sector Trade Union of Latvia and the Labour Council in Lithuania.
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Sources
4 February 2019: Public broadcasting of Latvia (eng.lsm.lv)
4 February 2019: Public broadcasting of Latvia (www.lsm.lv)
Eurofound (2019), Luminor Bank, Internal restructuring in Latvia, factsheet number 96634, European Restructuring Monitor. Dublin, https://restructuringeventsprod.azurewebsites.net/restructuring-events/detail/96634.
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