CAM Bank to Close 122 Branches

Caja Mediterráneo (CAM) is continuing with its cost reduction plans, to be implemented this year, which will result in the closure of a total of 122 branches, 27% of their total network. The bank are confident the implementation of its recapitalisation strategy will yield “rather positive results”.

These cost reduction measures will see the closure of 1 in 4 of CAM’s branches during 2011, six months sooner than the official forecast. Fifteen closures have already been implemented to date.

Regarding staffing, the organisation said that since the approval of the redundancy plan (ERE) in June, they have already produced a reduction equivalent to 37% of the plan for 2011.

They also highlighted that as far as recurring overheads are concerned, the measures initiated during the second quarter of the year will allow a reduction of five points above the recapitalisation plan target for 2011, making the percentage reduction around 16%, excluding extraordinary items.

The Intention is to Save more than 200 Million Euros

The board of directors of Caja Mediterráneo approved the submission of their recapitalisation plan to the Bank of Spain late April and as a result, from now until the year 2015, it is projected the efficiency ratio will improve up to 50%, resulting in recurring savings of more than 200 million euros and profit levels above 15%.

As reported in El Mundo, the bank said that in developing the plan they “have been mindful of the new competitive environment and foreseeable market developments over the next five years, as well as regulatory requirements for solvency and liquidity.”

Thus, the approved plan “includes the development of various initiatives on operational restructuring and cost cutting measures designed to place the productivity and efficiency of the Bank at levels required in the new competitive and regulatory climate.”

Torrevieja