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Nordea, one of Europe’s largest banks, is expected to slash jobs despite reaping more than 4 billion EUR in profit during the last year.

The Nordic finance giant has announced a total 900 million EUR savings plan for the next two years after a similar move in 2011 cost around 2000 jobs. The unacceptable cuts come at the same time as planned salary increases for Nordea board members.

Nordea, which employs 32,000 staff, is one of 29 global banks formally appointed SIFI (Systematically Important Financial Institution) – an institution whose failure might trigger a financial crisis. Chairman Bjorn Wahlroos has implemented a die-hard focus on achieving and maintaining an unrealistic 15 per cent return on equity despite a slow economy. Other banks have reduced their returns targets in the face of the financial crisis.

UNI Global Union General Secretary Philip Jennings has written to Nordea to demand that any cost-cutting should not come at the expense of jobs.

“Nordea has huge power and influence in European banking and its actions have a profound influence on European society. It must consult with trade unions and other stakeholders before implementing such drastic measures simply to further fill the pockets of its board members,” Jennings said.

“The stress placed on the shoulders of bank workers by restructuring and cost-cutting has caused a health crisis in the financial sector and it simply must stop.”

“Furthermore, if we allow banks such as Nordea to become ever-larger we will create a systemic risk in society and sleep walk straight back into another global crisis.”

The faith in shareholder value and short-sightedness, of which Chairman Wahlroos is a dedicated disciple, was what caused the financial melt down. This should not be a lesson yet needed to be learnt again.

Nordea’s website says it wants to “attract, develop and retain highly motivated, competent and performance-orientated employees.” CEO Christian Clausens total salary in 2012 amounted to 1,954,537 EUR – a 19.3 % increase from 2011.

“It is deeply incomprehensible when Nordea today accompanies this account with a doubling of the already huge savings plans for the group over the next two years. It evokes the bitter experience of great concern on the employees' behalf, for it is unfortunately often here where a cost reduction ends,” says Michael Budolfsen, President of Nordic Financial Unions and Vice President of UNI Finance.

“Though Nordea does not state specifically clear where and how the money should be found, it's probably noticed by employees who have gritted their teeth and worked hard to get Nordea through the crisis."
Chairman Bjorn Wahlroos stated publically at a finance union meeting that the only responsibility Nordea has to society is to pay its taxes. Furthermore, he said selling financial products are “like selling bananas,” for which the only concern is getting the highest price possible for shareholders.

Unions fear that Nordea’s power and influence at a European level could lead to other banks adopting similar damaging cost-cutting measures. UNI Finance calls for tighter regulation of banks through the European Commission and the Financial Stability Board. It says that bank success should not only be driven by profits and regulation but morals and ethics, which, it says, appears to be lacking from the Nordea board.