📉 European Banks Spend €1.1 Billion Axing Senior Staff
Headline: European banks have spent over €1.1 billion cutting ties with senior executives—commonly referred to as “material risk takers”—between 2018 and 2024, signaling widespread cost‑cutting and structural reshaping efforts.
🔍 Key Stats & Highlights
- Total spent: €1.13 billion in severance across seven major banks
- Number affected: 2,100 senior staff, averaging €540,000 per person
- Top contributors:
- Deutsche Bank, HSBC & Santander together paid ~€850 million
- Santander led with an average payout of €780,000 and the top single exit of €11.2 million in 2021
- Deutsche Bank matched with €11 million payouts in both 2018 and 2019
- Other banks—Société Générale, BNP Paribas, Barclays, UBS—spent around €275 million
🛠 Why Now? Deep‑cut Restructuring Momentum
- Strategic pivots & business realignments:
- Deutsche Bank’s overhaul in 2019 saw its equities trading exit and plan to cut 18,000 jobs by 2022 (falling short)
- HSBC made waves, with over 35,000 positions cut and investment banking retrenchments under successive CEOs
- Material risk takers have become prime targets: highly paid, strategically positioned senior roles that offer deep cost‑cutting leverage
💬 Industry Reactions & Recruiter Insights
An anonymous senior financial recruiter noted:
“It’s much harder to get on these [severance] lists than you might think. … The packages are also much more attractive today than they used to be.”
This insight suggests that while exits are generous, they remain exclusive and conditional.
📊 Bank‑by‑Bank Breakdown
| Bank | Est. Total Severance | # of Senior Staff Exiting | Avg Payout | Notable Details |
|---|---|---|---|---|
| Deutsche Bank | Part of €850M | 685 material risk takers | ~€540k | Two €11M individual exits |
| HSBC | Part of €850M | 400 senior exits | ~€678k | Investment banking reductions ongoing |
| Santander | Part of €850M | — | €780k | €11.2M single payout in 2021 |
| Société Générale, BNP, Barclays, UBS | €275M approx. | — | — | UBS integration included Credit Suisse severance ($735M to 5,700 staff) |
🧭 Broader Implications
- Expense management vs. talent flight risk:
Cutting senior roles slashes immediate costs—but losing leadership depth risks long‑term competitive positioning. - European‑vs‑US severance dynamics:
Lay‑off packages in Europe, especially for executives, remain notably more generous compared to American counterparts—potentially influencing hiring practices and mobility. - Banking sector shape‑shift:
This wave of severance reflects deeper shifts—declining traditional investment banking, re-allocated capital, and preparation for future business models.
🎯 Take-Home Messages
- Intentional restructuring: These aren’t mere one‑off layoffs—they’re strategic decisions to reshape institutions from the top.
- High price of agility: Reducing senior rank comes at a steep cost—but banks clearly see it as a worthwhile path to leaner, more adaptable operations.
- Watch for next moves: The remaining senior talent will shape the recovery or reinvention of these banks. Future performance will reveal whether these moves pay off.
