Portugal’s Big Five Banks Shed 283 Jobs in First Half of 2026 as Branch Networks Slim

Portugal’s Top Banks Cut 283 Jobs in First Half of 2026

The aggregate headcount of Portugal’s five largest banks fell by 283 year-on-year to 25,085 at the end of June 2026, according to first-half reports. The decline was driven primarily by cuts at Caixa Geral de Depósitos (CGD), Millennium bcp (BCP) and Santander Totta, while BPI and Novo Banco added staff net.

BCP shed 228 employees, ending the period with 5,996; CGD reduced its payroll by 218 to 5,774, and Santander Totta saw 139 people leave, leaving it with 4,527 workers. Santander Totta also disclosed an early-retirement programme and branch reductions costing €25 million this year. CGD has announced plans to hire 1,000 people over five years for AI and data roles, but annual departures keep its net number declining.

The branch footprint of the five banks shrank by 44 outlets to an aggregate 1,785. Santander Totta closed the most—66 branches—now operating 261. BCP cut 11 branches to 385, while BPI added five to 308, Novo Banco added 11 to 302, and CGD increased its network by 17 to 529 (including company centres). The broader sector saw 3,182 branches at end-2025, down 102 from 2024, with the Bank of Portugal highlighting that 1,241 rural parishes now have no physical access to cash.

Divergent Strategies and the Digital Shift Reshape Banking Employment

A Tale of Two Paths: Cuts at the Top, Growth at Others

While the three largest retail banks by domestic workforce all trimmed staff, BPI and Novo Banco bucked the trend. BPI’s net addition of 276 workers to 4,630 was the biggest swing, suggesting a deliberate bet on talent to capture market share or improve service in a consolidating market. Novo Banco’s modest increase of 26 to 4,158 keeps it roughly stable, not yet indicating a clear growth strategy. The divergence shows that the sector’s adjustment is not uniform; some institutions are prioritising cost efficiency, while others see an opportunity to expand headcount selectively.

The Tech Talent Rebalancing Act

The net headcount reductions mask a profound internal churn: banks are letting older, more expensive employees go—often through early retirement and mutual agreements—and replacing them with younger, digitally skilled hires. CGD’s pledge to recruit 1,000 people for AI and analytics illustrates this pivot. The payoff is lower average salary costs and a workforce better suited to digital banking, but the transition carries risks of losing institutional knowledge and creating service gaps during the handover period.

The BNP Paribas Factor

Nationwide banking employment actually rose for the fourth consecutive year, reaching 60,321 at end-2025. The Bank of Portugal cautioned that this does not reflect a reversal of the sector’s long adjustment; rather, it is largely driven by BNP Paribas’s operations centre in Portugal, which employed over 9,700 and aims to surpass 10,000 by end-2026. As a non-retail entity servicing global group functions, its expansion tells a different story from the domestic retail cuts, underscoring Portugal’s attractiveness for shared services rather than a revival of traditional branch banking jobs.

Branch Closures and the Access Gap

The physical network contraction is accelerating at Santander Totta, which cut more branches than any peer, and continues at BCP. This leaves more rural parishes reliant on digital channels or the remaining multi-function ATMs. The Bank of Portugal’s study identifying 1,241 parishes without cash access points puts pressure on banks and regulators to address financial exclusion. While digital adoption may be high, the absence of branches can erode trust and limit service for elderly or less tech-savvy populations, a risk that could prompt regulatory intervention.

What Bank Executives and Regulators Should Watch

• Track regulatory posture on branch deserts. The BdP’s finding that 40% of parishes lack physical access to cash may lead to minimum presence requirements; banks should scenario-plan for mandated branch or ATM obligations, particularly in rural zones where Santander Totta and BCP have pulled back.
• Weigh Santander Totta’s aggressive cost-cutting. The €25 million early-retirement provision and 66 branch closures represent a clear pivot; competitors should assess whether similar moves will trigger labour disputes or regulatory pushback, and whether a rushed reduction could hurt customer retention.
• Prepare for a talent war in tech-savvy hiring. CGD’s plan to hire 1,000 AI and data professionals signals a sector-wide demand for digital skills. Banks that cannot attract and integrate these workers risk falling behind on automation and customer experience.
• Monitor BPI’s expansion. The bank’s net addition of 276 staff—the only significant organic increase among the big five—may translate into improved service quality and market share gains. Rivals should review retention strategies for client-facing staff.
• For investors: watch cost-income trajectories. Branch closures reduce operating expenses but also alter revenue generation; Santander Totta’s numbers in coming quarters will reveal whether deposit and loan volumes hold up in areas that lost physical access.