Munich Re, the world’s biggest reinsurer, will cut as many as 1,350 jobs in Germany at its Ergo Versicherungsgruppe insurance unit to reduce costs by about 164 million euros ($201 million) a year.
Ergo’s management will discuss the measures to be implemented by the beginning of 2014 with employee representatives, the Dusseldorf, Germany-based Munich Re division said today in a statement. Ergo employed 19,588 people in Germany at the end of March, meaning the cuts represent 6.9 percent of its workforce in the country.
Munich Re, led by Chief Executive Officer Nikolaus von Bomhard, plans to more than triple profit to about 2.5 billion euros this year. The elimination of the positions, which support insurance agents, boosts the number of job losses announced by Western European financial firms this year to almost 24,000, data compiled by Bloomberg show.
Ergo will reorganize its five sales divisions into two with “competitive size and unified structures,” the company said. The insurer will seek to eliminate positions through early retirement and by moving employees to other jobs at the company, Alexandra Klemme, a spokeswoman for Ergo, said by telephone.
First-quarter profit at the insurance unit, which mostly consists of Ergo, rose to 145 million euros from 53 million euros a year earlier, Munich Re said May 8.