On the basis of margin developments and the consequences of the reorganisation, EDB has carried out a fresh review of the staffing position in the Banking & Finance business area. This has revealed a need to downsize the workforce by about 105 people in the Nordic area to secure the necessary profitability.

 

After the reorganisation, EDB Bank & Finance will no longer pursue its own operations outside the Nordic region. The workforce will accordingly be downsized by a further 35 people. In total, the number of employees in the business area will be reduced by about 140 during the second half of 2003.

 

"The scope of this downsizing is the outcome of two assessments," says Ole Urdahl, Executive Vice president for Bank & Finance at EDB. "The first of these covers essential profitability requirements which the present organisation fails to satisfy. The second concerns the need for expertise and capacity in the new organisation to ensure that it has the strength to develop and solid technical teams. "We're now implementing more extensive changes in the way we organise our work than we've considered earlier. This means that we can achieve substantial efficiency gains while simultaneously strengthening our competitiveness and position in the market."

 

The downsizing assessments assume that market demand will not weaken.

 

Implementation of the downsizing will employ criteria which have been discussed with union officials. Affected employees will be offered a severance package, advice on their personal finances and assistance in finding new work.

 

EDB is also amending the strategy for its commitment outside the Nordic region to a partner-based model. Its association with the MaXware and Ster Polska companies in Benelux and Poland respectively will accordingly change during the autumn.

 

The group is making a total provision of NOK 53 million to cover downsizing costs. In addition comes a provision of NOK 12 million for expected losses in projects plus provisions of NOK 27 mill in respect of premises made vacant as a consequence of the downsizing. The overall provision relating to the changes comes to NOK 92 million, which will be expensed in the third quarter of 2003. The full effect of the cost reductions on results is expected to be felt from November 2003.

 

Changes in the Bank & Finance business area also embrace a new product strategy with the emphasis on component-based development, and a new delivery model which is better adapted to customer needs and wishes for modes of collaboration.

 

"A reorganisation of this kind is demanding for everyone involved," observes Mr Urdahl. "The group has accordingly devoted the summer months to extensive planning work. We have sought to balance the need for rapid change with the desire to provide proper follow-up of the employees affected. At the same time, we must ensure that deliveries are made and that customers continue to get proper follow-up during the process. Our aim is to enter 2004 with a more profitable and market-oriented organisation."

 

 

Ole Urdahl, Executive Vice President, Bank & Finance, tel:

+47 90 53 61 16

 

Reidar Gjærum, Executive Vice President, Corporate Communications,

tel: +47 90 85 51 01