Spanish lender Banco Sabadell has reportedly reached an agreement with workers union to reduce the number of redundancies in its home market.

Initially, Banco Sabadell had planned to lay off nearly 1,900 employees as part of a drive to reduce costs.

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The bank has reached an agreement with Comisiones Obreras (CCOO) to lower the number of layoffs, which will be capped at 1,380, Reuters reported citing a union spokesperson.

“If 1,380 employees take redundancy leave the bank would accept it,” the report stated citing union spokesperson and added that if more employees decided to leave cuts would be capped at 1,605.

The Spanish lender has confirmed the deal in a statement issued to the country’s National Securities Market Commission (CNMV).

Banco Sabadell said: “Today Banco Sabadell has reached an agreement with all the sections of the unions negotiation committee which represent the employees, in the framework of a redundancy procedure for Banco Sabadell in Spain which will affect a maximum of 1,605 employees.”

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Banco Sabadell, which currently has over 15,000 employees, expects the process to cost it nearly $312.15m before tax.

It would reduce the bank’s Common Equity Tier 1 (CET1) fully loaded solvency ratio by 23 basis points, the lender added.

Banco Sabadell plans to dampen the impact by selling its bond portfolio to raise capital.

Sabadell’s peers in the region have planned similar moves to adapt to the digital banking shift and save costs.

In July this year, Caixabank reached an agreement with the unions to lay off 6,452 employees.