Germany's second-largest lender Commerzbank on Wednesday announced a net loss of "almost 2.9 billion euros" ($3.5 billion) for 2020, its first full-year loss since the 2009 financial crisis.
In an ad hoc statement releasing preliminary results, Commerzbank blamed the hit on "the burdens of the coronavirus pandemic" and restructuring charges linked to job cuts and branch closures.
The Frankfurt-based bank also said it had reached an agreement with labour representatives on plans to slash 10,000 jobs and close hundreds of branches by 2024 as the lender pivots to online banking and cashless payment options.
"The planned reductions are certainly very painful," said CEO Manfred Knof, a former Deutsche Bank executive who took the helm at Commerzbank last month.
"The agreement signed with the employee representatives today will contribute to creating clarity for our workforce soon."
Commerzbank said the plan was approved in a supervisory board meeting earlier on Wednesday.
The cuts will affect one in three jobs in Germany.
According to the preliminary results, Commerzbank booked an operating loss of 233 million euros in 2020, compared with pre-tax profits of 1.2 billion euros a year earlier.
The 2.9 billion euro net loss compared with a 585-million-euro net gain in 2019.
Commerzbank has said that its ambitious restructuring strategy will lower costs by 1.4 billion euros, or around 20 percent, by 2024 compared with 2020.
The plan includes shutting 340 of its 790 branches in Germany.
Like its crosstown rival Deutsche Bank, Commerzbank had already announced thousands of job cuts as it struggles to adapt to a reduced need for bricks-and-mortar branches.
A bid for the two German giants to merge fell apart in 2019, prompting Commerzbank to press ahead with a radical revamp and digitalisation drive.
In December, the bank said it was booking 610 million euros in additional provisions to finance the job cuts.
It was also forced to raise its provisions for bad loans last year, as pandemic-induced shutdowns leave many businesses struggling for survival, fuelling fears of a rash of insolvencies.
Like other banks, Commerzbank's earnings have also been pummelled by years of ultra-low interest rates.
The German government still holds a nearly 16-percent stake in the bank which it bailed out during the 2008-2009 financial crisis.
Commerzbank will release its full 2020 earnings on February 11.