(Bloomberg) -- Banco Santander SA overhauled its corporate structure as Chief Executive Officer Hector Grisi seeks to simplify the company’s operations.

As part of the changes, the Spanish bank is combining individual countries’ retail and commercial banking businesses under a new global unit, which will be headed by Daniel Barriuso, and creating a new digital consumer bank area that will be led by Jose Luis de Mora, Santander said in a statement late Monday, confirming an earlier Bloomberg report. 

The moves are aimed at simplifying the business and helping the company reach profitability targets. They will likely reduce management layers and may lead to some job cuts, people familiar with the matter said, asking not to be identified discussing non-public information.

The new management structure will result in five units: retail and commercial, digital consumer bank, payments, wealth management and insurance as well as corporate and investment banking.

Santander’s revamp closely resembles a plan announced last week by Citigroup Inc. CEO Jane Fraser. In that company’s biggest restructuring in two decades, Fraser reorganized the firm into five main business and eliminated regional chiefs who oversee operations in about 160 countries. The changes will involve a number of job cuts in Citigroup’s back-office functions.

The Spanish bank last year named Grisi, who had been running the Mexico business, as the company’s chief executive officer, a role he took on at the start of 2023. A string of hires and management changes followed, including the exit of Antonio Simoes, who had been head of Europe and was seen as a possible CEO candidate. The bank in April hired Christiana Riley, a longtime Deutsche Bank AG executive, as head of its North American and Mexican operations, starting Oct. 1. 

In a strategy plan in February, Santander set a target for a return on tangible equity of as much as 17% in 2025, up from 14.4% in 2022. That compares with more than 10% at Deutsche Bank AG and 12% at BNP Paribas SA, who are both aiming to reach those levels in the same year. Earlier this week, Societe Generale SA lowered it’s target for return on tangible equity to between 9% and 10% for 2026.

Santander shares, which were little changed on Tuesday, have gained about 23% this year, more than the Stoxx 600 index of European banks. 

An expansion into US investment banking is also in the works, tapping several new hires from the ranks of Credit Suisse.

Read More: Santander Hires on Wall Street for Investment Bank Expansion

Santander will align the way it reports financial results to the new model starting in January 2024, with the five global businesses becoming the new primary segments for the group, while country and region-specific data will become secondary segments, it said.

The lender adopted a regional approach to managing its business in 2019, and a year later rolled out a ‘One Santander’ strategy, to which chairman Ana Botin often refers. That strategy was aimed at increasing connectivity, the company says on its website.

With businesses from Spain to the UK, Brazil and the US, Banco Santander is one of the largest retail banks in the world. It has about 212,000 employees and a market capitalization of 55.7 billion euros ($59.5 billion). Botin has been executive chairman of the lender since her father died in 2014.

(Updates with ROTE targets of peers in seventh paragraph)

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