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Around 20,000 employees of E.U. banks are getting the axe in a sweeping new bid to cut costs. But as low interest rates, increasing regulation and new industry competition builds, there looks to be no real end to roll backs in sight.

15:01:28 There have been better times to work for a bank. Once again, Europe’s financial institutions are preparing for big layoffs.

Major Dutch lender ING plans to slash about 7,000 jobs within the next five years. Germany’s second biggest private bank Commerzbank announced it’s losing 9,600 positions by 2020. Even Spain’s Banco Popular has 3,000 more jobs on the chopping block.

Across the board, European banks intend to lay off about 20,000 people, and that probably won’t even be the end of the wave.

Since the financial crisis, more than 150,000 positions have already been eliminated across Europe’s industry, according to analysts at Bloomberg’s financial information service. Even though eight years have passed since U.S. investment bank Lehman Brothers went belly up, the consequences of the financial crisis have yet to be overcome.

Heads of European banks repeatedly complain that low interest rates, expanding regulatory requirements and competition from new industry players are hurting business. And some banks, like Germany’s embattled Deutsche Bank, have also been hit with heavy fines for past transgressions.

No matter how you mix the ingredients, it’s a cocktail that tastes bad for everyone in the industry.

“We simply are not making enough money,” said Commerzbank Chief Executive Officer Martin Zielke at the unveiling of his new strategy, adding that this is a problem for the entire industry, not just Commerzbank. “And unless we do something about it, the situation will only get worse.”

Even though eight years have passed since U.S. investment bank Lehman Brothers went belly up, the consequences of the financial crisis have yet to be overcome.

Mr. Zielke is reacting primarily with massive cuts, planning to eliminate about 9,600 full-time positions at Germany’s second-largest bank. In return, Commerzbank will create 2,300 new jobs in Germany and abroad, but many of the bank’s current employees are unlikely to qualify. Mr. Zielke aims to transform the bank into a technology-driven company. The first step, he said, is refining IT systems so that processes can be automated.

So far the cost-cutting plan has been well received by analysts. But experts also point out that German labor law could prolong negotiations over terminations. Labor representatives have already said they will oppose Mr. Zielke’s plans, especially as the CEO is unwilling to rule out compulsory redundancies. The bank begins talks with labor representatives on Wednesday.

Such terminations face high hurdles, said Gregor Dornbusch, an attorney specializing in labor law at the Baker & McKenzie law firm. “A redundancy program specifies who is to receive what kind of settlement, but it also involves social criteria,” Mr. Dornbusch said. In many cases, he explained, older employees who face greater obstacles in the job market receive the largest settlements. “Those who are relatively new to a company or are on the verge of retirement tend to receive less,” he added.

This explains why layoffs are very expensive for a bank, with industry experts estimating an average cost of €100,000, or $112,000, per employee. But slashing jobs may be inevitable. Deutsche Bank Chief Executive Officer John Cryan plans to cut 9,000 full-time jobs, including 4,000 in Germany, and another 6,000 consultants. The bank is currently looking into whether it can eliminate the positions more quickly than originally planned.

Like Deutsche Bank, Netherlands-based ING also wants to cut costs, but the bank is actually doing extremely well compared to its European competitors. ING reported net earnings of €1.4 billion, or $1.5 billion, in the second quarter. Nevertheless, Chief Executive Officer Ralph Hamers defended the decision.

“These programs and plans need to be approached from a position of strength,” he said in a conference call. ING plans to eliminate up to 7,000 positions, mainly in Belgium and the Netherlands. The cuts will also affect 1,000 employees of affiliated service providers.

The bank intends to save about €900 million, or $1 billion, a year by 2021 with its program. It’s moving to emulate the model of its German direct bank subsidiary ING DiBa, which snapped up market share from established lenders via the Internet, without costly brick-and-mortar branches.

Now Mr. Hamers has set his sights on completely different competitors. “There are very clear indications that tomorrow’s competitors will be companies like Google, Apple and Facebook.”

If that’s true, the downsizing at Europe’s banks has probably only just begun.

Switzerland has stepped up pressure on Malaysia over corruption allegations linked to the 1MDB state investment fund, saying it suspected a Ponzi scheme had been used to conceal “substantial amounts” of misappropriated funds.

The Swiss attorney-general’s office said on Wednesday that its criminal inquiries relating to 1MDB had identified further suspect transactions involving the Swiss financial sector, including $800m misappropriated from investments in natural resources made by a 1MDB subsidiary, SRC.

The Swiss statement said: “It is suspected that a Ponzi scheme fraud was committed to conceal the misappropriations from both the SRC fund and from 1MDB.”

The accusations of a Ponzi scheme — a fraud in which funds generated from subsequent investors, rather than revenue, is used to pay initial investors — will fuel concerns over the governance of 1MDB, which was set up by the Malaysian prime minister Najib Razak.

Both Mr Najib and 1MDB deny any wrongdoing. The Malaysian parliament’s public accounts committee said in April that billions of dollars in transactions by the fund had not been accounted for. By January this year 1MDB’s debts ballooned from 5bn Malaysian ringgit to 50bn ($13bn).

In an apparent rebuke to Malaysian authorities, Swiss officials said that a request for assistance made to Kuala Lumpur in January was “still pending” and added that they had now requested “further mutual legal assistance” from Malaysia over the affair.

The Swiss attorney-general’s office said it “remains confident that the two requests for mutual legal assistance made to the authorities in Malaysia will be executed”.

The latest Swiss intervention shows how pressure from global regulators is intensifying, after US authorities moved to seize $1bn in assets — including properties in New York and Beverly Hills — as part of an investigation into 1MDB.

But domestically, inquiries into the affair have ground to a standstill. Malaysia’s previous attorney-general, Abdul Gani Patail, was suddenly retired on grounds of ill health last year, part of a series of moves which blunted criticism over 1MDB.

Malaysia’s new attorney-general, Mohamed Apandi Ali, has cleared the prime minister of wrongdoing over $681m paid into Mr Najib’s personal bank account, a transfer which Mr Apandi said was made by Saudi royals.