German insurer Allianz, the biggest in Europe, declared on Thursday it was to axe 7,500 jobs as part of a sweeping restructuring initiative.

Allianz said in a statement in Munich that it would slash 5,000 jobs at its German insurance division. A further 2,480 jobs would be cut within its banking arm, Dresdner Bank.

The number of company locations worldwide will also be cut -- from 21 to 10, the statement added.

The restructuring measures are expected to save up to 500 million euros (630 million U.S. dollars), it said.

"These are painful but necessary steps to ensure a sustainable increase in Allianz's competitiveness," said Gerhard Rupprecht, head of Allianz Deutschland.

The restructuring, which began last year, is intended to reverse Allianz's falling share in the market and respond to growing pressure on costs in the insurance sector, he said.

The announcement did not sit well with labor union ver.di, which said it would launch warning strikes next week.

Ver.di, which counts some 2.4 million members who work in financial services, insurance, health care, the media and the federal government, said if the company failed to negotiate seriously on job security, "strike (action) can't be ruled out."

Source: Xinhua