MADRID (Reuters) - Spain's largest bank Santander (>> Banco Santander, S.A.) will cut 3,000 jobs following its planned merger with its Banesto (>> Banco Espanol de Credito SA) subsidiary, Cinco Dias reported on Friday, citing sources from unions and close to the bank.

Santander announced plans to fully absorb its 110 year-old Banesto brand last month, closing 700 branches to cut longer-term costs.

The bank had warned of gradual but heavy job losses when it announced the deal but did not give a specific number. Official talks with unions over the cuts will open on January 9, Cinco Dias said.

No one at Santander was immediately available for comment.

Nationalised Spanish lender Bankia (>> Bankia SA) will also begin talks with unions on January 9 over previously announced plans to lay-off 6,000 of its 20,000-strong staff, Europa Press reported.

Spanish unemployment, already at a record high of 25 percent, is expected to keep growing in 2013 as other nationalised banks and struggling companies continue to cut staff in a weak economy.

Spanish airline Iberia, owned by the International Airline Group (>> International Consolidated Airlines Grp) is negotiating 4,500 job cuts - a quarter of its workforce - with unions as part of a wider restructuring it says is necessary for its very survival.

(Reporting By Tracy Rucinski; Editing by Hans-Juergen Peters)