Deutsche Bank Plans To Reduce Global Headcount By 20,000
Zacks Investment Research | Jul 01, 2019 08:18AM ET
Deutsche Bank (DE:DBKGn) (NYSE:DB) is planning to cut about 15,000-20,000 jobs as part of its major overhaul, with majority of cuts in the equities trading business. The news was first reported by The Wall Street Journal.
The planned cuts are equivalent to about one-sixth of current full-time positions at Deutsche Bank. Also, the Journal reported that the reductions will be made over a period of one year across different regions and businesses.
At its annual meeting held in May 2019, CEO Christian Sewing had promised shareholders that the bank is prepared to make “tough cutbacks” at its investment bank. The German lender faces pressure to trim its investment banking division following the collapse of merger talks with the domestic rival Commerzbank (DE:CBKG).
The announcement is expected to be made soon after the supervisory board meeting on Jul 7.
Also, changes in the board are expected as talks of investment banking head Garth Ritchie, Chief Regulatory Officer Sylvie Matherat and Chief Financial Officer James von Moltke leaving the company have been making rounds, per a Bloomberg’s article.
Though Sewing has not been successful in turning around the bank so far, he continues to undertake several restructuring moves. With an aim to increase exposure to businesses with stable revenues, Deutsche Bank plans to hire about 300 relationship and investment managers in its wealth management division by 2021 across Europe, America and emerging markets.
Further, it seeks to dedicate a new unit for assets like long-dated interest rate derivatives, which it wants to wind down or sell with a view to cut unprofitable business and free up capital for other productive business lines.
Notably, Deutsche Bank’s U.S. unit received a clear signal from the Federal Reserve for its capital distribution plans, which is likely to raise investors’ optimism over the stock. However, dismal revenue performance and involvement in litigation issues remain key concerns.
Shares of Deutsche Bank have lost 6.9% on the NYSE in the past six months against the Zacks Investment Research
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