Deutsche Bank forced to take unfavorable measures

During the almost three years on office, former boss Cryan cleaned up most of the toxic lagacy of Deutche’s pre-financial crisis bid to compete with global investment banking giants, in part by paying billions in fines and compensation. But he failed to drag the bank back into positive numbers. On top of that President Trump’s corporate tax reform is the mail reason of the bigger than expected net loss of € 735 million in 2017, reported the Deutche Bank. Begin 2018 some investors wanted supervisory board chairman Achleitner to look for a new top manager.

Christian Sewing, CEO at the Deutche Bank, has vowed to refocus Deutsche Bank on retail banking and asset management, seen as more stable sources of income, while slimming down its share trading and other investment banking activities. In corporate banking, the Deutsche Bank plans to reduce its commitment to the U.S. and Asia and focus more on Germany and Europe. Other targets of Deutsche Banks restructuring include fully integrating subsidiary Postbank into its German retail banking operations and further reducing its massive holdings of financial derivatives.
Better controle over processes
The appointment of a new chief operating officer, Frank Kuhnke, as a direct report to Sewing is a signal that the CEO wants to have better control over processes and expenses. Someone said that Kuhnke’s efficient yet blunt tactics have earned him the moniker ‘Frank the Tank.
Control expenses
CEO Sewing, has been warning senior managers at the investment bank that if they can’t show they’re able to control expenses, they will not be trusted to be able to grow revenue. Managers are being given fixed budgets that they must not exceed under any circumstances, said the people, asking not to be identified in discussing internal information.
Lay off at least 7,000 people
While a large part of the bank’s savings will come from a plan to lay off at least 7,000 people, Sewing is scrutinizing non-compensation expenses to change a culture where budget overruns were often seen as trivial, the people said, especially true of the securities unit.
Deutsche Bank will also step up its cost-cutting drive, aiming to reduce adjusted costs to €22 billion in 2019, compared with €23 billion this year.