SYDNEY / HONG KONG (Reuters) – Deutsche Bank (DBKGn.DE), the German lender eliminated entire teams in its Asian operations and started cutting 18,000 jobs worldwide, in one of the biggest reshuffles of an investment bank since the financial crisis.
FILE PHOTO: A Deutsche Bank logo adorns a wall at the company's headquarters in Frankfurt, Germany, June 9, 2015. REUTERS / Ralph Orlowski / File Photo
The lender announced Sunday job losses as part of a restructuring plan that will ultimately cost 7.4 billion euros ($ 8.3 billion) and cancels years of work. aiming to make its investment bank a major player on Wall Street.
As part of this overhaul, the bank will discontinue its global equity-related activities and will reduce certain operations of its fixed-income securities – an area traditionally considered one of its strengths.
Deutsche Bank shares are expected to increase by 5.2% to 0548 GMT, according to broker Lang & Schwarz's pre-market data.
Deutsche Bank has not provided a geographical breakdown for job cuts, although the package is expected to fall in Europe and the United States. Monday's World Day started with cuts in Sydney, Hong Kong and elsewhere in the Asia-Pacific.
Bankers leaving Deutsche Bank offices in Sydney on Monday said they were laid off but not identified because they had to return later to sign layoff plans.
A person familiar with the bank's operations in Australia said his team of four equity market specialists was also dissolved. The person also stated that most members of his mergers and acquisitions (M & A) team were not immediately affected.
Entire sales and trade teams are also losing their jobs, according to several German bankers.
Regionally, Deutsche regularly ranked among the top 10 banks in the ECM trading rankings, but it has fallen in recent years, reaching the 17th year last year and the 18th in 2019, according to Refinitiv data. So far this year, it ranks 8th in the region for mergers and acquisitions.
Deutsche employed approximately 4,700 people in its main regional offices in Sydney, Tokyo, Hong Kong and Singapore, and posted fact sheets on its website.
Before the cuts, his investment banking team for the Asia-Pacific region had about 300 people, 10% to 15% of whom will be laid off, almost all in its equity markets division, according to a leading Asian banker who knew the country directly. sector. plans.
A Hong Kong-based stock trader who had been fired said that the mood was "rather gloomy" as people were summoned individually to meetings.
"(There are several rounds of discussions with human resources, then they give you this package and you leave the building," said the trader.
Several workers were seen leaving offices with large envelopes bearing the logo of the bank. Three employees photographed themselves next to a large Deutsche Bank logo and hugged each other before hailing a taxi.
"If you have a job for me, let me know. But do not ask questions, "said one person who confirmed his job at Deutsche Bank, but declined to comment further.
A spokeswoman for Deutsche Bank declined to comment on some departures, saying the bank would communicate directly with employees.
"We understand that these changes are profoundly affecting people's lives and we will do everything in our power to be as responsible and sensitive as possible in implementing these changes," she said.
President and CEO Christian Sewing, who now wants to focus on the bank's more stable revenue streams, said Sunday that it was the most fundamental transformation of the bank in decades. . "It's a restart," he said.
"We are creating a bank that will be more profitable, lighter, more innovative and more resilient," he wrote to employees.
The bank will set up a "bad bank" to reduce unwanted assets, worth 74 billion euros of risk-weighted assets.
Sewing will now represent the investment bank on the board in a shift illustrating the decreasing influence of the division.
The CEO announced a major restructuring in May when he promised his shareholders "severe cuts" to the investment bank. This decision followed Deutsche's inability to accept a merger with rival Commerzbank AG (CBKG.DE).
On Monday, Werner Steinmueller, the bank's chief executive for the Asia-Pacific region, told staff, in a memo consulted by Reuters, that the bank was focusing on its key strengths.
"The new investment bank will be smaller but more resilient and will focus on our financing, capital markets, advisory, sales and trading activities," he said.
A senior banker at Deutsche Deutsche Bank, who still had his job, pointed out that the bank was not abandoning the contracts he was currently working on, but he wondered how far his lightening franchise was. could be competitive in the future.
"Our content management business needs to be scaled down, but it's not like it's going to happen in the same day," he said. "The biggest question for us is where we are going if we do not offer the full range of products. Will customers stay with us or is the game over? "
Report from Paulina Duran to SYDNEY, Takashi Umekawa to TOKYO, Sumeet Chatterjee and Alun John to HONG KONG, Anshuman Daga to SINGAPORE, Tom Sims and Hans Seidenstuecker to FRANKFURT and Michelle Martin to BERLIN; Written by Jennifer Hughes; Edited by Christopher Cushing and Stephen Coates