Deutsche Bank to slash investment banking
05 November 2015 Frankfurt
Image: Shutterstock
Deutsche Bank will halve its investment banking business as part of its radical cost-cutting .
The banks plans to 鈥渟electively reinvest鈥� in 鈥渓ess balance sheet intensive businesses鈥�, including prime brokerage, credit solutions and client lending.
The bank also outlined plans to 鈥渕aterially wind-down鈥� its non-core operations unit by the end of 2016.
The strategy鈥檚 core goals surround cost cutting though balance sheet and financial services reductions and regulatory compliance through investment in its IT systems and 鈥減rioritising investment鈥� in its know-your-client and anti-money laundering infrastructure.
The bank鈥檚 global network will also be significantly reduced as it plans to fully exit from 10 countries, mostly in the Latin America and Nordic regions.
Those countries are: Argentina, Chile, Mexico, Peru, Uruguay, Denmark, Finland, Norway, Malta, and New Zealand.
Trading activities in Brazil will also relocate to global and regional hubs, which in turn are to be further centralised.
Approximately 9,000 jobs are on the line but Deutsche declined to comment on which departments or offices are most at risk.
John Cryan, co-CEO of the bank, said: 鈥淚n April, we announced Strategy 2020. Since joining the management board in July, I have been working together with my colleagues to draw up plans to stabilise the bank and to turn around its long-term performance. Now, it鈥檚 all about executing on our plans to build a better Deutsche Bank.鈥�
鈥淲e have four strategic goals. First, to become simpler and more efficient by focusing on the markets, products, and clients where we are positioned to succeed, leading to greater client satisfaction and lower costs.鈥�
鈥淪econd, to become less risky by modernising our outdated and fragmented technology and withdrawing from higher-risk relationships and locations.鈥�
鈥淭hird, to become better capitalised, so that we are no longer playing catch-up with regulation and market expectations.鈥�
鈥淔inally, to run Deutsche Bank with greater discipline and purpose based on delegation of responsibility, personal accountability, and a reward system which is aligned to good performance and conduct.鈥�
鈥淪adly, this also means closing some of our branches and country locations, and reducing some of our front-office and infrastructure staff too. This is never an easy task, and we will not do so lightly.鈥�
鈥淚 promise that we will take great care in this process, moving forward together with our workers鈥� representatives.鈥�
The banks plans to 鈥渟electively reinvest鈥� in 鈥渓ess balance sheet intensive businesses鈥�, including prime brokerage, credit solutions and client lending.
The bank also outlined plans to 鈥渕aterially wind-down鈥� its non-core operations unit by the end of 2016.
The strategy鈥檚 core goals surround cost cutting though balance sheet and financial services reductions and regulatory compliance through investment in its IT systems and 鈥減rioritising investment鈥� in its know-your-client and anti-money laundering infrastructure.
The bank鈥檚 global network will also be significantly reduced as it plans to fully exit from 10 countries, mostly in the Latin America and Nordic regions.
Those countries are: Argentina, Chile, Mexico, Peru, Uruguay, Denmark, Finland, Norway, Malta, and New Zealand.
Trading activities in Brazil will also relocate to global and regional hubs, which in turn are to be further centralised.
Approximately 9,000 jobs are on the line but Deutsche declined to comment on which departments or offices are most at risk.
John Cryan, co-CEO of the bank, said: 鈥淚n April, we announced Strategy 2020. Since joining the management board in July, I have been working together with my colleagues to draw up plans to stabilise the bank and to turn around its long-term performance. Now, it鈥檚 all about executing on our plans to build a better Deutsche Bank.鈥�
鈥淲e have four strategic goals. First, to become simpler and more efficient by focusing on the markets, products, and clients where we are positioned to succeed, leading to greater client satisfaction and lower costs.鈥�
鈥淪econd, to become less risky by modernising our outdated and fragmented technology and withdrawing from higher-risk relationships and locations.鈥�
鈥淭hird, to become better capitalised, so that we are no longer playing catch-up with regulation and market expectations.鈥�
鈥淔inally, to run Deutsche Bank with greater discipline and purpose based on delegation of responsibility, personal accountability, and a reward system which is aligned to good performance and conduct.鈥�
鈥淪adly, this also means closing some of our branches and country locations, and reducing some of our front-office and infrastructure staff too. This is never an easy task, and we will not do so lightly.鈥�
鈥淚 promise that we will take great care in this process, moving forward together with our workers鈥� representatives.鈥�
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