Deutsche Bank shares are trading lower Thursday as the German-based investment bank announced it was reducing its staff head count by at least 7,000 as it speeds up the pace of restructuring. Some 600 jobs have already been axed with possibly up to 10,000 roles to be gone by the end of 2019.
By 1240 BST, Deutsche Bank shares were 3.41% lower at €10.59. The stock has lost over 30% in the year to-date and further falls are possible if the bank’s plans aren’t considered credible in terms of generating the revenue expected for such a prominent European business.
Deutsche Bank speeds up restructure process
Deutsche Bank has been undergoing a restructure process for some time. However, the bank’s chairman Paul Achleitner replaced CEO John Cryan with Christian Sewing in April, as the board and shareholders were unhappy with pace and results of the turnaround.
Thursday’s announcement comes at the AGM and details where and why the job cuts are happening.
“Deutsche Bank will significantly reshape its Equities Sales & Trading business. Overall, the bank aims to reduce headcount in this area by approximately 25%,” the bank said in a statement. Adding: “The associated personnel reductions are underway.”
“We remain committed to our Corporate & Investment Bank and our international presence – we are unwavering in that,” CEO Sewing said. “We are Europe’s alternative in the international financing and capital markets business. However, we must concentrate on what we truly do well.”
Job cut details
The bank said that it plans to reduce the number of full-time positions at the firm from just over 97,000 to “well below” 90,000. The planned job reductions are calculated to reduce the investment bank’s leverage exposure by 10%, or €100 billion euros.
Despite the job cuts, Sewing said the bank was continuing to aim to deliver steady growth in the coming years and to remain the main European alternative in the global investment banking market.