Deutsche Bank may slash as many as 20,000 jobs in biggest revamp in years

Planned restructuring could reduce the total headcount by more than a fifth

The Deutsche Bank headquarters in Frankfurt. The bank may cut as many as 20,000 jobs in a revamp. Reuters 

Germany's biggest lender Deutsche Bank is considering slashing headcount by more than a fifth in what’s shaping up to be its biggest makeover in years, two people familiar with the matter said.

The lender under chief executive Christian Sewing may decide to cut as many as 20,000 jobs when he presents his latest restructuring plan, perhaps as early as this week. The decision hasn’t been formally adopted yet and the number may yet change.

“Deutsche Bank is working on measures to accelerate its transformation so as to improve its sustainable profitability,” a spokeswoman said. “We will update all stakeholders if and when required.”

Mr Sewing announced at the lender’s annual general meeting in May that he’s working on “tough” cutbacks after he decided to walk away from merger talks with domestic rival Commerzbank in April. His previous turnaround plan, unveiled shortly after he took over as chief executive a little over a year ago, has failed to restore the bank to a healthy level of profitability.

Deutsche Bank had 91,500 staff at the end of the first quarter, down from 95,400 when Mr Sewing took over.

The bank expects to make a formal announcement no later than July 8. The Wall Street Journal first reported on the plan to cut as many as 20,000 jobs.

The sweeping restructuring is likely to hit Deutsche Bank’s investment banking division the hardest, particularly its US operations as well as trading equities and interest rate derivatives. The bank is planning to cut its global equities headcount by 50 per cent.

Reuters reported on Sunday that the lender is looking to hire 300 people globally for its wealth management arm by 2021. It plans to hire those managers across Europe, America and emerging markets, according to the report, which cited Fabrizio Campelli, global head of wealth management.

Deutsche Bank will also make changes to the management board, with investment banking head Garth Ritchie, chief regulatory officer Sylvie Matherat and chief financial officer James von Moltke all potentially leaving. Mr Sewing is likely to take over formal oversight of the investment bank at the management board level.

Deutsche Bank is also planning to set up a unit for assets such as long-dated interest rate derivatives it wants to wind down or sell in an effort to cut unprofitable business and free up capital for other business lines, people familiar have said. The unit could hold as much as €50 billion (Dh208bn) in risk-weighted assets.