Whole teams at Deutsche Bank were told on Monday their positions had been axed as it began 18,000 job cuts globally in one of the biggest overhauls to an investment bank since the aftermath of the financial crisis.
The German bank began telling staff of the layoffs in Sydney, then across the world, taking in its Hong Kong and Singapore trading hubs before bankers in Europe and the US reached their offices to be told their fates.
Staff were seen leaving the building in the City of London with thick white envelopes detailing their layoff packages. Earlier, they queued up inside the office to meet with human resources, according to Deutsche Bank employees who spoke to Bloomberg, asking not to be identified.
Inside the office, chief executive Christian Sewing was in attendance as the cuts got underway. A black Mercedes could be seen leaving the building following a lengthy conference call he led on the extent of the bank’s overhaul.
London houses around 7,000 of Deutsche Bank’s UK employees and is the hub for the German’s lender’s investment bank, which is bearing the brunt of the cuts. Earlier in the day, equities teams from Australia to India were among those losing their jobs as part of Mr Sewing’s plan to cut positions to reverse a slide in profitability.
The bank unveiled its radical overhaul that will see the lender exit its equities business, post a €2.8 billion (Dh11.54bn) second-quarter loss and cut the workforce by a fifth to reverse a slide in profitability.
Mr Sewing will shelve the dividend this year and next and take restructuring charges of €7.4bn through 2022 to pay for an overhaul that shrinks the lender’s once-mighty investment bank along with its global footprint and key fixed-income business.
Deutsche Bank shares were down 5.5 per cent at around 3pm in Frankfurt trading after climbing as much as 4.4 per cent earlier.
The cuts come at a difficult time for the banking sector in the UK. In its summer 2019 analysis of London’s financial district, recruitment specialists Morgan McKinley said there was a 50 per cent fall in jobs available year-on-year as the finance sector remained stagnant with no progress in Brexit negotiations.
“Major banking organisations as well as those from the wider financial services space, have refrained from investing in talent due to the lack of clarity,” said Hakan Enver, managing director of Morgan McKinley UK.
Earlier on Monday, staff in other countries learned of their fates. "We are still what we were on Friday but with a much, much smaller equities capability," said one senior Sydney-based bank executive, who kept his job.
Many others were not so lucky. "The day started with a phone call and a meeting with HR. We were informed that our jobs have become redundant and handed over our letters and given approximately a month's salary and have been asked to leave. Our systems have been taken and we can't log in and have been asked to vacate the premises by 07.30 GMT," said a Bengaluru-based banker.
A senior Hong Kong-based equity capital markets (ECM) banker said he was surprised by the scale of cuts to the bank's ECM business in Asia. "With these kind of cuts in the equities business, you can't avoid an impact on the investment bank. All the clients here were already asking questions about the changes, and now they will ask questions about the ability to provide truly bespoke service. And it's not like they don't have any options in the market."