Deutsche Bank will cut jobs worldwide by up to 7,000 in its first big move under new CEO Christian Sewing to lower costs and return to profitability following years of false beginnings.
The new CEO at the largest bank in Germany said that the bank would lower its global workforce to far below 90,000 from its current count of 97,000 in trading and equities sales staff that is being cut by 25%. The majority of those positions are in London and New York.
After last month’s abrupt reshuffling of management, the bank said it was looking to cut back global investment banking while refocusing on Europe and Germany after three straight years of posting losses. It said cuts in the U.S. would take place in equities, trading and its business serving hedge funds.
CEO Sewing said the bank was committed to its Corporate and Investment Bank and international presence. He added that the bank was the alternative in Europe in the international capital and financing markets and it must focus on what it does well.
The job reductions will lower the leverage exposure at the investment bank by more than €100 billion or $117 billion equal to 10%, with the majority of the cuts taking place in 2018, said the bank.
It did not give any specific numbers for total cuts in jobs, but one source close to the situation did say that the bank was looking at eliminating as many as 10,000 jobs.
In 2018, said the bank restructuring costs totaling €800 million would be incurred. That figure was released by the bank in April. The details of the strategy the bank has come prior to its general meetings with shareholders Thursday.
Shareholders have become upset with a share price that has languished and the banks dropping revenues. They said they would be calling on the executives at the bank to speed the process of its recovery.
Paul Achleitner the Chairman of the bank replaced John Cryan as CEO in April amidst complaints by investors of the bank falling behind in the execution of its turnaround plan.
Shares of the bank, down over 31% in 2018, opened on Thursday morning 0.4% higher.
Deutsche Bank has also come under have pressure from the different agencies that do credit ratings. As Standard & Poor’s is reportedly going to announce before the end of May if it will cut the rating of the bank.