Thousands of jobs in Deutsche Bank offices across Asia and Europe went last night, with more due to be axed in the US as German’s troubled largest bank starts a last ditch attempt to revitalise itself by shrinking its global and markets footprints.
Media reports in Reuters, Bloomberg and the Financial Times said hundreds of people across the 4,700 staff in four major Asian offices (Sydney, Tokyo, Hong Kong and Singapore) were terminated yesterday.
The bank is sacking a total of 18,000 people as it destroys its equities business and cuts its fixed interest trading business – one of its traditional strengths- to a mere shadow of itself.
The cuts will fall hardest on the investment bank which is being radically downsized – 40% of its trading staff in the investment bank are going, 74 billion euros worth of dud loans are being placed into a bad bank and run down and billions will be spend on redundancy.
Deutsche said it does not plan to raise capital to fund the revamp, which is expected to cost 7.4 billion euros by 2022, and will finance much of that cost by not paying dividends for the next two years.
The Financial Times commented “The new strategy signals a retreat from Deutsche’s ambitions to be a European rival to Goldman Sachs, as chief executive Christian Sewing refocuses on the bank’s foundations in European corporate financing and domestic retail banking.”
The revamp started Sunday and will continue for the next couple of months, but the bulk of the job cuts will happen this week.
“Bankers in Sydney seen leaving the lender’s offices on Monday confirmed they worked for Deutsche Bank and were being laid off, but declined to give their names as they were due to return later to sign redundancy packages,” Reuters reported.
“One person with knowledge of the bank’s operations in Australia said its four-strong equity capital markets team was being let go, but that most of its mergers and acquisitions (M&A) team would not be immediately affected, the Reuters report added.
Deutsche Bank has been operating in Australia since 1973, with offices in Sydney, Melbourne and Perth.
In Australia the bank provides services across corporate finance, equities, fixed income, currencies and global transaction banking.