Deutsche Bank cuts 18000 jobs cuts business: Deutsche Bank has decided a major restructuring that will cost him 7.4 billion euros. The first German bank hopes to finally recover the head after years of difficulties. In this context, 18,000 jobs will be eliminated, representing the largest social plan in its history. The first German bank announced Sunday, July 7, 2019 that it would give up its activity on the equity markets and reduce its operations in investment banking to focus on what it considers to be its strengths, such as the financing of its professional clientele, the foreign exchange market or private banking.

It expects a net loss of 2.8 billion euros in the second quarter of 2019 due to restructuring charges related to this plan. Christian Sewing, the chairman of the board of directors, later told Hessische Rundfunk that the bank would be in a loss for the whole year. Deutsche Bank will also reduce its activities in the bond market, particularly in fixed income activities, which are traditionally perceived as one of its strengths. It will create a defeasance structure for the 74 billion euros of risk-weighted assets that it wishes to separate as part of this reorganization.

Deutsche Bank cuts 18000 jobs cuts business

Deutsche Bank's "most fundamental transformation" for decades

A major restructuring was expected since Christian Sewing promised shareholders in May of "drastic cuts" in the investment bank, an activity that has long been a strategic priority for Deutsche Bank but has become a burden for investors. following the financial crisis of 2007-2009. The group's supervisory board met on Sunday to endorse the plan, which was decided after the failure in the spring of a merger plan with Commerzbank, Germany's second largest bank.

Christian Sewing has called it "the most fundamental transformation" of Deutsche Bank for decades. "It's a new beginning," he said. By reducing its activities in the investment bank, the institution takes note of its failure to compete with major Wall Street banks in this field, having suffered three losses annually over the past four years. The implementation of this plan will not require a capital increase, said Deutsche Bank, whose action fell to a record low in early June.

Downsizing across the globe

With the job cuts planned, the largest in the banking sector since the announcement of 30,000 jobs eliminated by HSBC in 2011, Deutsche Bank plans to reduce its workforce to 74,000 by 2022. It did not specify where it was going to eliminate jobs, but its activities on the stock markets are essentially carried out in New York and London. A person with first-hand knowledge of the case has said that these downsizing would be spread around the world and that Germany would not be spared.

Deutsche Bank wants to achieve savings of 17 billion euros by 2022, when it wants to have reduced its cost / income ratio to 70%. Deutsche Bank has entered into a preliminary agreement with BNP Paribas to provide continuity of service to its customers in the equity markets. Stephan Szukalski, a DBV union representative and a member of the bank's supervisory board, told Reuters the plan was going in the right direction. "This could be a real new start for Deutsche Bank," he said.