Deutsche Bank has announced it will cut almost 3,800 jobs. That's in addition to the 9,200 layoffs already announced, meaning one in seven current Deutsche Bank employees will be looking for work.
Deutsche Bank wants to slim down and push its profits up.
At the end of 2001, some 95,000 people were employed by Deutsche Bank, by the end of next year, that number will be significantly lower. Germany’s largest bank announced on Thursday evening that it will continue paring its workforce as part of an aggressive cost-control program spearheaded by new chairman Josef Ackermann, who officially took over the reigns in late May. He wants Deutsche Bank to save 2 billion euro ($1.9 billion) by the end of 2003.
The Corporate and Investment Banking division will be hit hardest, where approximately 1,970 employees will lose their jobs, more than half from the Americas, 315 in the UK, 310 in the Asia/Pacific region and 320 in Continental Europe.
The other 1,800 layoffs, in the Private Client and Asset Management divisions, will be lost in Germany and other parts of Europe.
"In the face of continued bad performance of the markets," a bank spokesman told reporters, if the bank wants to meet its savings targets "there is no other choice."
Leaner and Meaner
Josef Ackermann took over the top spot at Deutsche Bank with specific goals in mind: lower costs, higher efficiency and with it, higher shareholder value. He wants to create a leaner, meaner bank, one where the emphasis is on performance and share values, even it that means sacrificing some in the client area.
Ackermann finds it unacceptable that when it comes to market capitalization, Deutsche Bank is only in 21st place world wide. He says the bank should be in the top five globally and he appears not afraid to make sacrifices to get it there.
One goal is to drive the bank's market value higher, to ensure it "can play a role in European or global consolidation that will take place in the foreseeable future," Ackermann said.
The bank’s share prices have rebounded from their lows from last September, when they were trading at just over 43 euro ($42.91). For the last few months, a share has traded for around 70 euro ($69.85), still well under its peak of more than 100 euro ($99.79).
In his continuing efforts to slim down, Ackermann is also pressing ahead with plans to sell its considerable shareholdings in some of Germany's corporate giants, including DaimlerChrysler, Continental and Axel Springer.