Deutsche Bank embarks on global job cuts

Deutsche Bank began laying off staff across the world on Monday, less than 24 hours after it announced 18,000 job cuts to its 92,000-strong workforce across the globe.

Skyline with the 155 meter high twin towers Deutsche Bank I and II in Frankfurt.

Skyline with the 155 meter high twin towers Deutsche Bank I and II in Frankfurt, Germany.

Christian Sewing, chief executive of the troubled German bank, declined to give regional breakdowns of the job cuts, but confirmed that the process of informing those affected had already begun.With the bank now opting out of the equities business as part of its restructuring plans, staff in Australia, Hong Kong and Tokyo all reported being told on Monday morning that they were losing their jobs.Others got the bad news when offices opened in Europe, including in Britain and in Germany. Others were expected to follow later in the day in North America, where the bank employs 9,300 people, the bulk in New York.

London HQ not affected

However, Deutsche Bank said its plans for a new London headquarters, where it currently employs almost 8,000 staff, would not be affected by the restructuring plan. The new HQ is being constructed in Moorgate and comprises 564,000 square feet of space, including retail and commercial office space.The bank said in a statement, "We will retain a significant presence here (in London) and remain a close partner to our UK clients and to international institutions that want to access the London market."Mr Sewing described the job losses as, "painful but unavoidable to ensure Deutsche Bank's long-term success".

Bank has been in the red four out of the last five years

The bank is expecting a  €2.8 billion net loss in the second quarter as a result of restructuring charges and because of losses for the full year. It means Deutsche will have been in the red for four out of the five last years. In April, Deutsche Bank and Commerzbank abandoned merger talks, with both banks saying any deal would have been too risky and would not have generated "sufficient benefits" to offset the costs."The job cuts are part of a radical restructuring of ailing Deutsche Bank, which has suffered from weak profitability and a string of fines for misconduct," reported the Guardian.

Job losses part of restructuring programme to ‘kickstart’ company

"Under the plan, it will cut back its investment banking operations, ending its equities trading business and shrinking its bond and rates trading operations. This will help reduce its headcount to around 74,000."It is also spinning off around €74 billion of under-performing loans into a new bad bank, as CEO Christian Sewing tries desperately to kickstart the company."Germany's international broadcaster, Deutsche Welle, commented, "Sewing has given his team three years. From 2022 on, Deutsche Bank will have had its glamour restored, according to this concept. Excessive costs will have to be drastically reduced, the IT infrastructure will have to be modernized, and the bank will have a much reduced workforce — at least that's the plan."Becoming competitive again is not going to be easy as Germany's savings banks are increasingly boasting successful business operations. Should the European Central Bank continue its zero interest rate policy, Deutsche Bank will find it hard to increase profits."Germany's largest lender is making a radical cut — and it's one that has been overdue. The question is whether the management can motivate employees to carry out the necessary reforms. After all, workers have suffered in recent years as several policy changes haven't yielded their desired effects."Subscribe to Relocate Extra, our monthly newsletter, to get all the latest international assignments and global mobility news.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Global Mobility Toolkit download factsheets resource centreAccess hundreds of global services and suppliers in our Online DirectoryClick to get to the Relocate Global Online Directory