July 30, 2015
In October wants the head of Deutsche Bank, John Cryan, submit details of the new strategy. Until then, there’s a lot to think about. Photo: RTR
The new co-head of Deutsche Bank, John Cryan, starts with good quarterly figures. Income lay vigorously. However, the interim report also highlights the major problems of the institute and the new boss his staff on a radical restructuring before.
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The numbers are good, but the new boss is not happy. John Cryan, since July 1, co-head of Deutsche Bank, took the tripled net profit on Thursday not for praise, but chose harsh words: Earnings lie “because not nearly where we should be,” the costs are “simply unacceptable “he wrote in an email to the 98 000 employees and rebuked the” wasteful use of our hard-earned income “. This means:. On the German bank employee hard times come to
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At first glance, the bank put a track record before: In the second quarter pre-tax profit rose to 818 million euros after 238 million a year earlier. Pre-tax profit rose by a third to 1.2 billion euros, the consolidated revenues increased thanks to growth in all business areas by 17 percent to 9.2 billion to.
But all that is not enough for the 54-year British Cryan. Already on his first day he had sent a clear message to employees: The Bank need a Schrumpfkur, the costs are to be reduced. Significant cuts had Cryan announced in investment banking – in the area so that its predecessor Anshu Jain had passed until 2012. This business is less profitable because of the prescribed capital buffers. “This luxury we can no longer afford”, was the new boss, who had been the Swiss UBS rebuilt between 2008 and 2011. As CFO
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investors react positively
Cryans goal is a fundamental “change of culture” in Germany’s biggest money home. The bank is too inefficient work processes too cumbersome, the business model too complex, and all this leads to a “rate of return that is much too low for our investors,” he complained. While the return on equity after tax was 5.7 percent in the second quarter significantly higher than a year earlier, when they had reached only 2.1 percent. But foreign competition is much more profitable than the Frankfurter.
While the German banking accounted for rising yields. So she took a April-June 2015, bond trading 16 percent higher, while equity trading, the increase was even 39 percent. However, the costs increase with, among others, because of the many lawsuits that cost the institution in the second quarter EUR 1.2 billion. This involves, among other things to manipulation of interest rates and foreign exchange to the suspicion of money laundering and to dubious dealings with mortgage. Currently, the bank for legal legacy has traveled 3.8 billion euros. Other potential legal risks they put at 3.2 billion euros. “Our reputation has been damaged, the severe penalties thin our capital reserves, and it will continue to do,” said Cryan.
Now he wants to turn things around. He has inherited from his predecessors preparatory work for a “Strategy 2020″, which should reduce the cost by 15 percent and investment banking by 17 percent. Details are expected to be presented in October. But it is already clear: Thousands of jobs will be eliminated. “Changes can be stressful,” Cryan said on Thursday, “but maintain the status quo is not an option.” In addition to the job cuts, the bank plans to withdraw from different countries. In addition, the Postbank are sold and the retail business will be cut back.
The restructuring of the Group is indeed also swallow a lot of money. Investors reacted positively on Thursday but on the clear words of the bankers: The German bank shares rose until late afternoon by more than three percent to
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