Deutsche Bank to axe investment bankers in up to US$5.6 billion revamp

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Deutsche Bank expects the cost of a major overhaul in the works to be up to 5 billion euros (US$3.4-US$5.6 billion), one person familiar with the ...

FRANKFURT: Deutsche Bank is preparing to unveil a sweeping, multi-billion euro overhaul within days that would see the axe fall heaviest on investment bankers, sources familiar with the matter said on Wednesday.AdvertisementChief Executive Officer Christian Sewing flagged an extensive restructuring in May when he promised shareholders"tough cutbacks" to the investment bank. The pledge came after Deutsche failed to agree a merger with rival Commerzbank .

The overhaul signals that Deutsche is coming to terms with its failure to keep pace with Wall Street's big hitters such as JP Morgan Chase & Co and Goldman Sachs ."Sewing really wants to move the needle," said another person familiar with the plans. Deutsche declined to comment on the restructuring costs or the effect on its earnings. The bank said it was working on measures to accelerate its transformation so as to improve its sustainable profitability."We will update all stakeholders if and when required," it said. The bank's supervisory board is due to meet on Sunday to discuss the overhaul, people familiar with the matter said.

The investment bank generates about half of Deutsche Bank's revenue but is also considered its Achilles heel.

 

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