Deutsche Bank AG uncovered a radical overhaul that will see the banker exit its equities business, post a 2.8 billion-euro ($3.1 billion) second-quarter loss and cut the workforce by a fifth to reverse a slide in profitability.
Chief Executive Officer Christian Sewing will shelve the dividend this year and next and take restructuring charges of 7.4 billion euros through 2022 to pay for an overhaul that shrinks the German lender’s once-mighty investment bank along with its global footprint and key fixed-income business.
On Sunday Sewing in a statement said, “today we have announced the most fundamental transformation of Deutsche Bank in decades. We are tackling what is necessary to unleash our true potential.”
Key points of the plan and the bank’s financial estimates are targets headcount of 74,000 by 2022, restructuring cost of 3 billion euros in 2Q, 5.1 billion over 2019, cutting risk-weighted assets by about 40% in affected businesses, no dividend to be paid for 2019, 2020, plans to invest 4 billion euros in improving controls by 2022, creates fourth division to be known as corporate bank, sees private bank ROTE above 12% in 2022.
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