Category Archives: Deutsche Bank

(BBC) Deutsche Bank’s US unit fails Fed’s stress test

(BBC)

This file photo taken on May 2, 2018 shows a view of the Federal Reserve in Washington, DCImage copyrightAFP/GETTY
Image captionThe Federal Reserve administers annual “stress tests” on the largest banks operating in the US

Deutsche Bank’s US division has failed the second round of the Federal Reserve’s annual two-stage stress tests, designed to assess how well the sector could withstand another financial crisis.

The German lender suffered from “widespread and critical deficiencies” in parts of its business, the Fed said.

Goldman Sachs and Morgan Stanley were only granted “conditional” passes.

But 31 of the 35 banks tested were given the all-clear.

Stress tests were introduced in the wake of the 2008 financial crisis and every year America’s central bank, the Federal Reserve, puts the country’s banks, including foreign subsidiaries operating in the country, through their paces.

The Fed measures whether banks are holding sufficient capital to cope with a recession and in the second part of the process it focuses on banks’ “capital plans” such as how much cash they intend to return to shareholders. However this is the first year that the results of the US units of foreign banks have been publicly released.

All of the 35 largest banks subject to the tests passed the first part of the testslast week.

But the Fed found Deutsche Bank’s US arm had “material weaknesses in the firm’s data capabilities and controls supporting its capital planning process, as well as weaknesses in its approaches and assumptions used to forecast revenues and losses under stress”.

The verdict is another blow for the troubled German lender whose financial health has been under the spotlight recently. And it will require the bank to make changes to the way it operates in the US.

Goldman Sachs and Morgan Stanley were given passes, but will not be permitted to increase the amount they return to shareholders beyond levels in line with the last couple of years, in order to bolster their capital cushions.

The Fed said it was also granting a conditional pass to Boston-based State Street, which will be required to take additional steps to manage and analyse its exposure to losses.

Last year was the first time all banks passed the second round of the tests.

The second part of the tests is closely watched because it determines how much firms can return to shareholders in the form of items like share buybacks and dividends.

‘One-off event’

The Fed said it had granted the conditional pass to Goldman and Morgan Stanley because the companies’ results had been skewed by tax changes passed last year.

The tax overhaul lowered the corporate rate from 35% to 21%, but led to larger-than-usual one-off tax bills for many banks, as a result of other changes to how losses and overseas profits are taxed.

“This one-time reduction does not reflect a firm’s performance under stress and firms can expect higher post-tax earnings going forward,” the Fed said.

Despite the restrictions, Goldman will still be permitted to spend up to $6.3bn on share buybacks and dividends this year.

Morgan Stanley said it planned to return $6.8bn to shareholders.

Making progress

The decision is the latest blow for troubled Deutsche Bank. Last month the firm announced more than 7,000 job cuts and its credit rating was cut by Standard & Poor’s. The bank reported an annual loss of €500m (£438m) at the end of February.

Deutsche said its US division had “made significant investments to improve its capital planning capabilities as well as controls and infrastructure.”

“Deutsche Bank USA continues to make progress across a range of programmes and will continue to build on these efforts and to engage constructively with regulators to meet both internal and regulatory expectations,” the bank said.

The bank will be required to improve its operations, risk management and governance as a result of the test-failure. It will not be able to make distributions to its German parent firm without the Fed’s approval.

(ZH) Deutsche Bank Tumbles To New Record Low, Drags European Banks

(ZH) Global systemic fears re-emerged this morning, when in addition to ongoing concerns about trade wars which dragged Chinese stocks deeper into a bear market as the Yuan fell for a 10th consecutive day, now there are European banks to also worry about.

Having been relatively stable for much of the recent slide, on Wednesday morning, Deutsche Bank came under heavy selling pressure, tumbling 5% shortly after the start of trading, and dropping to a new all time low of €8.76, and bringing its market cap to just $21BN. By comparison, JPMorgan’s market cap is $357BN.

The stock has since rebounded modestly, and was down 2.3% last, after breaking below €9 for the first time since 2016, when Germany’s largest bank was seen to be on the verge of collapse…

… however the dead cat bounce appears to be nothing more than a temporary respite: “Falling bellow the €9 level adds more pressure to the stock as that was seen as a technical low bottom,” Ignacio Cantos, investment director at ATL Capital in Madrid, told Bloomberg.

The drop in Deutsche Bank sent the The Stoxx Banks Index down 1.8%, to the lowest level since 2016. European Banks Index is now 14% down YTD, of which Deutsche Bank is the worst performer, down 44% YTD.

And sent the index of the global systemically important banks to a 14-month low.

What caused the slump? As Bloomberg’s Paul Dobson writes, there is plenty to worry about besides the usual worries about trade wars, emerging markets, and Italy, including hedge funds warning of a crisis, talk of higher counter-cyclical buffers, as well as sliding bond yields, the deflationary bogeyman for European banks, which in turn is sending European credit risk higher this morning.

Whatever the reason, it appears that whatever risks were latent and starting to emerge as a result of trade war concerns as starting to spread as contagion now hits Europe’s arguably most sensitive sector.

(MW) Deutsche Bank to sell $1 bln shipping-loan book

(MW) Deutsche Bank AG (DBK.XE) said Tuesday that it has agreed to sell a $1 billion shipping-loan portfolio to an entity owned by funds Oak Hill Advisors and Varde Partners.

The transaction is expected to close early in the third quarter, the bank said. It didn’t disclose the name of the entity.

“Following this disposal and other derisking strategies we have implemented, the bank will be left with a performing and a run-off shipping book,” Deutsche said.

(Nasdaq) Deutsche Bank’s misleading CDS hide a wider truth

(Nasdaq) Pity poor Christian Sewing. As if the Deutsche Bank boss didn’t have enough on his plate, prices for the German lender’s credit default swap spreads have ballooned. That matters less than it might seem, but underlines a worrying scepticism towards the new CEO’s strategy.

In fact, the rise in CDS spreads has limited immediate consequences. It could theoretically affect up to 176 billion euros of funding that Deutsche raises from wholesale markets. But the bank only needs to renew around 25 billion euros this year, of which it has already issued 11 billion euros. The majority of the balance, around 7 billion euros to 9 billion euros, will rank ahead of unsecured debt and are relatively unaffected by CDS prices. That leaves just 5 billion euros to 7 billion euros of bonds left to issue.

Higher spreads might also spook funds and other banks that trade with Deutsche, making them less willing to do business. But the bank argues that counterparties rank above senior unsecured creditors under German law, meaning they should not be too worried about short-term changes in its CDS spreads.

However, the rise in Deutsche’s CDS does reflect growing concerns about its weak profitability – and whether Sewing will enjoy any more success in his restructuring than predecessor John Cryan. If Sewing struggles, the bank’s funding costs will creep up, and rating firms lower their assessment of its creditworthiness. Over time, that would hurt Deutsche’s profitability, and cause it to lose more market share.

Deutsche is targeting a 10 percent return on tangible equity by 2021. UBS reckons that implies 32 billion euros of revenue, or growth of 4 percent for the next four years. The last time Deutsche enjoyed that level of growth was between 2009 and 2012. Little wonder investors remain sceptical.

– The spread on Deutsche Bank’s five-year credit default swaps has more than doubled from around 70 basis points at the beginning of the year to 167 basis points on June 11, according to Eikon.

– Credit default swaps are contracts used to protect against the risk of a company defaulting, or to speculate on a change in its creditworthiness. A spread of 166 basis points means it would cost 166,000 euros annually to hedge 10 million euros of bonds.

– Deutsche Bank is currently undergoing a restructuring under new Chief Executive Christian Sewing to boost returns and earn a 10 percent return on tangible equity by 2021, up from a negative 1.4 percent return in the latest financial year. Sewing said on April 26 that he wanted to shift the bank away from volatile investment banking “to more stable revenue sources” and strengthen its core business lines.

(BBG) Who Really Runs Deutsche Bank?

(BBG) Poor leadership has left investors in the dark about the lender’s strategy and direction.

What a gift to mark the European Central Bank’s 20th anniversary. Germany’s largest lender, Deutsche Bank AG, is being battered by financial markets, hounded by U.S. regulators, and downgraded by credit-rating companies.

It’s fitting then that, despite CEO Christian Sewing’s effort at a pep talk on Friday, it is sources from the ECB that have come out to reassure markets.

There are eerie parallels between the bank’s misery and the situation under Sewing’s predecessor, John Cryan, in 2016. Back then, the firm seemed to be veering from one existential crisis to another, from concerns over its ability to pay the interest on some of its debt, through to the cost of a multi-billion-dollar U.S. mortgage settlement.

Cheap bank funding from the ECB and implicit support from the German government eventually calmed markets, while Cryan’s promise of a leaner, less risky Deutsche Bank helped secure $8.5 billion in fresh capital from investors. The survival hurdle was cleared.

What’s concerning today, after two straight annual losses in 2016 and 2017, is that so little seems to have changed. The bank has a new CEO, but still no clear answer about how it will become a structurally and consistently profitable business.

Last week’s promise of more than 7,000 job cuts seemed to herald yet more revenue shrinkage and staff defections. Management’s mixed messages on whether the firm will cut back, stand still or double down on the U.S. market — one where it frankly can’t compete as a full-service institution — have sown confusion. Deutsche is eyeing a 10-percent return on tangible equity, but JPMorgan analysts reckon that it will be only be at half that by the end of 2020. It’s grim.

Sewing’s attempts at reassuring staff and investors won’t work without a clearer picture about what the bank is about to embark on and what Deutsche Bank will look like when it reaches its destination.

“There’s no reason for us to be discouraged,” Sewing told colleagues in his latest missive. “We have reduced risk by billions of euros, we have strengthened capital and we have reorganized our bank.”

This sounds like a farewell from his predecessor, not the opening salvo of a new arrival. It would be better to warn staff that the bank is about to go through hell, but will come out better on the other side. Rival UBS Group AG took steps years ago to exit business lines and slash jobs; Deutsche Bank still needs to do likewise.

This all requires tough decisions and, ultimately, leadership. Sewing has had an inauspicious start, but still has time to deliver more than what he has promised. Until then, expect investors to look to policymakers, rather than management, for reassurance about Deutsche Bank’s future.

(Reuters) Australia threatens ANZ, Deutsche and Citi with criminal charges over share issue

(Reuters)bAustralia is preparing criminal cartel charges against the country’s third-biggest bank and underwriters Deutsche Bank and Citigroup over a $2.3 billion share issue, in an unprecedented move with potential implications for global capital markets.

The pending charges, which can carry hefty fines and 10-year prison terms, threaten to change the way institutional capital raisings are handled, and do further damage to the reputation of Australian lenders already mired in scandal.

The Australian Competition and Consumer Commission (ACCC) said federal prosecutors would charge Australia and New Zealand Banking Group Ltd (ANZ.AX), its Treasurer Rick Moscati, the two investment banks and several more unnamed individuals over the 2015 stock placement.

All three banks denied wrongdoing and vowed to defend the charges, with Citigroup saying the regulator was effectively criminalizing practices long seen as the norm in the financial industry.

“The charges will involve alleged cartel arrangements relating to trading in ANZ shares following an ANZ institutional share placement in August 2015,” ACCC Chairman Rod Sims said in a statement.

“It will be alleged that ANZ and the individuals were knowingly concerned in some or all of the conduct.”

The third underwriter, JP Morgan, was not named by the regulator as a target and declined to comment.

Australia has some of the toughest anti-cartel laws in the world, however the decision to pursue criminal charges surprised experts given they are harder to prosecute than civil charges.

The move was “almost unique” in Australian corporate history and indicated prosecutors had a high level of confidence in their case, said Andrew Grant, a banking expert at the University of Sydney Business School.

ANZ shares were 2 percent lower on Friday afternoon, while other banks were down less than 1 percent. The broader market was down 0.2 percent.

Rating agency Moody’s said on Friday the charges were “credit negative” for ANZ.

THE CAPITAL RAISING

In 2015, Australian banks were under pressure to meet new capital requirements, prompting ANZ and larger rival Commonwealth Bank of Australia (CBA.AX) to raise a combined A$8 billion in a single week.

The lead managers did not disclose they kept about 25.5 million shares of the 80.8 million shares issued, ANZ said on Friday, a fact that is being investigated separately by the corporate regulator.

The Australian Shareholders’ Association said the pending charges should trigger reforms to capital raising procedures to ensure greater transparency and prevent investment banks profiting from share sales while retail investors have their holdings diluted.

As new bank equity flooded the market, ANZ shares closed 7.5 percent lower on Aug. 7, 2015, when the Melbourne-based lender announced it had completed the institutional component of the raising, according to a Reuters analysis.

ANZ shares took over a year to recover to their pre-raising value of A$32.58.

The joint underwriters allegedly reached an understanding on the disposal of shares, prompting the cartel criminal charges, Citigroup (C.N) said on Friday.

“Underwriting syndicates exist to provide the capacity to assume risk and to underwrite large capital raisings, and have operated successfully in Australia in this manner for decades,” the New York-headquartered investment bank said.

Criminal charges for share underwriters had never been considered by an Australian court and had never been addressed in guidance notes published by regulators, it added.

“If the ACCC believes there are matters to address, these should be clarified by law or regulation or consultation,” it said.

Deutsche Bank (DBKGn.DE) said it was cooperating with investigators and took its responsibilities “extremely seriously”.

Caron Beaton-Wells, a professor of competition law at University of Melbourne, said the ACCC and the prosecutor would only bring criminal charges if they were satisfied they would be proven.

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“The ACCC has long said … that the most potent deterrent for cartel conduct is a potential jail term,” Beaton-Wells said.

“I don’t think it’s a sudden decision to ramp up, just that it’s taken a long time to find conduct for proceeding criminally.”

The development compounds a publicity nightmare for Australia’s biggest financial firms as they grapple with almost daily allegations of wrongdoing at a public inquiry which is scheduled to run to the end of the year.

Barristers for the inquiry have raised the prospect of criminal charges against the country’s top wealth manager, AMP Ltd (AMP.AX), over allegations it misled the corporate regulator.

No. 1 lender Commonwealth Bank is also facing a separate civil lawsuit alleging thousands of breaches of anti-money laundering protocols.

The allegations against some of Australia’s biggest companies and most-traded stocks have sparked several class action law suits designed to compensate investors who lost out as a result of poor banking and fund manager practices.

(NYP) Deutsche Bank reportedly set to lay off 10,000 workers

(NYP)

Heads are rolling at Deutsche Bank again.

The beleaguered German bank is reportedly planning to lay off as many as 10,000 employees, or 10 percent of its workforce, through next year.

The planned cuts, which are coming about two months after the bank elevated its new CEO Christian Sewing, accelerate and deepen layoffs that were planned by the last top exec, John Cryan, the Wall Street Journal reported Wednesday, citing sources.

Cryan had planned to shed 9,000 positions around the world by 2020. It’s unclear how many of those had actually been cut, although the bank reportedly laid off 400 workers in the US last month. Among the deep cuts are a full-on retreat from stock trading in the US and a pullback in other parts of the world.

The planned firings come after nearly a decade of scandals, settlements and management missteps.

The bank was a dominant Wall Street trading house until the 2008 financial crisis. Since then, it has been trying to cut costs and placate unhappy shareholders who are sick of seeing the bank’s stock trail peers like JPMorgan Chase.

In one particularly desperate cost-slashing move, Deutsche Bank recently shortened its paid “gardening” leave periods for departing bankers — a policy designed to protect the bank’s competitive information — to 30 days from as much as 90 days previously, The Post first reported last week.

The bank has also shut down much of its Houston energy trading operations, and is also moving to smaller offices in Midtown Manhattan, from Wall Street.

Kerrie McHugh, a Deutsche Bank spokeswoman, declined to comment.

(BBG) Eisman of ‘The Big Short’ Fame Recommends Shorting Deutsche Bank

(BBG) Eisman of ‘Big Short’ Says ‘Deutsche Bank Is a Problem Bank’

Steve Eisman, the Neuberger Berman Group money manager who famously predicted the collapse of subprime mortgages before the 2008 financial crisis, recommended shorting Deutsche Bank AG shares.

“Deutsche Bank is a problem bank,” Eisman said in a Bloomberg Television interview in Hong Kong. The German lender has “profitability issues,” and will probably have to raise capital next year, he said, without disclosing his position on the shares. A Deutsche Bank representative declined to comment on the remarks.

New Chief Executive Officer Christian Sewing is embarking on a sweeping overhaul of the struggling investment bank to focus more on European clients, walking away from ambitions to be a top global securities firm. Germany’s largest lender will scale back U.S. rates sales and trading, reduce the corporate finance business in the U.S. and Asia and review its global equities business. The measures will lead to a “significant reduction” in the workforce this year.

The firm has to “shrink dramatically,” Eisman said.

Deutsche Bank shares have slumped almost 34 percent in the past 12 months, the second-worst performance on the MSCI Euro index. The decline also dwarfed the 4.9 percent drop in the Bloomberg Europe 500 Banks index in the same period. Deutsche shares gained 0.4 percent in morning trading on Monday.

While Deutsche Bank’s return on equity trails that of its main competitors, the bank’s capital cushion is comparatively strong. It boasts a Tier 1 equity capital ratio of 13.4 percent, above the average among its largest peers, data compiled by Bloomberg show.

Eisman also recommended bearish bets against Canadian financial companies and reiterated that he is still short Wells Fargo & Co.

The investor’s early bets against the housing market before the 2008 crisis were chronicled in Michael Lewis’s 2010 book “The Big Short,” which highlighted money managers who profited from the market turmoil. A character based on him was played by Steve Carell in the movie of the same name.

Eisman worked at hedge fund FrontPoint Partners LLC when he made money betting against the U.S. housing market. Eisman joined New York-based Neuberger Berman after closing his hedge fund Emrys Partners in 2014.

+++ P.O. (BBG) Deutsche Bank Is Said to Weigh Cutting U.S. Staff About 20%

P.O.

…And the question is…

…What is Deutsche Bank’s future as an investment bank taking into account all the mishap’s, all the scandals, all the law suits (most of them not reflected in the balance sheet),and the loss of credibility?

…And taking into account what it seems to be an innate corporate culture of not abiding by any rules.

…I would argue somber at least.

…And that’s being kind.

Please be so kind and revisit my Personal Opinions on Deutsche Bank

Thank you for your time.

Francisco (Abouaf) de Curiel Marques Pereira

(BBG) Deutsche Bank AG is considering a sweeping restructuring in the U.S. that could result in the firm cutting about 20 percent of staff in the region, according to people briefed on the matter.

The bank is nearing a decision and the final reductions may end up lower, one of the people said, asking not to be identified because the details are confidential. Bloomberg reported in April a plan to slash more than 10 percent of jobs in the U.S. — where its workforce was 10,300 at the end of 2017 — as the German lender retreats from businesses it deems less competitive.

“There are no such plans,” said Joerg Eigendorf, a spokesman for the firm in Frankfurt.

Deutsche Bank, led by Chief Executive Officer Christian Sewing, is considering cuts to businesses including prime brokerage, rates and repo, according to a bank statement last month and people familiar with the matter. The firm is already planning to close an office in Houston and shrink its presence in New York City, moving from Wall Street to a midtown Manhattan space that’s 30 percent smaller.

Deutsche Bank shares were little changed at 11.45 euros as of 9:02 a.m. in Frankfurt. They’ve declined about 28 percent this year, making the lender the second-worst performing stock on the Bloomberg Europe 500 Banks and Financial Services Index.

Read more: Deutsche Bank joins exodus from Wall Street

Deutsche Bank isn’t targeting a specific level of cuts at the U.S. unit and the final figure will depend on each business line’s decisions, according to another person briefed on the matter. The U.S. makes up about a tenth of its global workforce.

The U.S. business is already seeing some senior defections. The bank said in memos Tuesday that Barry Bausano, a longtime senior executive overseeing relations with hedge fund clients, and Jonathan Richman, head of trade and financial supply chain for the Americas, are leaving.

Bausano will step down as chairman of the business with hedge funds and as CEO of Deutsche Bank Securities, the company’s U.S. broker-dealer. The 54-year-old has helped lead efforts to retain big trading clients in recent years, after some grew concerned about the bank’s strength as a counterparty.

Richman, who has spent 10 years at the firm, is pursuing another opportunity and will be replaced by Juan Martin and Giovanni Saladino. The trade business is part of the bank’s global transaction banking unit, which produced 15 percent of its revenue last year.

+++ P.O. (BBG) Deutsche Bank’s Global M&A Head Thomas Piquemal Is Leaving Firm

 P.O.
…One more top executive is leaving Deutsche Bank…

…And i don’t think it will be the last…

…Please be so kind and revisit my Personal Opinions on Deutsche Bank.

Thank You

Francisco

(BBG) Deutsche Bank AG’s top M&A banker is leaving the firm, the latest senior departure to follow a leadership struggle this year.
Thomas Piquemal, also chief country officer for France, is leaving to pursue other interests, according to a Deutsche Bank memo seen by Bloomberg and confirmed by a company spokesman. His M&A responsibilities will be shares by regional heads Robin
Rousseau, Charlie Dupree and Mayooran Elalingam. Piquemal will join Financiere Marc de Lacharriere SA, the French holding company known as Fimalac, the firm said in a statement.
Deutsche Bank said last week that it will scale back U.S. rates sales and trading, reduce the corporate finance business in the U.S. and Asia and review its global equities business with a view toward cutting it back.
The Frankfurt-based lender is reviewing the future of its investment bank, whose future was a key factor in the tumultuous management shakeup that saw Christian Sewing take over as chief executive officer from John Cryan last month.

+++ P.O. (BBG) Deutsche Bank Is Said to Weigh Retrenchment in U.S. Equities

P.O. 

Dear All

Please make some time and revisit my Personal Opinions on Deutsche Bank.

Better safe than sorry.

Saying

Said when you think it is best not to take risks even when it seems boring or difficult to be careful. (Cambridge Dictionary)

Got it?

Francisco (Abouaf) de Curiel Marques Pereira

(Bloomberg) — Barely two weeks into the job, Deutsche Bank AG’s Chief Executive Officer Christian Sewing is considering a retreat that could mark the end of the bank’s two-decade quest to compete with Wall Street.

Sewing is weighing extensive cuts to the lender’s cash equities business in the U.S. and may announce details as part of a wider restructuring of its investment bank when he reports earnings on Thursday, people familiar with the matter told Bloomberg. They asked not to be identified because the details are confidential.

Such a move, if it happens, would effectively signal a sharper focus on the lower-risk business of private and commercial banking in its European home market. Under Sewing’s predecessors, Deutsche Bank built the investment bank into Europe’s largest with ambitions to compete head-to-head with U.S. firms. John Cryan, who started to reverse that push over the past few years, was ousted this month for being to slow to execute a new strategy.

The bank’s supervisory board will discuss the future of the investment bank Wednesday. No final decision has been made, according to the people.

Deutsche Bank’s stock, the second-worst performer among European banks this year, rose 3.0 percent in response to the news to 12.03 euros by 12:15 in Frankfurt Tuesday. Bloomberg first reported the changes under consideration on Monday.

The possible cuts to U.S. equities, where costs outrun revenue even after a bull market stretching back nearly a decade, would be a “first step in the right direction,” said Stefan Mueller, the head of Frankfurt-based finance boutique DGWA. He said the bank has proven it’s “unable to make money in this business no matter what the market circumstances.”

‘Sufficiently Profitable’

According to research by JPMorgan Chase & Co., the Americas equities business had revenue of some 600 million euros ($733 million) last year. Lead analyst Kian Abouhossein estimates that the unit spent five dollars for every four it earned.

In a first memo to staff, Sewing had taken a tough line on costs, saying the bank will pull back from areas where it’s “not sufficiently profitable.” The bank said in its annual report that cash equities revenue was little changed from 2016, without providing figures.

A spokeswoman for Frankfurt-based Deutsche Bank declined to comment.

Cash equities, or the trading of regular stocks, has traditionally been a core business of investment banks, but regulation and technology have made it less profitable in recent years.

“The retrenchment, if it happens, will be a double-edged sword,” said Markus Riesselmann, an analyst with Independent Research, who has a sell recommendation on the stock. “It’s probably too late for Deutsche Bank to regain its competitiveness in U.S. cash equities and other areas of the investment bank. But the decision does raise the question whether Sewing will be able to achieve revenue growth.”

Doubts about future revenue generation are among the strongest arguments against cutting too aggressively. When Standard & Poor’s Ratings Group put Deutsche Bank’s issuer credit rating under review for a downgrade from A- earlier in April, it said that “we consider that a prolonged, deepened, or more costly restructuring would lead the bank to remain a negative outlier for an extended period.”

Revenue Concerns

Dropping into the BBB rating bracket would make the bank’s extensive derivative business more expensive and leave it even more vulnerable to competition from the biggest — and more highly-rated — U.S. banks.

“They’re pretty significant on the institutional side,” said Larry Tabb, founder of market research firm Tabb Group LLC. Still, intense competition among brokers means the bank’s clients will have plenty of other options, he said.

Read more: Deutsche Bank seen lagging U.S. peers in stock trading

Sewing and Garth Ritchie, the head of the investment bank who built his career in cash equities, are currently reviewing all operations of the division, particularly the U.S. operations, according to people familiar with the matter. The review, internally dubbed ‘Project Colombo’, is assessing each unit according to three or four criteria: how profitable it is, whether its products are critical for clients, how much regulatory capital it ties up, and how much investment it would need to be competitive in future.

The cash equities business has suffered from a transition to automated trading and passive investing, both of which have cut the need for human input into day-to-day equities trading. Data compiled by Coalition Development Ltd. Global show that revenue from that business across 12 of the largest firms dropped to a total of $9.2 billion in 2017, the lowest since at least 2006.

What business remains has structurally “moved away from banks,” Cryan said on his last quarterly earnings call with analysts in February.

+++ (BBG) What Deutsche Bank’s Equities Review Means for a Top Dark Pool

(BBG) News that Deutsche Bank AG might pull back in U.S. equities has big implications for its dark pool, the fourth biggest in the country.

Banks often feed client orders to their own dark pools — private markets that hide the presence of orders until they’re executed. So any pullback from trading U.S. stocks would probably reduce the amount of business taking place on the Deutsche Bank market. A company spokeswoman declined to comment.

Banks started setting up dark pools more than a decade ago to cut costs by avoiding higher fees at exchanges. But it’s gotten more expensive to run markets because of the technology needed to keep them competitive.

Leaders in the ranking have been shifting positions in recent years. Goldman Sachs Group Inc. was once near the top, but has since fallen to about eighth place, according to the weekly tally done by the Financial Industry Regulatory Authority. Goldman has moved up slightly since overhauling its dark pool last year with Nasdaq Inc.’s help

For now, Deutsche Bank is still formulating its plan. The Frankfurt-based lender is considering extensive cuts to its cash equities business in the U.S. as part of a wider restructuring of its investment bank, according to people familiar with the matter. A decision may be made as soon as this week.

(BBG) Deutsche Bank’s Bad News Just Gets Worse With $35 Billion Flub

(BBG) The bad news at Deutsche Bank AG just got worse.

Amid a weeks-long leadership tussle that claimed the scalps of the chief executive and two top lieutenants and tainted the chairman, the bank inadvertently transferred 28 billion euros ($35 billion) to one if its outside accounts, Bloomberg News has revealed.

While the blunder was quickly reversed and caused no financial harm, it’s a stark reminder of the vulnerability of even the most sophisticated financial firms. For Deutsche Bank, the mistake comes at a delicate time as the new CEO, Christian Sewing, seeks to convince investors the bank can now return to growth. His predecessor, John Cryan, had already tackled an improvement in controls that had failed the lender in the past.

“Fat-finger incidents are common within banks but automated controls should prevent their execution,” said Michael Huenseler, a portfolio manager at Assenagon Asset Management, which owns Deutsche Bank stock. “The shocking amount in the case of Deutsche Bank points to deficiencies in the bank’s IT functionalities, which lends new weight to Kim Hammonds’s critical remarks and raises urgent questions about the potential costs of changing the systems.”

In this instance, a routine payment went awry last month when Germany’s biggest lender unintentionally sent the sum to an exchange as part of its daily dealings in derivatives, a person familiar with the matter said. The mistake came to light after the bank pushed out three executives including Cryan and Chief Operating Officer Hammonds within two weeks. Both had focused on improving internal processes, though the incident didn’t contribute to the dismissal of either, two people with knowledge of the matter said.

The errant transfer occurred about a week before Easter as Deutsche Bank was conducting a daily collateral adjustment, the person said. The sum, which far exceeded the amount it was due to post, landed in an account at Deutsche Boerse AG’s Eurex clearinghouse, temporarily boosting the collateral held by the world’s fourth-largest clearinghouse by more than half.

“This was an operational error in the movement of collateral between Deutsche Bank’s principal accounts and Deutsche Bank’s Eurex account,” Charlie Olivier, a spokesman for Deutsche Bank, wrote in an emailed statement. “The error was identified within a matter of minutes, and then rectified. We have rigorously reviewed the reasons why this error occurred and taken steps to prevent its recurrence.”

Deutsche Bank’s Hammonds Leaves as Exits Continue After CEO

It’s another misstep for Deutsche Bank after its third straight annual lossand when — in common with other lenders — it faces increased scrutiny from regulators. Cryan, who was CEO for three years, said in a speech earlier this year that the bank was approaching the end of “phase 1” of his restructuring, which bolstered internal controls and shrunk the number of operating systems at the bank to 32 from 45.

Deutsche Bank shares, which have fallen 27 percent this year, were down 1.6 percent on the day at 11.49 euros as of 1:21 p.m in Frankfurt, underperforming both the benchmark German DAX index and sectoral peers in Europe. Analysts at cross-town rival Commerzbank Thursday slashed their target price for the stock from 15 euros to 11, calling it the “cactus among investment banks” because it’s “spiky and slow growing.”

‘Its embarrassing’

“A bank mistakenly making such a large transfer shows its controls aren’t working adequately, and it’s embarrassing,” said Dieter Hein, an analyst at Fairesearch who has the equivalent of a sell recommendation on the bank’s stock. “This kind of incident shows that the bank’s problems are so big that you can’t fix them immediately. Cryan failed.”

Hein also said Hammonds bears some of the blame given her involvement in Cryan’s information-technology revamp. Hammonds reportedly called Deutsche Bank “the most dysfunctional company” she’d ever worked for, and hasn’t denied making the remarks.

Bear Trap

The error should have been caught by an internal fail-safe system known as a “bear trap,” a person familiar with the matter said. The mechanism was set up after an internal audit at the bank triggered by an earlier collateral payments error in March 2014, the person said.

While such errors do occur, the amount involved — more than the bank’s market value of around 24 billion euros — is highly unusual, according to the person.

Deutsche has had other problems with payments in recent history too. In June 2015, a junior member of its Frankfurt-based foreign exchange sales team mistakenly sent $6 billion to a U.S. hedge fund client. The bank recovered the money a day later.

Eurex held back 4 billion euros of Deutsche Bank’s funds over the weekend of March 23, the person said. A spokesman for Deutsche Boerse said the company doesn’t comment on single transactions or client relationships.

Deutsche Bank’s new CEO, Christian Sewing, is seeking to turn around the worst-performing member of the Stoxx 600 banks index this year. Analysts have said Sewing’s appointment raises questions about the lender’s future direction, especially the under-performing investment bank business.

In a separate development, Germany’s biggest bank has been asked by the European Central Bank to simulate an orderly wind-down of its trading book, Chief Financial Officer James von Moltke told Bloomberg Monday. Deutsche Bank is the first to receive such a request from the ECB, according to a person familiar with the matter, who said the ECB is using Europe’s largest investment bank as a “guinea pig” before it sends similar requests to other banks.

Deutsche Bank’s Chief Regulatory Officer Sylvie Matherat said in an interview with German media that the bank will bolster its departmentfor compliance, regulatory issues and fighting corruption by another 400 people by year-end, making it 3,000-strong.

+++ P.O. (BBG) Deutsche Bank COO Hammonds to Leave as Exits Continue After CEO

P.O.

…In the cards…

…As per my numerous Personal Opinions on Deutsche Bank…

Please revisit my last one 

+++ P.O. V.I. (BBG) Deutsche Bank Names Sewing CEO, Replacing Cryan in Broad Revamp

I quote myself:

«P.O.

…Ah…

…It was true after all the denials…

…But in my opinion, and as i have written many times before, there no way        Deutsche Bank can be fixed…

…Not even one month ago i was informed “first hand” (direct personal             knowledge) that they continue with their more than doubtful practices…

…Please be so kind and revisit my Personal Opinions on Deutsche Bank.

…They will never learn…

…Unfortunately.»

Francisco (Abouaf) de Curiel Marques Pereira

(BBG) The chaotic shakeup at Deutsche Bank AG sent more aftershocks through the bank’s top ranks as its chief operating officer was ousted and its head of investor relations quit.

Kim Hammonds, who reportedly called Deutsche Bank “the most dysfunctional company” she’d ever worked for, will leave “by mutual agreement” at the annual general meeting on May 24, the Frankfurt-based lender said late Wednesday. Earlier, the bank announced that John Andrews, head of investor relations for five years, is leaving because of the recent management changes.

Their exits come days after Christian Sewing took over as chief executive officer from John Cryan amid a sustained slump in the share price and questions about the direction of Europe’s largest investment bank. Sewing’s appointment was the third major change at the top of Deutsche Bank in six years, and followed weeks of intense speculation about Cryan’s future while Chairman Paul Achleitner stayed silent. Marcus Schenck, co-head of the securities unit, also left as the company debates how big a role it wants to play in global investment banking.

“The way Achleitner replaced the CEO was unprofessional and damaging for everyone involved,” Klaus Nieding, vice president of shareholder advisory DSW, said by phone before the departure of the COO was announced. “But Hammond’s demise is of her own making. She shouldn’t have made those comments,” he said, referring to the “dysfunctional” remarks made at an internal event in March.

The bank may use Hammonds’s departure to cut the size of its management board and hand her responsibilities to another board member, German newspaper Handelsblatt reported Thursday. It suggested that Chief Administrative Officer Karl von Rohr, who was promoted to co-president in the reshuffle earlier this month, is the likeliest candidate, without citing any named sources.

Handelsblatt also suggested that cutting a board position with specific and exclusive responsibility for IT could raise eyebrows at Germany’s banking regulator Bafin, given the bank’s past problems with the issue. A spokesman for Deutsche Bank declined to comment, while a spokesman for Bafin said that there is “no legal requirement” for the bank to make IT a board-level competence. “It is purely a business policy decision,” he said.

‘Fresh Air’

Hammonds had been tasked with bringing the bank’s information technology costs down and streamlining the number of operating systems. But concerns about slow progress have led to skepticism among supervisory board members and management that she’s the right person, people familiar with the matter said earlier this month. Her standing was hurt further when reports surfaced about her disparaging comment. Hammonds hasn’t disowned the remarks since they became public.

“Kim Hammonds has been a breath of fresh air, bringing an outsider’s perspective with deep experience in transformational change,” Achleitner said in the release. The bank will appoint a new COO “in the near future,” after consulting with regulators, it said.

Deutsche Bank was down 0.4 percent as of 1:30 p.m. in Frankfurt, bringing losses this year to 27 percent. That makes Deutsche Bank the second-worst of the 42 companies in the Bloomberg Europe Banks and Financial Services Index, with only state-rescued lender Banca Monte dei Paschi di Siena SpA declining more.

Achleitner himself has come under fire for his part in the upheaval. Board members and investors have criticized him for weeks of media leaks about his hunt for a new CEO, his failure to find credible external candidates and his choice of Garth Ritchie as head of the investment bank, people familiar with the matter have said. The 61-year-old faces a rough ride at Deutsche Bank’s annual shareholder meeting in May from investors who say he’s as much to blame as Cryan for the lender’s woes.

Raising Capital

Cryan was unable to restore revenue growth after cutting risk, though he did manage to settle billion-dollar legacy misconduct cases and shore up capital. Last year, he raised 8 billion euros ($9.9 billion) from investors in a share sale. This year, he sold a minority stake in Deutsche Bank’s DWS asset management business in an IPO.

Investor relations chief Andrews, who previously held the same post at Citigroup Inc.Morgan Stanley and Goldman Sachs Group Inc., played a key role in both transactions. He will be replaced by James Rivett, currently head of fixed-income investor relations, according to a memo to employees signed by finance chief James von Moltke.

“John feels that this is the right time to take this step with the leadership changes recently announced,” von Moltke wrote. “John has helped the bank navigate many challenging and important milestones.”

In a separate development, at least four investment bankers at Deutsche Bank’s London office are leaving, people familiar with the matter said Wednesday. The departures include Guillaume Gnech, a director in equity derivatives trading, Neal Naidoo, who worked in systematic trading, and Jonny Edelman in hedge fund sales.

(BBG) Deutsche Bank COO Hammonds’s Future at Lender Is in Doubt

(BBG) Deutsche Bank AG Chief Operating Officer Kim Hammonds’s future at the lender is uncertain, a little over a week after the dismissal of the chief executive, according to people with knowledge of the matter.

Concerns about slow progress in upgrading the bank’s information technology systems — together with unhappiness at controversial statements made by her — have led to skepticism among supervisory board members and the bank’s management that she’s the right person for the job, the people said asking not to be identified discussing private details.

The supervisory board has not yet taken a decision on her future at the company yet, they said. But her departure, if it comes, could happen very soon, two people said.

Hammonds has struggled to bring the bank’s IT costs down, and they rose fractionally last year to 3.80 billion euros ($4.68 billion) from 3.78 billion in 2016. She defended her record recently by saying she has cut the number of operating systems used by the bank by nearly one-third and sharply cut the bank’s reliance on external staff. Her internal standing was further hurt recently when she called Deutsche Bank “the most dysfunctional company” she’d ever worked for at an internal event, according to people briefed on the matter. Hammonds hasn’t disowned the comments since they became public.

The questions about Hammonds come at a time of leadership turmoil at Deutsche Bank. Chief Executive Officer John Cryan was replaced on April 8 by Christian Sewing, and Marcus Schenck, a former deputy co-CEO, is also leaving the bank. Supervisory board Chairman Paul Achleitner said in a statement that day that the bank was looking to achieve “a new execution dynamic in the leadership of our bank.”

“The manner in which these management changes were carried out – very publicly and without a clearly signaled plan – raises questions about the cohesiveness of senior management and its ability to execute on its plans,” Lisa Kwasnowski and Elisabeth Rudman, analysts at ratings agency DBRS, said in a note to clients Monday.

FAZ first reported that Hammonds may have to leave the company soon. Hammonds didn’t immediately respond to a request for comment.

+++ P.O. V.I. (BBG) Deutsche Bank Names Sewing CEO, Replacing Cryan in Broad Revamp

P.O.

…Ah…

…It was true after all the denials…

…But in my opinion, and as i have written many times before, there no way        Deutsche Bank can be fixed…

…Not even one month ago i was informed “first hand” (direct personal             knowledge) that they continue with their more than doubtful practices…

…Please be so kind and revisit my Personal Opinions on Deutsche Bank.

…They will never learn…

…Unfortunately.

Francisco (Abouaf) de Curiel Marques Pereira

(BBG) Frankfurt: Deutsche Bank AG named Christian Sewing to replace chief executive officer John Cryan after less than three years amid mounting questions about the future direction of Europe’s largest investment bank.

Sewing, a lifelong Deutsche Bank employee, will take over with immediate effect, the lender said in a statement from Frankfurt late Sunday. Garth Ritchie was promoted to sole head of the securities unit and will become a deputy CEO, along with chief administrative officer Karl von Rohr. Cryan and Marcus Schenck, who was co-deputy CEO with Sewing, are leaving the bank.

The appointments follow weeks of intense speculation about the bank’s leadership that forced Cryan to say publicly he was committed to the role while the chairman raced to find an agreement with shareholders regarding a potential successor. The supervisory board wasn’t unanimous in adopting some of the measures proposed by Achleitner, according to people familiar. A particular sticking point was the proposed leadership change at the investment bank, one person said.

“We need a new execution dynamic in the leadership of our bank,” Achleitner said in a statement thanking Cryan for his service.

Deutsche Bank has seen three top leadership appointments in six years amid pressure from investors to improve profitability and reverse a share slump. The strategy of Germany’s biggest lender and how big a role it still wants to play in US investment banking is still a matter of contention. Cryan reduced risk and settled billion-dollar legacy misconduct cases, but failed to restore revenue growth despite raising fresh capital.

Retail banker

Sewing, who joined Deutsche Bank in 1989 as an apprentice, was most recently in charge of the unit overseeing commercial and retail banking as well as wealth management. He won plaudits for successfully negotiating job cuts in the German retail unit with the influential workers’ councils, implementing the agreement on schedule and without a strong media backlash.

Sewing also headed Deutsche Bank’s internal probe into its role into alleged money laundering at the bank’s Russian unit, the so-called mirror trades, which led to the lender shuttering its securities unit in the country.

Frank Strauss, who ran the private and commercial bank jointly with Sewing, will become sole head of that unit.

Ritchie, a two-decade veteran of the bank who oversees all trading operations, had been weighing options about his future, people said last week. He joined Deutsche Bank in 1996 and rose through the ranks of its equities-trading division to become sole head of that business in 2010.

Deutsche Bank’s revenue from trading stocks and bonds, its biggest single source of income, has tumbled 32% since the end of 2015, triggering concern among investors.

Schenck, who co-led the investment bank with Ritchie, didn’t want a position in the new management team and informed the board before Easter that he planned to leave, Deutsche Bank said.

“We very much regret Marcus Schenck’s decision and thank him for his contribution in a crucial period for our bank,” Achleitner said.

Over recent weeks, Achleitner intensified a search for a successor. Discussions focused on a leader who speaks German and who works well with regulators, people familiar with the matter said. Sewing, along with Schenck and chief financial officer James von Moltke, had been seen as the top internal contenders, while the bank and its backers have also reached out to external candidates including Bank of America Corp.’s Christian Meissner and ex-JPMorgan Chase & Co. executive Matt Zames, people familiar with the matter said last week.

Achleitner’s Search

Achleitner broke off his vacation to meet with stakeholders the past week to discuss his next move, people familiar with the discussions have said. The run of CEOs and strategy changes since he became chairman in 2012 has also led some analysts and investors to question Achleitner’s responsibility.

In recent days, investors have expressed mixed views on Cryan and who should replace him. At least two key investors have been pushing for his ouster, while another has signalled it won’t stand in the way if Achleitner removes him, said people familiar.

Cryan, then a supervisory board member himself, took over in mid-2015 with a mandate to stabilize and clean up the company. Just over a year ago he named Schenck and Sewing deputy co-CEOs as part of the company’s latest strategy overhaul.

+++ (BBG) Deutsche Bank Lifer Sewing Tapped to Steer Lender Through Chaos

(BBG) The era of investment bankers calling the shots at Deutsche Bank appears to be over.

Christian Sewing — a three-decade veteran of the Frankfurt-based lender and retail banking executive — was named to succeed the Briton John Cryan after a meeting of the bank’s supervisory board late Sunday. The decision ended a dramatic few weeks of turmoil at Europe’s largest investment bank as Cryan fought for his position and Chairman Paul Achleitner quietly approached potential replacements.

Sewing’s ascent marks the return of a German national as sole CEO for the first time in 16 years. As part of the overhaul, Garth Ritchie will lead the investment bank — which remains at the core of the bank’s problems — and was elevated to co-deputy CEO with Chief Administrative Officer Karl von Rohr.

At first glance, Sewing, 47, seems chosen to complete the task that outgoing CEO Cryan began but failed to complete quickly enough — that of shrinking Deutsche’s investment bank and making a coherent whole out of its domestic retail and commercial operations. In an interview earlier this year, he had sided with Cryan, saying that “the basic direction the bank is taking is the right one. We shouldn’t play around with the strategy.”

Having joined Deutsche as an apprentice in the homely Westphalian town of Bielefeld, Sewing marks a contrast with globe-trotters such as former CEOs Josef Ackermann and Anshu Jain. He’s worked most of his life at Deutsche Bank — except for a two-year stint at a smaller lender — and commutes back to his wife and four children in Osnabrueck on weekends, more than 200 miles away from the German financial capital.

Burnished Standing

Sewing burnished his standing within the bank in recent years by managing the downsizing of its domestic operations, and by curtailing the excesses of its investment bankers. He notably cut 188 branches and about 4,000 jobs from the German retail unit without provoking a strong backlash from German media, for whom Deutsche is a favorite punching-bag.

Sewing also took charge of the internal probe into alleged money-laundering at Deutsche’s Russian business, prompting the bank to shutter its securities unit there, with over 1,000 employees.

In recent weeks, Achleitner had intensified his search for a new CEO, looking for a leader who speaks German and works well with regulators, people familiar with the matter said. That opened the way for internal candidates Sewing, co-deputy CEO Marcus Schenck and Chief Financial Officer James von Moltke. But it didn’t stop the bank and its backers sounding out external ones including Bank of America Corp.’s Christian Meissner and ex-JPMorgan Chase & Co. executive Matt Zames, people familiar with the matter said last week.

‘Stood Ready’

“Sewing may not necessarily have been the top candidate, but he was there and stood ready,” Hans-Peter Burghof, a banking and finance professor at the University of Hohenheim in Stuttgart, Germany, said by phone. “It is too early to say what strategy Sewing would pursue because it depends on the bank’s big investors as well. Several of them are quite keen on investment banking and see it offering a better chance to return to profit than retail banking.”

Sewing’s promotion raises big questions over the future of Deutsche’s investment bank, the source of most of its profits, but also of its most expensive governance scandals. The bank had to pay $7.2 billion last year to settle a U.S. Justice Department probe into its mis-selling of mortgage-backed securities before the financial crisis, and it has also incurred heavy fines for manipulating benchmark interest rates and lax anti-money laundering controls in Russia.

Having been pipped by Sewing to the top job, Schenck will now leave the bank, making way for Ritchie to take over at the head of the division which the company has been considering scaling back.

Crucial Role

Ritchie joined Deutsche 22 years ago, working his way up to co-head of equities a decade ago. Generally media-shy, he played a crucial role liaising with clients and regulators during the bank’s crisis of confidence in late 2016, when the prospect of heavy U.S. fines briefly appeared to threaten Deutsche’s viability (and prompted his father in Johannesburg to call to ask him if he still had a job). Ritchie’s firefighting at that time made a lasting impression on Achleitner, according to a person with knowledge of the matter.

Speaking on the bank’s pre-crisis expansion in an interview last year, Ritchie admitted the rapid growth is still hurting the bank. “We grew very fast with mercenaries and acquired teams, and they grew banks within banks,” he said. “Our biggest mistake was not putting those teams together.”

However, one of the great cultural conflicts that undermined Cryan’s final days seems unlikely to go away with Ritchie’s promotion: Ritchie had supported Schenck’s push for bigger bonus payouts to investment bank staff for 2017.

Von Rohr, who alongside Ritchie was named co-deputy CEO, moved up under Cryan in 2015, becoming chief administrative officer with management board responsibility for corporate governance, human resources and legal. He also became the bank’s labor relations director.

Investors gave a muted reaction to Sewing’s appointment. One top-five shareholder described him as an “OK” choice that they wouldn’t oppose. A second said Sewing will be good for the bank but added that the appointment showed Achleitner wasn’t able to find a better external candidate. Those who fret about his relatively low profile outside Germany overlook his stints in Singapore, Hong Kong, London and Toronto, a person close to Sewing said, noting that his role as deputy chief risk officer exposed him, with a high degree of authority, to all areas of the business.

(BBG) Deutsche Bank Plans Board Shifts as Chiefs’ Future Is Questioned

(BBG) Deutsche Bank AG is preparing to reshuffle its supervisory board as the future of Chief Executive Officer John Cryan and Chairman Paul Achleitner is called into question.

John Thain, a former CEO of Merrill Lynch, is expected to join the troubled German bank in May, according to a person with knowledge of the lender’s plans. He is one of four nominees invited by the supervisory board to fill positions coming open this year, said the person, who asked not to be identified because the matter isn’t public.

Cryan has been struggling to retain investor backing amid a slump in revenue despite resetting strategy since taking over in 2015. Concerns about the bank’s turnaround prompted Achleitner to hold discussions with potential successors, people with knowledge of the discussions said last week. The chairman is also coming under fire for having failed to forge a recovery after going through three CEOs in six years.

“I definitely welcome the overhaul of the supervisory board, although I would have liked to see it happen earlier,” said Andreas Meyer, who manages fixed income securities including Deutsche Bank bonds at Aramea Asset Management in Hamburg.

He noted the shift to more directors with financial-sector backgrounds on the board, though a balance might be preferable, he said. “Should Achleitner now decide to replace Cryan, he has to step down as well,” said Meyer. “He has been chairman of the supervisory board since May 2012 and that means he shares responsibility for the current situation.”

Absolutely Committed

Speculation about Cryan’s position prompted the executive to tell staff on March 28 that he’s “absolutely committed” to serving the bank and continuing his work.

It’s the latest challenge to hit the 148-year-old institution, which has struggled to recover from the financial crisis that exploded in 2008. A sustained slide at the investment bank has contributed to hundreds of job cuts as the firm seeks to curb costs and improve returns. The shares have declined nearly 30 percent since the start of the year.

The bank is now conducting a fresh review of its trading businesses, Bloomberg News reported last week. Cryan is examining activities where Europe’s largest investment bank is trailing competitors to determine if it should try to win back market share or exit, said people familiar with the review, dubbed Project Colombo.

The relationship between Achleitner and Cryan has been strained for a while. The chairman has been critical of the CEO’s performance and was taken aback last year when Cryan discussed the prospect of a contract renewal beyond 2020 in interviews with Bloomberg and Handelsblatt, according to people familiar with the matter. That deterred efforts to prepare for a possible succession, they said.

While much of the discontent has focused on Cryan, one top shareholder also criticized Achleitner for failing to replace Cryan sooner. Other analysts and investors — pointing to the turmoil at the bank during his tenure — have said the chairman also bears responsibility for the bank’s travails.

New Faces

Michele Trogni, a former executive at IHS Markit Ltd. and UBS Group AG, and Mayree Clark, a former Morgan Stanley wealth-management executive, are set to join the board along with Thain, said the person.

Deutsche Bank supervisory board members whose terms expire this year are Johannes Teyssen, Dina Dublon, Henning Kagermann, and Louise M. Parent.

Achleitner has contacted possible candidates including Juerg Zeltner, UBS Group AG’s former wealth-management chief, about replacing Cryan, but the talks haven’t progressed to an offer for the post, people with knowledge of the matter told Bloomberg News. Other possible options included Standard Chartered Plc CEO Bill Winters and UniCredit SpA chief Jean Pierre Mustier, the people said.

(BBG) Deutsche Bank Is Considering More Cuts at Investment Bank

(BBG) Deutsche Bank AG is conducting a fresh review of its trading businesses, according to people familiar with the discussions, an overhaul that Chief Executive Officer John Cryan is pursuing to help restore profitability amid reports that the bank is seeking to replace him.

Cryan, who sought to quash rumors he may be ousted in a staff memo on Wednesday, is examining businesses where Europe’s largest investment bank is trailing competitors to determine if it should try to win back market share or exit, the people said, asking not to be identified as the plans are private.

The future of the investment bank, the lender’s largest unit by revenue, has been a central point of contention in Cryan’s restructuring efforts since he took over in mid-2015. Investors’ frustration with the lack of growth prompted Chairman Paul Achleitner to search for a successor to the CEO, people familiar said this week. Speculation about his position prompted Cryan to tell staff that he’s “absolutely committed” to serving the bank and continuing his work.

“We need to demonstrate more visibly the excellent progress we are making in some many areas so that doubts about our bank fade away over time,” Cryan wrote in the memo seen by Bloomberg and confirmed by the bank. “We need to focus on executing on the strategy that was agreed and signed off by both the management and supervisory boards,” he wrote.

“Project Colombo”

Senior executives plan to complete the review of the investment bank, dubbed “Project Colombo,” within weeks, before deciding where to cut and where to invest, said two people. The U.S. operations are a particular focus, though the review stretches across the global trading unit, the people said. A spokeswoman for Deutsche Bank declined to comment.

For more on the conflict between the CEO and Chairman click here.

As part of the investment bank review, cuts are being discussed at both big trading businesses — equities as well as fixed income, currencies and commodities — because they are expensive and haven’t performed well, said one person. However, the extent of a potential retrenchment is unclear because many traders just got big bonuses in an effort to retain top performers, this person said.

It’s also unclear how the search for a new CEO will affect the review. Cryan, in the memo, acknowledged the “destabilizing effect” that the “widespread rumors” are having.

“The fact that Cryan must write his own defense and doesn’t get any backing from Achleitner is a sign of weakness for the CEO,” said Florian Sauerburger, a portfolio manager at Aramea Asset Management, which owns Deutsche Bank stock. “Achleitner seems only to think about his own job.”

Prior Cutbacks

Much of the prior cutbacks at the investment bank affected fixed-income trading, though revenue at the equities unit declined as well. The bank lost clients in late 2016 amid concerns about its financial strength. Revenue from trading has declined by about a third in the past two years.

Deutsche Bank’s trading revenue has shrunk from 12.7 billion euros in 2010 — or about 44 percent of total income — to 8.7 billion euros or 33 percent last year as Cryan pivoted away from the bank’s former focus on institutional clients toward corporate clients.

The CEO last year merged the global markets division with the corporate and investment bank, reversing the decision from 2015 to split the businesses. In the 2017 overhaul, the bank named former finance chief Marcus Schenck to help oversee the new unit, while Cryan himself assumed oversight for the lender’s U.S. operations. The bank recently hired a former Goldman Sachs executive, Peter Selman, in a bid to revive the equities business.

‘Growing Revenue’

“I am focused on growing revenue and prudently managing expenses to improve profitability,” Selman said in an interview earlier this year. Along with hiring graduates, Selman said he will invest in Deutsche Bank’s technology to build a “best-in-class electronic platform” over the long term. The bank already has good products for derivatives clients, he said.

To read more about Deutsche Bank’s equities business, click here.

Chief Financial Officer James von Moltke said at a conference in London last week that any cuts to the investment bank would probably be gradual.

“We will take actions to prune the business this year,” Von Moltke also said at the conference. Radical cuts are “not something we think is advisable and the right thing either for the franchise or for shareholders,” he said.

+++ P.O. (BBG) Deutsche Bank Seeking Replacement for CEO, London Times Says

P.O.

Deutsche Bank has been and is an unimaginable pile of problems as per my numerous Personal Opinions.

Please revisit them at https://searchbonus.eu/category/deutsche-bank/

Personally i doubt that Deutsche Bank has the will or that it will be possible to successfully restructure it.

Francisco (Abouaf) de Curiel Marques Pereira

(Bloomberg) — Deutsche Bank AG is considering candidates
to potentially replace Chief Executive Officer John Cryan amid
heightened tensions between him and Supervisory Board Chairman
Paul Achleitner, the Times of London reported without saying
where it got the information.
The bank approached Richard Gnodde, the head of Goldman
Sachs Group Inc.’s international operations, but he’s thought to
have spurned the overture, the newspaper said. Deutsche Bank
also considered UniCredit SpA CEO Jean Pierre Mustier and
Standard Chartered Plc CEO Bill Winters, according to the
report.
Disagreement between Cryan, 57, and Achleitner, 61, has
flared over strategy, with the CEO and Chief Financial Officer
James von Moltke pushing for a more radical restructuring of
businesses including the investment bank, the newspaper cited a
senior source as saying. Cryan also irked Achleitner last year
by avoiding a meeting with one of the company’s top
shareholders, HNA Group Co., the Wall Street Journal reported in
October. The Chinese government has since pushed the indebted
conglomerate to unwind an acquisition binge.
Read more: Deutsche Bank says ‘of course’ CEO will see
Chinese investor
Deutsche Bank spokeswoman Monika Schaller declined to
comment on the Times’s report. The newspaper said Goldman Sachs
also declined to comment.
Last March, Cryan laid out the Frankfurt-based firm’s third
strategy revamp in as many years, pledging to return to
“controlled growth.” A sustained slide at the investment bank
has since contributed to hundreds of job cuts to curb costs and
improve returns. Trading at the unit, headed by Marcus Schenck
and Garth Ritchie, slumped 27 percent in the fourth quarter,
while fees from advising on deals and arranging debt and equity
sales slipped 3 percent.
Von Moltke spotlighted current challenges at the division
at an investor conference last week. That included the euro’s
gain against the dollar, which may reduce the unit’s revenue by
about 300 million euros ($368 million) this quarter from a year
earlier, he said.
Read more: Deutsche Bank CFO warns of securities unit
headwind
Schenck is also viewed internally as a strong candidate,
the Times cited one former executive as saying. At an event
hosted by Bloomberg in London last week, Schenck said the lender
still has some work to do to convince shareholders that its
turnaround is on track.
“John has always made it very clear — look, this is not a
one-quarter journey. This is a several-year journey,” Schenck
said of Cryan. “We think we’re on the right path with that
journey. But we definitely are a show-me case.”