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Deutsche Bank AG plans to cut about 800 senior back-office staff as Chief Executive Officer (CEO) Christian Sewing steps up cost reductions amid a slowdown in the trading business that has fuelled much of the lender’s growth.
Deutsche Bank announced the steps alongside first-quarter earnings that showed revenue from fixed-income trading slumped 17%, one of the worst performances among the investment banks that have reported results so far. The decline was offset by a 35% jump in revenue at the corporate bank, allowing the lender to post its strongest top line since 2016.
Sewing is increasingly leaning on the corporate and private bank to drive growth as the trading boom of the past years peters out and Europe emerges from its experiment with negative interest rates. While he’s managed to lift revenue growth and profitability, high inflation and investment in controls have caused frequent expense overruns since he took over five years ago.
The job cuts should help the firm save an additional €500 million annually by 2025, bringing its medium-term target to €2.5 billion.
To support cost reductions, Deutsche Bank is shrinking its management board to nine members from the current ten, the lender said.