Deutsche Bank outlines organisation of revamped investment bank
- Pakistan ‘processing’ visa applications of Kulbhushan Jadhav’s wife, mother
- Theresa May says Brexit deal proves critics wrong
- UN council weighs measure rejecting US Jerusalem decision
- Ahead of Gujarat election results, BJP MP predicts dismal performance for party
- California’s wildfire now ranks as state’s third-largest
Frankfurt: Deutsche Bank has outlined clearly differentiated roles for the co-heads of its revamped investment bank to make it more efficient and is also creating a new global markets division.
In an email to employees on Wednesday, Deutsche Bank said it wanted to reduce bureaucracy and simplify the organisation, which would in turn lead to substantial cost savings this year.
Marcus Schenck and Garth Ritchie, named this year to lead the reorganised corporate and investment bank, outlined in the email how they would split their duties.
Germany’s largest lender has been trying to regain its footing after a series of scandals, lawsuits and bets that went wrong pushed it to the brink of collapse last year.
The memo said Schenck would concentrate on clients, overseeing corporate finance, global capital markets, and the bank’s institutional client group.
Ritchie will focus on products and processes, supervising equities, fixed income and currencies, global transaction banking, electronic trading, listed derivatives and clearing, research and the division’s technology and operations.
The new global capital markets division announced in the memo will be jointly headed by Alexander von zur Muehlen in Frankfurt and Mark Fedorcik in New York.
Schenck and Ritchie said the changes would take effect on 1 July, when Schenck moves to the corporate and investment bank full time after serving as Deutsche’s chief financial officer.
Bloomberg News first reported the details of the memo.
Earlier this year, Deutsche Bank said it would combine its divisions for markets, corporate finance and global transaction banking into a single corporate and investment bank (CIB) as part of a broader restructuring of Germany’s biggest lender.
In the memo, Schenck and Ritchie said the executive committee of the corporate and investment bank (CIB) had asked a special team “to reduce bureaucracy and complexity, which will achieve substantial cost savings in 2017.”
“Their success will directly affect CIB’s 2017 profitability and compensation programme,” the email said. “We ask you to support them as they implement changes.”
Deutsche Bank transformed itself into a major player on Wall Street over the past two decades, but bets that backfired and a series of scandals resulted in a litigation bill of €15 billion ($16.8 billion) since 2009.
While rivals spent the years since the 2008 collapse of Lehman Brothers cleaning up and finding new business models, Deutsche Bank did not restructure as quickly as others and was hit by a series of lawsuits over its conduct.
The bank has settled its most painful litigation cases, including the alleged manipulation of interest rates and sham equities trading in Russia, which surfaced as late as 2015.
At the end of last year it finally settled with the US Department of Justice for misselling toxic mortgages, agreeing to pay $7.2 billion. Reuters