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Thread: Deutsche Bank will exit global equities business and slash 18,000 jobs in sweeping overhaul

  1. #1

    Deutsche Bank will exit global equities business and slash 18,000 jobs in sweeping overhaul

    Deutsche Bank was one of the few banks still willing to loan money to Trump after his numerous bankruptcies.

    Deutsche Bank announced Sunday that it will pull out of global equities sales and trading, scale back investment banking and slash thousands of jobs as part of a sweeping restructuring plan to improve profitability.

    Deutsche will also cut 18,000 jobs for a global headcount of around 74,000 employees by 2022. The bank aims to reduce costs by 6 billion euros ($6.7 billion) to 17 billion euros in the next several years.

    The German bank announced plans to scale back investment banking just two days after investment banking chief Garth Ritchie stepped down by “mutual agreement.”

    Deutsche expects its restructuring plan to cost 7.4 billion euros by the end of 2022. The German bank may report a net loss of 2.8 billion euros in the second quarter of 2019. It will release second quarter results on July 25.

    Deutsche Bank’s supervisory board met on Sunday to hash out the restructuring plan. The bank’s CEO, Christian Sewing, had broadcast “tough cutbacks” during a shareholders’ meeting in May.

    “Today we have announced the most fundamental transformation of Deutsche Bank in decades,” Sewing said Sunday in a corporate press release.

    Deutsche had previously considered merging with rival Commerzbank to shore up its position, but merger talks collapsed in April. An industry source told CNBC that there wasn’t enough support for a merger within Deutsche.

    The German lender once sought to compete with America’s big banks on Wall Street, but has been pummeled by scandals, investigations and massive fines stemming from the financial crisis and other issues in recent years.

    Deutsche reached a $7.2 billion settlement with the U.S. Justice Department in January 2017 for allegedly misleading investors in the sale of mortgage-backed securities in the lead-up to the 2008 financial crisis. Weeks later, the bank was slapped with a $630 million fine over allegations of Russian money laundering.

    Those penalties came two years after the bank paid a $2.5 billion fine to U.S. and U.K. regulators for allegedly participating in a scheme to rig interest rates.

    Deutsche has come under renewed scrutiny in the U.S. over its business relationship with President Donald Trump. The House Intelligence and Financial Services Committees subpoenaed Deutsche in April for records on Trump’s finances.

    Trump and his family sought to have that subpoena squashed in court, but a federal judge ruled the bank can turn over financial documents to House Democrats.
    Last edited by Zippyjuan; 07-07-2019 at 11:27 AM.

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  3. #2

    How Deutsche Bank Became A Mainstay Of Trump's Business Empire


    How did Germany's most illustrious bank become so important to the business empire of Donald Trump? Deutsche Bank has given the president hundreds of millions of dollars in loans over the years, dating back far before he was president. Congressional investigators have asked Deutsche Bank to turn over the president's carefully guarded financial records, but his lawyers have filed suit to block the subpoenas. NPR's Lucian Kim has the backstory from Berlin.

    LUCIAN KIM, BYLINE: President Trump doesn't like to reveal the details of how he does business. But when he was still on the campaign trail, he gave a little bit away.


    PRESIDENT DONALD TRUMP: It's called OPM. I do that all the time in business. It's called other people's money. There's nothing like doing things with other people's money because it takes the risk.

    KIM: A lot of that OPM came from Deutsche Bank, which kept lending Trump money, even after he defaulted on a loan, even after he sued the bank, claiming it was responsible for his failure to pay his debts. It might seem like baffling behavior for such a venerable institution.

    Deutsche Bank was founded in Berlin in 1870. I've come to its former headquarters, which were housed here in a complex of massive, stone buildings that symbolized solidity and the proximity to power. After World War II, the bank relocated to Frankfurt in West Germany.

    In the 1990s, the bank started taking on ever more risk as it went global.

    DIRK LAABS: There was nothing solid and nothing professional about that bank.

    KIM: That's Dirk Laabs, author of "Bad Bank: The Rise And Fall Of Deutsche Bank." Lending to Donald Trump was only one of many questionable moves. Deutsche Bank bought up mortgage-backed securities and was dangerously exposed when the global financial crisis hit in 2008.

    LAABS: This still comes as a shock for lots of - a lot of Germans. I think it's hard to understand for people abroad how big this bank was and how important it was for the mindset. It's like Mercedes-Benz for cars. That's what Deutsche Bank is for, you know, finance business in Germany.

    KIM: But Dirk Laabs says this image of a bastion of financial prudence didn't reflect the changes that had taken place.

    LAABS: On paper, the headquarter of Deutsche Bank is Frankfurt. But in the mid-90s, the power really shifted to London and to New York.

    KIM: That's when Deutsche Bank started aggressively competing with Wall Street banks. That was also when American banks, which had been burned by Trump's defaults on casino loans, stopped lending to him. German journalist Ingo Nathusius says Deutsche Bank saw doing business with Trump as a price of getting into the game.
    More at link.

  4. #3

    Deutsche Bank to axe 18,000 jobs worldwide in radical restructuring

    7 Jul 2019

    Hundreds of City workers are fearing for their jobs after Deutsche Bank, the global bank that is one of the Square Mile’s largest employers, said it plans to axe 18,000 staff worldwide in the latest attempt to revitalise its reputation and business.

    The layoffs, equivalent to 20% of the bank’s workforce, come after chief executive Christian Sewing flagged an extensive restructuring in May, when he promised shareholders “tough cutbacks” to the investment bank and that he would push ahead with a further €1bn (£880m) in cuts this year.

    The pledge came after similar moves in 2018 that led to 6,000 job losses, and a failure to agree a merger with rival Commerzbank.

    Deutsche Bank, which has recently come under scrutiny over its business relationship with Donald Trump, would not reveal how many staff in its UK operations would be put out of work in the latest round of redundancies, although the numbers are expected to be significant, as London – where the bank is in the process of constructing a new headquarters – is one of of the lender’s largest bases, with around 8,000 staff.

    Sewing, who has been in the job for just over a year, said: “We are tackling what is necessary to unleash our full potential … We are building on our strengths. This is a restart for Deutsche Bank.”

    Paul Achleitner, chairman of Deutsche’s supervisory board, said: “Deutsche Bank has been through a difficult period over the past decade, but with this new strategy in place, we now have every reason to look forward with confidence and optimism.”

    Deutsche Bank has suffered multiple blows to its reputation over the past year, having failed US bank stress tests, suffered downgrades to its investment grade ratings, and had its offices raided by German police in November as part of a money-laundering investigation linked to the Panama Papers revelations.

    Following the raid, the bank said that it had “no concrete evidence that would support the allegations against us or any of our employees”.

    The bank has also paid billions in fines and settlements relating to behaviour before and after the global financial crisis, including a $7.2bn settlement in 2017 with the US Justice Department over the sale of bonds based on mortgages to people with unreliable credit.

    As a lender to Trump, despite a series of corporate bankruptcies and defaults starting in the early 1990s, Deutsche Bank has been subpoenaed by two congressional committees for documents as part of investigations into the US president and his company. Trump sued Deutsche Bank to stop the subpoenas, but a judge ruled in May against the president.

    The latest plan to relaunch the bank involves closing its equities sales and trading arm, which is essentially a giant stockbroking operation that buys and sells publicly listed shares on behalf of large hedge funds or asset managers. Most of the staff employed in that division are based in London, New York and Hong Kong.

    Deutsche Bank said it would also “resize” its fixed-income operations – which principally involve government and corporate bonds – and create a bad bank in which to place and offload its unwanted assets.

    To make the cuts, the lender is expecting costs of around €7.4bn by the end of 2022, which will include €3bn in the second quarter of 2019.

    The Frankfurt-based bank expects a €2.8bn net loss in the second quarter as a result of the restructuring charges.

  5. #4
    They could lay them all off for all I care .

  6. #5
    Corrupt scum. shut it all down.

  7. #6
    the only person who still works at my local bank is frank
    A savage barbaric tribal society where thugs parade the streets and illegally assault and murder innocent civilians, yeah that is the alternative to having police. Oh wait, that is the police

    We cannot defend freedom abroad by deserting it at home.
    - Edward R. Murrow

    ...I think we have moral obligations to disobey unjust laws, because non-cooperation with evil is as much as a moral obligation as cooperation with good. - MLK Jr.

    How to trigger a liberal: "I didn't get vaccinated."

  8. #7
    Bye now . Sounds like global equities trading was a loser for them.

  9. #8
    Quote Originally Posted by oyarde View Post
    Bye now . Sounds like global equities trading was a loser for them.
    This is one of the financial institutions I've made reference to over the past couple of years as a plausible trigger point I'm watching. They apparently have some investigations going on now as well, since they apparently reported profits of less than $270 million in 2018....when there is no way a bank that big only made that amount of money. Their derivative exposure is something like $45 to $50 trillion globally, FYI.

    Curiously......since this announcement, JP Morgan and another large institution whose name I can't remember atm put out red flag warnings over global economic health concerns.
    "Self conquest is the greatest of all victories." - Plato

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  11. #9
    Bank Run: Deutsche Bank Clients Are Pulling $1 Billion A Day
    "The Patriarch"

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