Deutsche Bank resize means job losses in SA
The bank is cutting jobs in all its global operations, and its branch in Sandton is going to be downsized
German investment bank Deutsche could become the latest bank to add to SA’s unemployment woes with plans to lay off employees.
Absa and Standard Bank have also announced their intention to retrench staff. Retrenchment processes are also underway at a number of companies, including MultiChoice and ArcelorMittal.
Deutsche Bank told Business Day on Thursday that it has already begun retrenchment processes globally but it was yet to confirm how many jobs will eventually be cut at its SA branch in Sandton.
“Regarding job cuts, it is too early to comment on specific details, and we are not breaking down regional numbers with regard to the number of roles impacted by the closure of the equities sales and trading business. We can confirm that cuts to this business have started globally,” said the bank’s spokesperson for the Europe, Middle East and Africa region, Stuart Haslam.
On Sunday, the bank issued a statement announcing a series of restructuring initiatives to help it reduce costs as it is grappling with dwindling revenue. In the first quarter of 2019, revenue fell 9% year on year, and in the second quarter Deutsche Bank said it expected to report a net loss of about €2.8bn. Cutting costs is one initiative the company has identified to offset declining revenue.
In the statement on Sunday, issued on the same day the company announced leadership changes, Deutsche Bank said it had resolved that it should exit its global equities sales and trading business but will retain a focused equity capital markets operation. It also plans to reduce the size of its fixed income operations to create a leaner investment bank business. At the same time, it will create a new division, the Corporate Bank.
“In aggregate, Deutsche Bank will reduce risk-weighted assets currently allocated to these businesses by approximately 40%,” the company said, referring to operations falling under its corporate and investment banking division.
The bank said it wanted to focus on and invest in its core businesses, which include corporate banking, foreign exchange, asset management and private banking.
Haslam said the bank remained committed to its global operations, including those in SA.