Shares of Germany's largest bank rose Monday a day after new CEO John Cryan announced a management shake-up and reorganization that signalled the bank was serious about taking the painful steps necessary to recover its footing.
Deutsche Bank on Sunday announced a major reorganization and appointed six people to its top management board.
Shares of Deutsche Bank, Germany’s largest bank, rose Monday a day after its new chief executive, John Cryan, unveiled a management overhaul and reorganization that aimed to restore the institution to sustainable profitability.
In a flurry of appointments, Deutsche Bank named six new members to its management board as Mr. Cryan put in place a management team he will rely on to steer the Frankfurt-based bank out of a sea of legal, financial and image problems. Among the appointments are two women, the first named to the top panel.
In a second major shift, the bank said it will split its investment banking division into two parts. Analysts said the major shake-up was a hopeful sign that Deutsche Bank, which has pursued a “cultural change” following the 2008 global financial crisis, would follow through on reforms with actions.
“What this means is that finally Deutsche Bank has realized that a change in culture has to involve a change in leadership,” said Matthias Bank, the dean of the school of management at the Institute of Banking and Finance at the University of Innsbruck in Austria. “What is happening now at Deutsche Bank is a top-down change. It can’t be changed from the bottom up. Now, there’s a better chance that the new leadership will make that happen.”
Shares in Deutsche Bank rose more than 3 percent as trading opened Monday morning in Frankfurt. It was trading up 3.11 percent at €26.84 by 10:30 local time in Frankfurt. Mr. Cryan, who took over the bank in July and previously served as chief financial officer at Swiss bank UBS, is tasked with restoring shareholder confidence in Deutsche Bank by boosting profits.
The six executives appointed to Deutsche Bank’s board were not closely associated with the departing co-chief executives, Anshu Jain, who left the bank in July, and Jürgen Fitschen, who is leaving the bank next May.
Five senior officials have also been let go or reassigned – including two board members – all of whom had worked under Mr. Jain and were singled out for criticism by German regulators for failing to stop the manipulation of benchmark interest rates.
“All of the new people appointed were not part of the old guard,” Mr. Bank said. “I think that is a clear signal.”
Mr. Cryan has now set out the team that will help him turn around the bank by retrenching to its roots in Germany and Europe. The management changes came just 10 days before he is scheduled to unveil a new strategy for the bank on October 29.
Mr. Cryan is pursuing three goals with the restructuring, according to sources close to Deutsche’s leadership: He wants to bring the bank closer to its customers; streamline responsibilities in the management board; and put people on the board who are considered team players and will support his plans for a major overhaul of the bank by 2020, the so-called “Strategy 2020.”
“Mr. Cryan wants to create a genuine team on the board instead of having lone warriors from the era under Anshu Jain,” a source close to Deutsche Bank’s leadership told Handelsblatt.
To continue reading this story, click here to go to Handelsblatt Global Edition.
Auf tippen, dann auf „Zum Home-Bildschirm“ hinzufügen.
Auf tippen, dann „Zum Startbildschirm“ hinzufügen.×