Deutsche Bank’s London staff ‘are told they must clear their desks by 11am’ as the German firm announces it will cut 18,000 jobs world-wide by 2022
- Workers were told to pack up their belongings hours after restructuring revealed
- In some cases, staff were told their building passes would be deactivated today
- Comes after German firm revealed it would cut 18,000 jobs world-wide by 2022
- Frankfurt-headquartered bank said layoffs would reduce annual costs by £5.4bn
Staff at Deutsche Bank’s London office were told to clear their desks by 11am after the struggling German firm revealed it would cut 18,000 jobs world-wide by 2022.
Workers were told to pack up their belongings just hours after the major restructuring was announced by the firm, which employs 8,000 people in the UK.
In some cases, staff were told that their building passes would be deactivated by the afternoon, giving them just a few hours to say goodbye to their office space.
On Sunday, the Frankfurt-headquartered bank said the mass layoffs would reduce its annual costs by £5.4billion.
The 91,500 employees are set to be cut by just over 20 per cent, to 74,000, in an unprecedented round of departures for Deutsche.
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People walk past a Deutsche Bank office in London this morning following news of job losses
Employees in London were expected to find out more about their fates today, with several seen leaving the office building this morning carrying large bags.
The Telegraph’s banking editor Lucy Burton wrote on Twitter today: ‘Some Deutsche Bank staff in London told they have until 11am to pack up their stuff, just hours after the overhaul was announced.
‘”I’m trying to get my head straight,” says one person who has been told his pass will stop working in a few hours.’
The Guardian reported how 100 people had been made redundant on the fourth floor while some members of staff were seen leaving the office in tears.
The cut backs from the bank – which paid billions in fines and settlements after the 2008 financial crash – comes after concerns the UK economy is at a standstill.
Data firm Markit’s PMI tracks the private sector and reported shrinking business activity in June.
Chris Williamson, economist at IHS Markit, told The Financial Times: ‘The latest downturn differs from that seen in 2016 as it has followed a gradual weakening in the rate of economic growth rather than being a sudden and brief collapse in output after the ‘shock’ referendum result.’
Deutsche Bank said today that it would drop its stock sales and trading unit as part of a plan to exit more volatile investment banking activities.
It said it would cut roughly a quarter of its total cost base through steps such as dropping the investment bank’s stock-trading business.
It would also slim down its division focused on fixed-income investments.
The bank would not say where the cuts would fall, but many of its investment banking activities are carried out in Wall Street and London.
It will also slim down its division focused on fixed-income investments. By doing that, the bank is to focus on areas with steadier earnings such as serving corporate customers.
The bank would also create a separate unit to dispose of investments that are less profitable or no longer fit its strategy.
The bank said it did not expect to have to raise additional capital from shareholders.
Christian Sewing, Chief Executive Officer of Deutsche Bank, said: ‘Today we have announced the most fundamental transformation of Deutsche Bank in decades.
A man walks into a Deutsche Bank office in London, where staff were today told to clear their desks
‘We are tackling what is necessary to unleash our true potential: our business model, costs, capital and the management team.
‘We are building on our strengths. This is a restart for Deutsche Bank – for the long-term benefit of our clients, employees, investors and society.’
The move follows the failure of merger talks with German rival Commerzbank.
Deutsche Bank said the combination would not make business sense, but that left open the question of what strategy the bank could pursue to make its business leaner and more profitable.
For years, Deutsche Bank has struggled with regulatory penalties and fines, weak profits, high costs and a falling share price.
The bank went three straight years without turning an annual profit before recording positive earnings for 2018.
CEO Christian Sewing took over last year and promised faster restructuring after predecessor John Cryan was perceived to have moved too slowly to restructure the bank.
The bank paid billions in fines and settlements related to behavior before and after the global financial crisis, including a $7.2 billion settlement in 2017 with the Justice Department over selling bonds based on mortgages to people with shaky credit.
But that hasn’t ended the negative headlines. Two congressional committees have subpoenaed Deutsche Bank documents as part their investigations into President Donald Trump and his company.
Deutsche Bank was one of the few banks willing to lend to Trump after a series of corporate bankruptcies and defaults starting in the early 1990s.
Trump had sued Deutsche Bank to stop the subpoenas, but a judge in May ruled against the president.
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