Deutsche Bank has announced the elimination of over 100 positions in its senior private wealth and retail banking divisions as part of an ongoing cost-cutting strategy aimed at improving efficiency within the German financial institution.
The latest round of job cuts includes 111 senior managers within the bank’s private banking division, which handles both private wealth and retail banking. The affected employees are primarily high-level global managing directors and directors. This move is part of a broader initiative to reduce operating costs and streamline operations at Deutsche Bank.
The bank’s current cost-cutting objectives aim to bring the cost-to-income ratio in its private wealth and retail units down to between 60% and 65% by 2025, a significant decrease from 80% in 2023, and 77% for the first three quarters of the current year. This reduction is part of Deutsche Bank’s efforts to meet its financial targets for the next year, which also include revenue growth across all divisions.
Deutsche Bank’s private banking division, which has faced significant challenges in recent years due to underperformance, IT issues, and failure to meet profitability goals, currently accounts for just 23% of the bank’s profits. Despite contributing 31% to the bank’s overall revenue, the division has struggled to meet cost-efficiency targets. As a result, the bank has made changes at the top, including the departure of two former heads of private banking, following dissatisfaction with the division’s financial performance.
However, under the leadership of Claudio de Sanctis, the current head of private banking, investors are hopeful for a turnaround. De Sanctis, who has already initiated significant restructuring by merging management levels and closing 300 branches in Germany, has committed to improving the private banking division’s cost-efficiency. The bank has also reduced the number of front-office employees and cut back on external consultancy expenses. At the same time, de Sanctis has announced plans to hire more wealth management employees in the upcoming year as part of efforts to revitalize the division.
In addition to these cost-cutting measures, Deutsche Bank is also focusing on growth in emerging markets, particularly India. The bank has invested approximately €571 million into its Indian operations, with a focus on areas such as sustainable finance and digital transformation. Alexander von zur Muehlen, CEO of Deutsche Bank’s Asia Pacific, Europe, Middle East & Africa (EMEA) region, expressed confidence in India’s potential, highlighting the country’s strategic position in the face of shifting global trends, including supply chain reshaping, digitalization, and demographic changes.
Kaushik Shaparia, CEO of Deutsche Bank in India, reiterated the importance of the investment, describing it as a vote of confidence in the bank’s business model and growth potential in India. As Deutsche Bank continues to expand in the region, it aims to strengthen its relationship with clients, offering top-tier services and expertise to support their needs.
