2016 has not been the year of the lender, with traditional banking giants such as Deutsche Bank, Standard Chartered, and others facing dwindling revenues, profits, and a tsunami of restlessness from shareholders anxiously awaiting a reversal to the trend. Balance sheet gurus, shareholders, and employees may have to wait a little longer however, following the recent sentiment by Deutsche Bank’s CEO John Cryan Wednesday.
According to a CNBC report, Cryan reiterated his stance on more cuts, which echoes a previous statement back in July that backed additional cost cutting measures. His latest words appear to double down on the pledge, which stated that staff levels “should be 30% lower”.
The news is quite unwelcome for Deutsche Bank employees, who to date have already survived a wave of job cuts and scaling measures across the company’s global operations, most prominently felt in the UK. Indeed, as far back as October 2015, Deutsche Bank originally embarked on a plan to gut upwards of 35,000 workers worldwide, though it is unclear if Cryan’s current wishes for cuts would alter that figure.
Cross Border Mergers?
One thing thus far has been perfectly clear – Deutsche Bank, along with many of its banking counterparts, in Europe are facing an onslaught of pressure to right the ship. While the majority of job cuts have been relegated to back office or technology positions, given costs of labor in the UK, many fixed income or foreign exchange (FX) desks have disappeared entirely or at a minimum have consolidated to help cut costs.
Another point of emphasis from Cryan was a possible merger of European banks to help solve addled balance sheets. The Deutsche Bank CEO made a rare cross-border plea at cooperation and potential mergers, though any such alliance is currently a ways off from coming to fruition. Still, the idea is hardly novel but could be a next or potential last resort should fortunes not reverse by Q3 earnings later this year.
(Photo: Gregor Fischer via flickr)