German banking giant Deutsche Bank announces plans to fire almost 20,000 employees and exit equities sales and trading business.
German banking giant Deutsche Bank had announced plans to fire almost twenty thousand employees and exit its equities sales and trading business.
According to a 7th July Reuters report, though the bank plans to retain a small-scale equity capital markets operation, it effectively marks the end of its traditional investment arm – and arm which is said to have generated €1.96 billion in revenues in 2018.
The reorganisation is expected to result in the loss of about 18,000 jobs and translate to a 40% reduction in risk-weighted assets that are allocated to the bank’s trading operations. According to the report, that represents around €74 billion, along with €288 billion of leverage exposure as of 31st December 2018.
The new was seized upon by well-known Bitcoin bull and Morgan Creek Digital Assets co-founder Anthony “Pomp” Pompliano, who tweeted:
“Deutsche Bank plans to fire almost 20,000 employees. Bitcoin has no employees to fire. DB is built for the old world. And Bitcoin is built for the new world.”
As part of its plan, DB will create a so-called “bad bank” or Capital Release Unit, to manage the wind-down of assets.
Several commentators have already observed that central bank policies are making it extremely difficult for traditional investment banks to make a profit, and are, inadvertently driving the adoption and growth of cryptocurrencies.
Others have also pointed to the structural deficiencies of traditional financial markets; for example the way that they are only open during business hours – whereas digital asset markets are open 24/7.
