Deutsche Bank is reported to be planning to lay off about 9000 employees in Germany, mostly back office and support staff. The objective is to cut costs. Of the Company’s 91,700-strong workforce, about 41,700 are employed in Germany itself.
Outside Germany, the maximum impact will be felt by the employees in London, with Brexit being one of the reasons. Even some staff in the US will be rendered jobless, when the Bank closes its equities trading business.
Following the economic slump in the country and fear of recession, Deutsche Bank is restructuring majorly to cut costs. The Bank’s head of business had quit because he did not support the restructuring strategy. The new head of the retail unit in Germany is exploring cost saving options. Amongst his plans, he is thinking of converting the Bonn headquarters into an outpost and also do away with the separate legal structure of the retail unit, which will result in huge savings— about hundreds of millions of euros—which would have otherwise been spent on compensations and regulatory expenditure.
The final decisions are yet to be taken.
Meanwhile, the shares of the Bank have already dipped by three per cent. In fact, they have seen a fall of about 10 per cent in 2019.
Two years back, Postbank had merged with Deutsche Bank, which had also made some employees redundant.
Of the 2.3 billion euros that Deutsche Bank is expected to save in costs, in about three years, 60 per cent will be contributed by the retail bank. Expenses in the retail unit may fall by about six per cent annually, on an average.
As of now, the job cuts will not affect employees occupying client-facing positions. However, with increasing automation of workflows, the jobs of support staff in Florida, Philippines and India may be under threat.