Germany’s largest bank, has announced plans to cut 9,000 fulltime jobs and 6,000 part time contractor jobs, following losses in third quarter earnings.
Deutsche Bank Announces £4.3bn Loss, Plans To Cut 15,000 Jobs
Deutsche Bank also said that it plans to sell some of its businesses over the next two years, a move that could lead to a further loss in 20,000 jobs.
Out of the 9,000 full time jobs that will be eliminated, 4,000 will be in Germany. According to data on its annual report, the bank employed 98,000 workers at the end of 2014.
According to John Cryan, co-chief executive at the bank, ‘By 2018 we anticipate that the benefits of our hard work will be evidence and that we will experience a strong turn-around.’
The job cuts amount to less than 15% of the bank’s workforce.
Deutsche bank’s shares dropped by 5.5% on the Frankfurt stock exchange. The bank is looking to trim up to €3.8bn of its yearly costs as banks in Europe battle slow economic growth as well as increasingly stringent industry regulations.
Job cuts are seen as a viable solution to boost profits against a background of slow growth.
Deutsche is also in talks to sell up to 20% of its stake in Postbank to China’s Hua Xia Bank, after listing it on the stock market. Dividend payments for financial year 2015-2016 will also not be paid out.
At a news conference, Mr. Cryan said ‘We must reduce the complexity at Deutsche bank.’
As part of its restructuring and cost cutting measures, the bank is set to shut down businesses in Mexico, Finland, Peru, Uruguay, Denmark, New Zealand, Chile, Mexico, Malta and Argentina.
Deutsche reported losses amounting to £4.3bn in the third quarter. The losses are attributable to legal expenses, assets on sale and write-down charges.