Play it again, John
Deutsche Bank’s new chief executive John Cryan tops the charts for headline job losses —35,000 compared to less than 3,000 announced at Credit Suisse last week — but his plan for the investment bank is far less radical.
It’s scary to look at from the outside, but he’s just scooped out the pith and carved it into the season’s favoured shape.
Here, in no special order, are the ideas at the heart of Deutsche’s next five year plan.
Close far flung offices and simplify legal structures. Run down the unprofitable back book. Better IT systems, which talk to each other. Skinnier management structures and fewer committees. Get rid of low value clients. Cross-sell more products to the best clients.
The previous plan, Deutsche Bank’s “Strategy 2015+”, promised to target the top 450 multinationals, to integrate systems in fixed income and currencies, and to develop centralised counterparty management. Project Integra, two Deutsche Bank restructurings ago, wanted more co-operation across the bank, more focus on top level clients, and less balance sheet out to low returning business.
These are clichés of post-crisis banking; shareholder-friendly pieties that mean business as usual but a little more efficiently. Finding an investment bank without these aspirations would be challenging indeed.
But maybe this time it really is different. Cryan has already purged management, dropped the dividend and reorganised the bank — enough radical measures to make Deutsche’s bankers sit up and pay attention.
Let’s hope that the turnaround plan works, and the next Deutsche strategy is a change of record.