Frankfurt Deutsche Bank boss Christian Sewing has a new mantra: “This time we are part of the solution.” Unlike the financial crisis, the bank should not be a burden but a blessing for society during the pandemic. Sewing apparently sees the corona crisis as an opportunity to repair the battered image of the money house. To this end, the institute’s expanded leadership group is to make a symbolic sacrifice.
Over the past few weeks, Sewing has repeatedly emphasized that Deutsche Bank is not only there for all old customers in the crisis, but also for new ones. But fighting the deepest recession since time immemorial is not enough for the CEO.
Just in time for the general meeting this week, Sewing launched a large-scale sustainability offensive. The bank is also trying to emphasize empathy internally – despite the reduction of 18,000 jobs.
According to top management, according to information from financial circles, the level below should also forego a monthly salary. In a conference call last Thursday, the bank asked managers to voluntarily waive their wages. The Financial Times first reported on the initiative.
In his speech to the Annual General Meeting, Sewing announced that the job cuts interrupted by the pandemic would be resumed. At the same time, the banker announced that all members of the Executive Board and the Executive Committee would waive one month’s fixed salary.
In doing so, Deutsche Bank followed the example of other European institutes. In February, the bonuses of the board members for 2019 caused criticism among investors and entrepreneurs despite a partial waiver.
Calling the next lower management level is primarily a signal of solidarity with the entire workforce, according to financial circles. The initiative affects a few hundred managers and has nothing to do with securing liquidity or additional savings measures. In addition, the low double-digit million amount, which is according to information from the Handelsblatt, would also be modest.
In his speech at the Annual General Meeting, Sewing had made it clear that the corona crisis would hit the bank hard, so it was important to make the bank “storm-proof”. The bank wants to take countermeasures primarily on the expenditure side. The cost target of 19.5 billion euros for this year is still there or should even be undercut. Despite the pandemic, Sewing is also sticking to the other goals of the new strategy.
The bank had previously done well in an “unprecedented situation”, CEO announced at the virtual general meeting last Wednesday. “That is why we see no reason to cut back on our ambitions. We stand by our financial targets for 2022 as we announced them last year. ”
Among other things, the bank has undertaken to reduce its costs to an adjusted 17 billion euros, to increase earnings to 24 to 25 billion euros and to achieve an after-tax return of eight percent.
Can goals still be reached?
The analysts hear the message, but you lack faith. At best, they trust the bank to target costs, but not a single one believes the bank can still achieve its 2022 earnings or return targets.
On average, financial professionals expect earnings of EUR 22 billion and an after-tax return of 2.8 percent. For this year, capital market professionals predict a net loss of 1.8 billion euros – it would be the sixth year in a row.
And in view of these figures, how is the new empathy of the Sewing era received by employees? A German banker describes the executive’s waiver of wages as “a nice gesture that ultimately does not benefit anyone”.
More: US regulators criticize the lack of progress at Deutsche Bank