Deutsche Bank employees in NY have started showing up for work not knowing if their jobs are safe after the German investment bank began implementing 18,000 job cuts across the globe, prompting shares to plunge nearly seven percent.
Shares in Deutsche Bank opened up more than three per cent in Frankfurt to reach their highest value since May 2.
The bank's supervisory board met today to agree the proposed changes, one of the biggest shake-ups in the industry since the financial crisis. The staffer said he and his colleagues had known the impending cuts were likely for the past couple of weeks.
Teams of share traders in Tokyo and other offices in Asia were told on Monday that their jobs were going. During one-to-one meetings with management and human resources, they were told they were being laid off and informed of their severance terms, the sources said.
Sewing added: "This is a restart for Deutsche Bank..."
"People have been planning their next moves but it's a tough market", the person said, speaking on condition of anonymity.
However, the bank's shareholders should again forgo a dividend for the years 2019 and 2020.
The investment bank is the focus of the overhaul.
'I am very much aware that in rebuilding our bank, we are making deep cuts. However, it has struggled to compete with USA rivals, hampered by regulatory investigations and litigation. However, some shareholders have pushed for a full US retreat.
In addition to its struggles in the equities and fixed income markets, Deutsche has also incurred heavy fines for misconduct, failed United States stress tests and has most recently been served with subpoenas from USA senators over its past dealings with Donald Trump.
Chief executive Christian Sewing declined to give a breakdown of where the jobs axe would fall, but insisted that London would remain a "critical part" of its plans.
Deutsche Bank has announced swingeing job cuts as part of a radical overhaul of its operations that will also see it spend €13bn on new technology over the next four years.
The nearby Balls Brothers pub filled up with laid-off staff.
Deutsche Bank boss Sewing, 49, told journalists: 'We tried to compete in almost every corner of the banking market at the same time.
JP Morgan analysts called the plan "bold and for the first time not half-baked" but questioned the credibility of the execution, revenue growth and employee motivation. Moody's Investors Service affirmed its ratings on Deutsche Bank on Monday and kept a negative outlook.
"Our ECM business has to be scaled back but it's not like everything will happen in one day", he said.
One of Deutsche Bank's biggest problems has been its antiquated technology infrastructure.
It is also creating a new unit to manage assets that belong to businesses it no longer wants.
Restructuring by 2022, workforce cut by about 18,000 employees, to roughly 74,000. But the person also said most of its mergers and acquisitions (M&A) team was not immediately affected. So far this year, it ranks 8th regionally for M&As. "In refocusing the bank around our clients, we are returning to our roots and to what once made us one of the leading banks in the world", he said.
Staff leaving in Hong Kong were holding envelopes with the bank's logo.
"The equities market is not that great so I may not find a similar job, but I have to deal with it", said another.