On Wednesday, John Cryan, who is the incoming co-Chief Executive of Deutsche Bank AG, announced that he would be postponing a detailed strategy presentation until the end of October.
This presentation is expected to cover the German lending giant’s new strategy and despite this delay, Cryan made it quite clear that he is still committed to cutting the operations at Deutsche Bank.
The co-Chief Executive posted a letter to his staff on the bank’s website where he made it clear that over the next few months, things are not going to be filled with “sweetness and light”. This made it quite evident that the bank is likely to make staff cuts over the coming months while shifting their focus on changing the corporate culture in the company.
Cryan used to be the finance chief at UBS and he took his position as co-CEO at Deutsche Bank from the 1st of July, working alongside Jürgen Fitschen.
Last month, as reported by The Wall Street Journal, Anshu Jain stepped down as co-CEO and Cryan has now stepped into his shoes. At the time, it was reported that Jain stepped down as a result of intense criticism from both investors and regulators.
Cryan made his intentions clear on his first day on the job and this includes his commitment to building the foundations of the strategy 2020. This strategy includes shedding Deutsche Bank’s Postbank AG retail banking business. Cryan did however make it quite clear that he would take his time to assess how he could cut costs and how he can implement the new strategy effectively. Based on this, his presentation has been delayed until the end of October.
Since the middle of 2012, when Mr. Fitschen and Mr. Jain took over the reins at Deutsche Bank, there has been a clear decline in terms of share price and profitability, especially compared to its rivals. Added to this, the bank has attempted to lower costs while being hit with a series of costly lawsuits which has cost the bank over $10 billion in the last 3 years.
The fact is John Cryan has a reputation for cutting costs and during his time at UPS, he was instrumental in bringing down operating costs from 28.6 billion Swiss francs in 2008 to 22.4 billion Swiss francs ($23.8 billion) in 2011. The question is can Cryan do the same for Deutsche Bank? The shares of Deutsche Bank are currently trading at $28.28 a share.
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