Job cut at Deutsche Bank: Germany's biggest lender to slash 3,500 jobs as ‘cost discipline remains a high priority’

Deutsche Bank is going to cut 3,500 jobs within the next two years. This move comes from Germany's largest financial institution amid a strategic cost-reduction initiative. As this news broke, the bank's share prices went up by nearly 5%.

The lender’s net earnings witnessed a decline of 16% at 4.2 billion euros ( ₹37,684 crore) in 2023. Christian Sewing, the Chief Executive Officer (CEO), acknowledged the need for cost management.

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"Cost discipline remains a high priority," AFP quoted the CEO as saying in a message to Deutsche staff while praising the company’s performance amid "an uncertain environment". The lender is pressing ahead with a 2.5-billion-euro ( ₹22,430-crore) efficiency push aimed at improving profitability. Sewing also noted a pre-tax profit of nearly 5.7 billion euros, a peak in 16 years.

Deutsche Bank's operational expenses in 2023 included those on restructuring and severance. It amounted to 566 million euros ( ₹5,078 crore). This financial manoeuvring is part of a savings and efficiency programme initiated in 2019.

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The bank saw a revenue surge of 6%, reaching 28.9 billion euros ( ₹2,59,298 crore). This uptick is largely attributed to the higher interest rates sanctioned by the European Central Bank.

The bank expects to spend nearly 400 million euros ( ₹3,588 crore) in 2024, CFO James von Moltke said in a press conference. The expenses would include restructuring costs and further severance packages, von Moltke added.

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Plans for 2025

Deutsche Bank has laid out ambitious plans for 2025. Those include getting revenues of 32 billion euros ( ₹2,87,084 crore). It plans to maintain total operational costs at around 20 billion euros ( ₹1,79,428 crore). The bank also intends to propose dividends of 0.45 euros per share for 2023, marking a 50% increment from the previous year.

"Our ambition is to be able to pay a dividend of one euro per share for the financial year 2025," Sewing said.

(With AFP inputs)