Deutsche Bank's biggest strategic overhaul under co-chief executives Anshu Jain and Juergen Fitschen has been given the thumbs down from investors. As Hayley Platt reports the 200 billion euro cuts in investment bank assets are being judged as too little too late.
Deutschebank's joint CEO's have taken four months to come up with a plan - and it was a big one. Anshu Jain and Juergen Fitschen will cut up to 150 billion euros in investment bank assets. They'll also exit a tenth of the countries they operate in. And spin off the retail division Postbank through a share offering. Up to 200 branches will close by 2017 - that's more than a quarter of Deutsche's retail network. Fitschen says he wants to simplify operations while meeting new regulatory requirements. (SOUNDBITE) (German) DEUTSCHE BANK CO-CHIEF EXECUTIVE OFFICER, JUERGEN FITSCHEN, SAYING: "At the centre of what we are calling the 2020 strategy is our ambition to create values for our shareholders, our clients, for all stakeholders." But investors judged the plan as too little too late. They say Germany's flagship lender stuck to an expensive universal banking model while rivals like UBS and Barclays implemented reforms. Jain apologised for not moving faster but shares initially fell almost 6 percent. Robert Halver is from Baader Bank. (SOUNDBITE) (German) CAPITAL MARKET ANALYST FROM BAADER BANK, ROBERT HALVER, SAYING (ON DEUTSCHE BANK): "Deutsche Bank is being caught by stricter and stricter banking regulations so they must reduce costs. Their large number of branches, also at Postbank, is no longer affordable. It's too expensive and that's a general trend." The plan will see the bank take a one-off hit of 3.7 billion euros. That, after last week's $2.5 billion fine for manipulating interest rate benchmarks caused earnings to fall by half in the first quarter. SOUNDBITE) (English) DEUTSCHE BANK CO-CHIEF EXECUTIVE OFFICER, ANSHU JAIN, SAYING: "We take all the findings of our regulators, which we accept, completely very seriously. We've already terminated everyone who was directly involved with the actual manipulation itself. We are waiting for the entire regulatory process to come to an end. As soon as that's done, the board is resolved and Juergen is going to run an overall process to review lessons learned." Germany's flagship lender is promising a progress report in 90 days. But Fitschen has another problem to deal with before then. He and several former executives are due to stand trial this week in connection with the collapse of the Kirch media group.