Deutsche Bank CEO Christian Sying plans to cut as many as 20,000 jobs across the company next year, according to non-named sources. The cuts are likely to fall into the stock and trading departments, and represent one of six full-time employees.
The cuts represent the next step of "trimming the barrel" that began last year, when Sying began to "tough down" to make the bank more profitable. The bank's stock rose almost 5% in early trading on Friday when the news reached investors hoping for some positive changes.
Change of bank?
Deutsche Bank cuts represent a sharply changing banking model for global giants. The CEO has apparently made plans to eliminate the trading department head Garth Ritchie, as well as the company's chief financial officer, James von Moltke.
Deutsche Bank had previously placed great emphasis on stocks and investment trading, but has outlined plans to move away from these fields. Instead, Deutsche Bank will focus on, among other things, the transaction bank, corporate financing and foreign exchange trading. The shift would increase the bank's profit margins by focusing on more profitable sectors.
The announcement comes as other major banks have made similar restructuring movements, with JPMorgan announcing its own internal crypto course, and Citigroup proposes layoffs. The changing face of economics with technological implications has made the largest brick and mortar bank some of the dinosaur.
Deutsche Bank also confirmed its commitment to customers in the US and AsiaPac marketplaces. However, the international nature of banking services changes the way companies and individuals transfer overseas.
Recent announcements from TransferWise and Facebook regarding international payment systems have shown a need for consumers for fast and cheap alternatives. The weak scholarship methods for international transfer simply do not provide the speed needed for modern business activities.
Deutsche Bank's lack of alignment over the past decade has haunted the new management. Sewing, which took the helm in April last year, has had the frightening job of bringing the company forward ten years in just one.
Even when business solutions are being tried, cryptocurrency options are already available to the market. Ripple's XRP has been proposed as a more centralized system, and Bitcoin is already used for individual international transactions.
Of course, with cryptographic baskets like Bitcoin or Ethereum, trading platforms offer international investors full freedom to buy or sell. But with other central banks, some governments have banned ownership or trade for non-accredited investors.
As older banking institutions like Deutsche Bank are trying to get started with finance and technology, they believe the cryptocurrency faithfully that they are already well ahead of the curve. The future of banks may well be on blockchain.
Think the latest cuts by Deutsche Bank will be enough to limit the bleeding, or will the bank be forced to make further cuts to survive? Please let us know in the comments below!
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