Deutsche Bank to cut costs
Deutsche Bank, Europe's biggest bank by assets, will cut costs by €4.5 billion and review pay practices to boost profitability amid higher capital requirements and Europe's debt crisis.
Deutsche Bank will seek to increase its after-tax return on equity to at least 12 per cent by 2015, the Frankfurt-based lender said in a statement today, from 8.2 per cent in 2011.
The company will incur €4 billion of costs to achieve its annual savings target by 2015 and plans to eliminate more jobs.
"The medium-term economic recovery and regulatory outlook is challenging, hence we need to significantly improve our operating performance and efficiency," co-chief executive officers Anshu Jain and Juergen Fitschen said in the statement.
"It is not enough to adapt our strategy to customers' changing demands; we also have to secure our competitiveness."
The bank said it will extend the period for deferred bonus payouts to senior management and appoint an external committee to review compensation.
Investment banks are fighting to buoy profits as record-low interest rates and a drop in trading and deal-making curb revenue.
Deutsche Bank rose 1.7 per cent €32.38 by 1.28pm in Frankfurt trading, bringing the gain this year to 9.9 per cent.