Deutsche Bank on the rise again

AS IT emerges from years dogged by scandal, Germany’s biggest lender Deutsche Bank aims to up profitability and reclaim a place on the global stage to rival giant US competitors.

But the bank warns profits will never again reach the risk-fuelled heights of the prefinancial crisis era as it grinds through a deep restructuring, adjusts to new rules and adds thousands of jobs in regulatory compliance.

Deutsche “absolutely does not want to take unconsidered risks as it did in the past” as it girds itself to reconquer what it can of the lost ground, compliance chief Sylvie Matherat said.

Its newfound strictness about financial regulation means the bank was on track to restore confidence among clients, she said.

Already, this autumn has been far calmer for the Frankfurt-based group than last year’s.

Back then, the US Department of Justice slapped it with a $14.2-billion (R196-billion) fine demand over its role in the subprime mortgage crisis, the trigger for the 2008-09 financial crisis.

Unlike US competitors, Deutsche was slow to react to the financial crisis, and should have begun cleaning up its balance sheet earlier, said former Bank of France regulation chief Matherat, who joined Deutsche in 2014.

British chief executive John Cryan has chosen a path of reducing risks in its investment banking division, closing 200 branches across Germany and slashing 9 000 jobs worldwide.

Even once those mammoth tasks are ticked off, returning to pre-crisis levels of profitability isn’t possible, warned Matherat. — AFP