No one can accuse John Cryan, the new chief executive of Deutsche Bank, of beating around the bush.
“I won’t tell you that everything will be harmonious and without problems in the coming months,” he wrote in an introductory letter to the Frankfurt-based bank’s 100,000 employees, seen by Handelsblatt.
Mr. Cryan clearly intends to take an unflinching approach toward his new job, which he began on Wednesday. But Deutsche Bank staff must have known what they faced after the abrupt departure of ex-CEO Anshu Jain: restructuring, cost-cutting and job losses.
Unlike Mr. Jain, who was a star investment banker before becoming co-CEO of Deutsche Bank in 2012, Mr. Cryan is known as a no-holds-barred restructuring expert who cut his cloth as a banking consultant rather than a high-profile trader. He is now charged with turning around the fortunes of a bank that has struggled since the 2008 financial crisis under a wave of damaging lawsuits and fines, an unprofitable retail business and demands from regulators to reduce risk-taking in its investment banking unit.
The letter suggests Mr. Cryan doesn’t any have a problem dismantling Mr. Jain’s legacy: On his first day, the 54-year-old British citizen announced deep cuts to Deutsche Bank’s securities trading business – a key part of the investment banking division where Mr. Jain initially made his name.
Trading will no longer be allowed to burn up so much of the bank’s capital reserves. “We cannot afford ourselves this luxury,” Mr. Cryan wrote. “If we reduce this dependency, there shouldn’t be any competitive disadvantage, since the market is already moving in this direction.”
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