Christian Sewing is doing a lot of traveling and explaining. The new boss of Deutsche Bank is seeking to boost morale among its 97,000 worldwide staff, some of whom will surely be weighing up career opportunities elsewhere.
Since Mr. Sewing’s promotion to the top job last month, Handelsblatt has had dozens of conversations with Deutsche staff worldwide. The picture that emerges is of an increasingly anxious workforce. The mood is said to vary by division: Staff in retail banking are upbeat, possibly because they feel safer as Mr. Sewing used to run that business. By contrast, morale is sagging among investment bankers, who complain the lender lacks a clear strategy.
A couple of weeks ago, Mr. Sewing and his deputies presided over a town hall meeting on Wall Street intended to reassure the bank’s New York staff that they still had a bright future with Deutsche. Many employees, however, are skeptical after three years of losses and three CEOs in six years. The new boss has outlined his strategic vision for Europe’s largest bank, but it remains painfully short on detail.
In any struggling firm, uncertainty can prove more toxic than even poor results. At Deutsche, Germany’s largest bank, a crisis in confidence has prompted some employees to head for the exits. Last year, staff turnover reached its highest level since 2010.
You get the feeling that the bank isn’t moving forward and your career prospects are limited. Deutsche Bank employee
Beleaguered executives are doing everything they can to prevent an exodus. Since Mr. Sewing took over from John Cryan a little over a month ago, top managers have addressed more than a dozen large staff meetings like the one in New York. More than 25 emails have gone out to staff, seeking to clarify the situation.
Mr. Sewing starts with a surprising amount of goodwill among the workforce, especially in Germany. The former head of Deutsche’s retail banking is seen as a steady pair of hands, having been with the bank almost exclusively since arriving as a teenage trainee in 1989.
Retail banking is often regarded as a dull sibling of investment banking, whose flashy dealmakers and traders of sophisticated financial instruments tend to see themselves as the rock stars of finance. Noted for his down-to-earth management style, Mr. Sewing more easily fits the staid retail mold, even though he used to run risk management at Deutsche in London, as he likes to point out. He knows he cannot afford to alienate its investment bankers who, despite a catalog of problems including crippling costs, billion-euro fines levied by regulators and creaking IT, still generate the bulk of the lender’s earnings.
Ten years ago, Deutsche Bank was a powerhouse ... that is simply not the case now. Paul Webster, North America boss of headhunters Page Executive
At Deutsche’s US operations, the mood is particularly grim. It is widely believed that the bank will make cuts to its American trading businesses; in the meantime, its more profitable competitors are looking to pick off the best staff.
With nerves on edge, the bank is trying to stop the rot. On Wednesday, it publicly denied a Bloomberg report which claimed 20 percent of US staff faced the axe. The US corporate finance division has announced the closure of its energy team, costing 70 jobs worldwide, but it has also confirmed seven teams which would be unaffected by the changes.
In London, the prospect of Brexit adds another layer of uncertainty, with local staff expecting sweeping job cuts. Even in Germany, where its employees are more loyal, younger recruits are increasingly regarded as poachable. “You get the feeling that the bank isn’t moving forward and your career prospects are limited,” says one former employee.
Keeping younger staff is all the more important since Deutsche finds it increasingly difficult to attract talent from competitors. “Ten years ago, Deutsche Bank was a powerhouse in London and by far the biggest European bank in New York," said Paul Webster, North America boss of Page Executive, a headhunting firm. "That is simply not the case now.”
Yasmin Osman is a financial editor with Handelsblatt's banking team in Frankfurt. Astrid Dörner and Carsten Volkery are correspondents in New York and London respectively. Jeremy Gray contributed to this story. Brían Hanrahan adapted it into English for Handelsblatt Global. To contact the authors: [email protected], [email protected], [email protected]