Problems from the past continue to haunt Deutsche Bank. In addition to several thousand legal actions pending against Germany’s biggest bank, there will be another court case at the end of April.
Co-chief executive Jürgen Fitschen and four former bank managers are accused of having given misleading testimonies involving the bankruptcy of the Kirch media empire, a pioneer of paid TV in Germany. However the trial goes, it will not only damage the bank, but also the reputation of one of Germany’s most powerful bankers.
The Deutsche Bank case comes at an inopportune moment. In coming weeks, Mr. Fitschen and co-chief executive Anshu Jain will present the bank's new strategy. Their plan for the future is expected to address the challenges of stricter regulation and bring the renowned financial institution back to its successful path of former years.
Mr. Fitschen is credited with countering the bank’s many financial scandals with a fundamental change in culture.
But how can the bank credibly promote its new business model if one of its leaders has to explain himself in court?
Up to now, Mr. Fitschen has been seen as an honorable banker. The trust the business community placed in Deutsche Bank is closely linked to Mr. Fitschen, the person. In nearly three decades at the bank, he had not been connected with one single scandal.
The biggest legal disputes, such as charges that Deutsche Bank manipulated the benchmark Libor interest rate, mostly have come from the investment banking side, for which Mr. Jain is responsible. Mr. Fitschen was seen as a stabilizing force in the dual leadership, who could be relied upon even in the toughest times.
Mr. Fitschen is therefore highly thought-of, and not just in Berlin’s political circles. The bank’s employees also value his integrity. He is credited with countering the bank’s many financial scandals with a fundamental change in culture. That change was needed and it must be rigorously continued, regardless of the current case.