Now, more than ever, is the time to take action, the bank’s chief financial officer said Thursday.
“We want the focus to be on stabilizing the organization, moving quickly on the decisions we’ve made and giving clarity to clients in terms of where we are going to continue to participate and where we’ll step back,” CFO James von Moltke told CNBC’s Annette Weisbach in Frankfurt.
The bank on Thursday announced plans to significantly reduce its workforce through the rest of this year, following its report of 120 million euros ($146 million) in first quarter net profits — versus 575 million euros in the prior year period — and a 5 percent drop in revenues. Revenues for all businesses were lower year-on-year.
The workforce numbers are set to take a hit in the lender’s corporate and investment bank and infrastructure functions specifically, though von Moltke didn’t offer details in terms of headcount figures, saying it was still “early days.”
The bank also aims to scale back operations in bond sales and equities trading, particularly in the United States and Asia, where it was once bullish.
“The discipline here is in defining ourselves in relation to our European core, ensuring the discipline is there to be active in areas that are product strengths of ours,” the CFO said, stressing the need to focus on the bank’s connection with its home market of Germany and Europe.
“We’ll still participate in those markets, but it’s clearly a scaling back of our ambition we once had in markets like the U.S.”
The earnings report came amid a call for restructuring at the bank, where strategy is expected to shift from seeking profit growth through its loss-battered investment banking wing to a greater focus on the domestic German market, commercial and retail banking, and wealth management.
Von Moltke echoed some of the sentiments expressed Thursday morning by Deutsche Bank CEO Christian Sewing, who acknowledged that the current returns for shareholders were “unacceptable.”
“We’re acutely aware that its been a long-running restructuring story, and today’s announcements represent some additional restructuring,” he said. “At the end of the day, we have to define and defend the core perimeter for the company — we believe we have found that. The focus right now is on execution, making sure we move quickly to adjust the businesses to that core perimeter.”