Germany’s biggest bank has cut ties with clients that cost more to service than they bring in returns as part of efforts to boost its capital.
Deutsche Bank Chief Executive John Cryan is stepping up the restructuring process as the bank finalizes talks with U.S. justice authorities over a multi-billion dollar fine related to U.S. mortgages.
At a strategy presentation in October 2015, Cryan had said that Deutsche Bank would reduce the number of clients in its Global Markets and Corporate & Investment Banking divisions by about 50 per cent.
“We expect to off-board about half of the current list of clients as the economic returns in these relationships are inadequate to us,” he said at the time. He also said that 80 per cent of the investment bank’s income came from 30 per cent of clients.
Deutsche Bank is still among the top 5 trading houses in debt and top 10 in equities globally, according to research firm Coalition. But the bank has lost market share as it retreats from a period of expansion, in which it had focused mainly on revenue growth and less on profitability.
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