Deutsche Bank has appointed a new chief executive and is hinting at changing the way its investment banking business works, according to an April 8 announcement from the firm.
Christian Sewing, most recently president of Deutsche Bank’s private and commercial banks, has been appointed as CEO, replacing John Cryan, who had been at the helm since July 2015.
The news comes after the German bank had a particularly tough fourth quarter of 2017, reporting a net loss of €2.2 billion ($2.75 billion).
“Setbacks like in the fourth quarter of 2017 are not to be repeated under any circumstances,” Sewing wrote in his message to employees that was subsequently published on the bank’s website on April 9. “Each division and each of us has to internalise this.”
Sewing noted in his message that Deutsche Bank that he plans to work on growth in the company’s business divisions and infrastructure functions. Sewing also said that the bank’s operating costs in 2018 must not exceed €2.3 billion, something that for him is “non-negotiable.”
“It does not need saying that we want to and have to become profitable again,” he wrote. “And for that we need to be successful, that’s our lifeline.” Sewing said Deutsche Bank will be “thoroughly” analyzing its corporate and investment banking division, to further adapt its revenue, costs, and capital structure. This could include downsizing, or in Sewing’s words, “pulling back from those areas where we are not sufficiently profitable.”
Sewing’s focus, in essence, will be ensuring that Deutsche Bank avoids having that fourth quarter of 2017 again. “The new leadership team will not accept this anymore,” he wrote. “We’ll have to take tough decisions and execute them.”
Sewing has worked for Deutsche Bank since 1989, when he started as an apprentice. Since joining the firm that year, he has worked in its offices in Frankfurt, Hamburg, London, Singapore, Tokyo, and Toronto, according to Deutsche Banks’ announcement.
In addition to Sewing’s appointment, Deutsche Bank has named Garth Ritchie and Karl von Rohr as new presidents. Ritchie will lead the corporate and investment bank division, having previously co-headed the unit with Marcus Schenck. Schenck announced plans to leave Deutsche Bank after Easter during the appointment process, according to the firm.
Deutsche Bank’s private and commercial bank division will be lead by Frank Strauß, who previously co-headed the group with Sewing.
Cryan will leave at the end of April, the bank said. It is unclear what his next moves will be.
Deutsche Bank declined further comment on the news.