By PYMNTS | January 30, 2025
Deutsche Bank plans to continue cutting costs by reducing headcount, adding technology and possibly closing business units, executives said Thursday (Jan. 30).
“We are determined to make this bank more efficient, and that means changing how we do things,” Deutsche Bank CEO Christian Sewing said in prepared remarks for a fourth-quarter earnings call with analysts Thursday (Jan. 30). “It starts with a simpler organizational setup and a smaller workforce. And it requires us to become even more technology-driven, which will also enhance client experience.”
The bank aims for a year-over-year increase in revenues of 2 billion euros (about $2.1 billion) while keeping its adjusted costs flat, Sewing said. It has already realized 1.67 billion euros in savings, in part by removing 3,500 roles, most of which were non-client-facing roles in high-cost locations.
While cutting these roles, the bank also added employees in roles having to do with technology, controls and revenue generation, he said.
“In 2024, we hired 1,300 technology specialists and added 400 targeted revenue-generating roles, supporting long-term cost improvement and growth,” Sewing said.
In its Personal Banking division, Deutsche Bank continues to pursue a “major efficiency transformation” that it began in 2021 and includes a review of its service model and branch footprint, he said. It has closed 400 branches since 2021, including 125 branches in 2024.
The bank said in September that while closing a “mid-double-digit” number of smaller branches in Germany, it was also adding new formats and technologies. It said it would increase its capacity to advise via video and telephone, further invest in its app and other digitization, and add more private banking centers, modern ATMs and community events to its branches.
Sewing said in Thursday’s prepared remarks: “Profitability and higher returns, especially in German Personal Banking, will remain top priorities, and we expect to deliver them via further streamlining of our branch network and the modernization of both our brands while leveraging the synergies from our unified IT environment.”
Deutsche Bank also plans to improve the profitability of its lower-return businesses by making efficiency improvements or by exiting those businesses, he said.
“We have already started these reviews in some lending portfolios, such as mortgages, and are seeing benefits of these choices,” Sewing said.
