Tough economic reality is evident everywhere as the Germany biggest financial institution, Deutsche Bank has said it will cut 15,000 jobs because of the third-quarter €6bn (£4.3bn) loss.
According to bbc.com the Germany’s biggest bank said it would cut 9,000 full-time jobs and 6,000 contractor roles.
It is also planning to sell businesses employing 20,000 people over the next two years.
By 2018, “we expect to see the benefits of our hard work and potentially be in the midst of a powerful turn-around,” said John Cryan, co-chief executive.
The cuts represent just less than 15per cent of the firm’s total workforce. The bank’s shares fell 5.5% in Frankfurt trading.
Deutsche is trying to cut €3.8bn of annual costs as European banks struggle with sluggish economic growth in their home markets and stricter regulation.
Cuts in Germany
In times of low growth, reducing costs through job cuts is seen as a way to improve profits.
The bbc.com also reported that the bank is planning to spin off Postbank with a stock market listing and sell its 20per cent stake in China’s Hua Xia Bank.
It has also said it will stop dividend payments for 2015 and 2016.
Mr Cryan told a news conference that the bank faced “hard decisions” as it was restructured. “We must reduce Deutsche Bank’s complexity,” he added.
The bank said it would close businesses in Malta, Argentina, Chile, Mexico, Finland, Peru, Uruguay, Denmark, Norway, and New Zealand. Some branches in Germany would close as well, Cryan said.
The third-quarter loss was caused by more than €5.8bn of charges in writedowns and legal expenses at its investment bank and on assets it wants to sell, as well as higher litigation charges.
Of the 9,000 full-time job cuts, about 4,000 will take place in Germany.
The lender employed 98,000 people as of the end of last year, according to its annual report.