Deutsche’s von Moltke on how he learned to stop worrying and love the cuts
The Deutsche Bank CFO is adamant that not only are his bank’s new ambitions achievable despite a fragile environment, but clients are also supportive.
Life for Deutsche Bank CFO James von Moltke at the moment means having to spend a lot of time defending his bank’s latest restructuring plans.
After firing off a long letter in August to refute assertions made in an opinion piece that appeared in American Banker, his ‘fireside chat’ at September’s Barclays global financial services conference had to cover similar ground.
CEO Christian Sewing announced in early July that the bank would exit most of global equities, including transferring its prime finance and electronic equities franchise to BNP Paribas, for which a master transaction agreement was announced on September 23.
It is retaining what it describes as a “focused” equity capital markets capability. It is shrinking its rates business.
It is also setting up a new corporate bank division that combines its global transaction banking business and parts of its commercial bank, and plans to make this the driving force of the restructured firm.
Risk-weighted assets (RWAs) and leverage exposure related to the businesses it is exiting have been transferred into a capital release unit (CRU), which is being wound down over the next few years.
First up in the Barclays discussion was the issue of how sensitive Deutsche’s plans are to any downturn.