Deutsche Bank AG will offer 8 billion euros (USD8.5 billion) of stock, sell part of its asset management business and named two deputies to Chief Executive Officer John Cryan as Germany’s largest lender seeks to shore up capital after two consecutive years of losses.
The bank said it will keep its Postbank consumer division and still aims to reduce total costs to 22 billion euros by 2018, the Frankfurt-based company said in a statement Sunday. Chief Financial Officer Marcus Schenck, 51, and Christian Sewing, who oversees wealth management and consumer banking, will become co-deputy CEOs. The company will find a new CFO “in due course.”
The measures mark a reversal for Cryan, 56, who had unsuccessfully sought to sell Postbank to avoid tapping shareholders for extra cash. Deutsche Bank has posted more than 8 billion euros of net losses in the past two years as Cryan, who took over in 2015, settled misconduct investigations and scaled back capital-intensive debt-trading businesses.
“A strong capital base is essential if we’re to succeed in charting this strategy,” Cryan wrote in a letter to employees. The share sale will “remove a major source of uncertainty. That should make us significantly more attractive for our clients.”
The lender said it will sell a minority stake in its asset management unit through an initial public offering in the next two years. That, along with asset disposals at the investment bank, will help raise another 2 billion euros of capital. The bank will propose a dividend in May of 0.19 euros per share. Bloomberg
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