Deutsche Bank Axes 15,000 Jobs After £4.4bn Loss

Deutsche Bank (Other OTC: DBAGF - news) is slashing 15,000 posts after tumbling to a record €6.1bn (£4.4bn) loss for the third quarter as it took a hit from major financial write-offs and money set aside to deal with litigation.

Germany’s biggest lender will also shrink its workforce by selling operations with a further 20,000 workers.

The bank, which has been engulfed in scandals including foreign exchange manipulation and Libor rate-rigging, is undergoing a major reorganisation under new chief executive John Cryan.

It (Other OTC: ITGL - news) said it was axing 9,000 full-time equivalent positions - 4,000 of them in Germany - as well as 6,000 external contractor jobs.

Deutsche will close some branches and pull out of 10 countries – Argentina, Chile, Mexico, Peru, Uruguay, Denmark, Finland, Norway, Malta and New Zealand.

The bank employs just under 100,000 staff worldwide and around 8,000 in London, but it would not say if its UK workers would be hit by the job losses.

It came as the bank plunged into the red for the third quarter after taking a €5.8bn (£4.2bn) write-off on the value of its investment bank and retail subsidiary Postbank.

The bank has also set aside an additional €1.2bn (£860m) to deal with a slew of legal cases.

Mr Cryan said it was "a highly disappointing result" after the bank warned of the likely hit earlier this month. Shares (Berlin: DI6.BE - news) fell 6%.

Deutsche said its strategic review was expected to produce savings of €3.8bn (£2.7bn).

Mr Cryan said the bank aimed to become simpler and more efficient, less risky, better capitalised and run with better discipline "and a reward system which is aligned to good performance and conduct".

He added: "Sadly, this also means closing some of our branches and country locations, and reducing some of our front-office and infrastructure staff too. This is never an easy task, and we will not do so lightly."

Mr Cryan also warned that their would be "consequences on compensation" when asked whether executive bonuses might be hit, but said that he could not yet quantify this (Other OTC: UBGXF - news) .