Deutsche Bank boosts Jain in shakeup, investors object

* Deutsche Bank (Xetra: 514000 - news) reshuffles management board ahead of investor vote

* Overhaul sees co-CEO Jain tighten grip on strategy

* Co-CEO Fitschen cedes some responsibility to outgoing CFO

* Rainer Neske, retail chief and others to depart (Adds detail of shareholder vote, more comments)

By Thomas Atkins and Kathrin Jones

FRANKFURT, May 21 (Reuters) - Deutsche Bank boosted the power of co-chief executive Anshu Jain in a management shakeup, but shareholders criticised the moves as insufficient and demanded more changes to restore confidence in the leadership of Germany's largest bank.

The bank ousted some executives and re-arranged responsibilities among its top brass on the eve of its annual shareholder meeting, putting Jain in charge of a reorganisation and cost-cutting despite criticism of his performance.

The Indian-born former trader faces a symbolic vote of confidence at the annual meeting later on Thursday, along with the other management board members. But regardless of whether he wins or loses the non-binding vote, he is on borrowed time to prove he can boost Deutsche's earnings after failing to meet previous targets.

"Jain now has 12 to 18 months to deliver," said one top-20 shareholder.

Deutsche Bank has trailed rivals under the leadership of Jain and its other co-chief executive, Juergen Fitschen. Despite fallout from the financial crisis, they stuck to a costly universal banking model offering everything from mortgages in Germany to derivatives in London.

A restructuring plan unveiled last month to axe unprofitable business lines was judged too little, too late by some investors and to mollify them, the bank's supervisory board chairman Paul Achleitner moved late on Wednesday to revamp the management board.

This put Jain in charge of reducing the bank's costs by 4.7 billion euros, selling its Postbank retail business and paring back its investment bank. Now (NYSE: DNOW - news) it is clear who is in charge but also who is responsible if things don't go to plan.

A mover and shaker in financial capitals and an engaging speaker in private, Jain's inability to speak German means he often appears awkward at shareholder events, dominated by small- and sometimes vociferous investors.

He gave a long speech in English on Thursday but to meet German law, which requires that shareholder meetings are conducted fully in German, Jain's microphone was cut off to run a German voice-over, causing laughter from some audience members.

FITSCHEN

Jain landed the top spot at Deutsche in 2012 after the investment banking division he ran consistently delivered up to 85 percent of group profit and frequently outperformed peers.

But tougher regulatory requirements and litigation, including a $2.5 billion fine to settle allegations that Deutsche traders rigged benchmark interest rates, have taken the shine off a division often referred to internally as "Anshu's army".

Shareholder adviser Hermes Equity Ownership Services said on Thursday that Achleitner's rejig, unveiled during a supervisory board meeting on the 34th floor of Deutsche's Frankfurt headquarters on Wednesday night, had not gone far enough.

"We ask the supervisory board to further examine the construction of the management board and to pursue further changes," said Hans-Christoph Hirt, a director at Hermes.

Fitschen was hired as co-CEO to maintain the bank's German profile but his ability to sell the group's strategy to domestic shareholders has been impaired by his own legal problems.

He is required to appear every week at a criminal court in Munich to defend himself against allegations that he misled investigators in a dispute with the heirs of the Kirch media empire.

MORE RESPONSIBILITY FOR KRAUSE

Under the reshuffle, Fitschen ceded control of the division that is unwinding Deutsche Bank's unwanted assets to Stefan Krause, who orchestrated the bank's recent strategic review.

Krause, who is due to hand his chief financial officer title to fellow board member Marcus Schenck, has also been put in charge of overseeing the growing transaction banking division, an important part of the group's new strategy.

The bank will also seek to make Krause the supervisory board chairman of Postbank which it aims to reform before selling the unit by the end of 2016.

Deutsche Bank's shares have fallen over 6 percent since the new strategy was unveiled, underperforming a 1 percent rise in the STOXX index of European banks during that period.

"I think that management changes offering a clean record and fresh ideas would be required before we see any meaningful re-rating in the share price," said Guy de Blonay, manager of the Jupiter Financials Fund. "However, new management would require another capital increase and a significant clearing of the decks."

Under the revamp, Deutsche's retail banking boss, a senior executive in Asia and the head of the British business are all to leave the bank.

Rainer Neske will be replaced as head of retail by Christian Sewing, who is also responsible for legal matters.

Alan Cloete, the bank's co-chief executive officer of Asia Pacific, will also leave in the near future. Before running Asia, Cloete was global head of finance and foreign exchange operations, which was the business responsible for making price submissions that formed the basis for interest rate benchmarks such as Libor.

U.S. and British authorities imposed the $2.5 billion fine in April over allegations its traders tried to manipulate Libor.

Britain's Financial Conduct Authority said Deutsche Bank had repeatedly misled it during its inquiry. The head of the bank's UK operations, Colin Grassie, is leaving the bank.

(Additional reporting by Sinead Cruise; writing by Carmel Crimmins. Editing by Alexander Smith, Jane Merriman and David Stamp)