 "Anshu Jain quits Deutsche Bank; John Cryan named new CEO")
Germany's biggest lender, Deutsche Bank, appointed John Cryan as its new chief executive on Sunday, after co-CEOs Anshu Jain and Juergen Fitschen, resigned following criticism from investors.
Cryan, 54, has been on the bank's supervisory board since 2013 and was a former chief financial officer of UBS. He would replace Jain from July 1, and become the sole CEO after Fitschen steps down next year, the bank said.
Deutsche Bank has struggled to restore an image tarnished by a raft of regulatory and legal problems, including probes into alleged manipulation of benchmark interest rates, mis-selling of derivatives, tax evasion and money laundering.
It is one of the last large lenders in Europe to replace its top management since the financial crisis - after Barclays, Credit Suisse and UBS purged their top ranks to make way for fresh leaders.
In an effort to restore confidence in its leadership, the German lender had presented a radical management shake-up on May 21 but some investors had demanded more changes to restore confidence.
Cryan said there was work to be done. "Our future will be defined by how well we deliver on strategy, impress clients and reduce complexity. I look forward to beginning this work on July 1," he said in a Deutsche Bank statement announcing his appointment.
Supervisory board chairman Paul Achleitner said Cryan was the right person at the right time.
"John is not only a seasoned banker with extensive experience in financial matters but espouses the professional and personal values required to advance Deutsche Bank and Strategy 2020," he said.
The decision by Jain and Fitschen to step down demonstrated their commitment to putting the bank's interests ahead of their own, Achleitner said, praising their contributions.
Pressure
Jain landed the top spot at Deutsche Bank in 2012 after the investment banking division he ran consistently outperformed peers, and accounted for up to 85 per cent of the group's profit.
But tougher regulatory requirements and litigation, including a $2.5-billion fine to settle allegations that Deutsche Bank traders rigged benchmark interest rates, took the sheen off a division often referred to internally as "Anshu's army".
Making Jain directly responsible for cutting Deutsche Bank's costs by Euro 4.7 billion ($5.2 billion), selling its Postbank retail business and paring back its investment bank put huge pressure on the executive.
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.
Cryan will take power at an awkward time, after the bank's new strategic plan was roundly criticised by investors as too little too late.
He would now need to review the plan and decide how to implement it or whether an entirely different plan was needed, said Chris Wheeler, bank analyst at Atlantic Equities in London.
"If Cryan or someone else takes over, what do they do with that plan? A lot of detail is still needed on that. Does the new person say he wants to review it or say it's fine," Wheeler said. "It's still a massive job to do. It's one of the world's biggest investment banks and Germany's national champion."
Cryan, 54, has been on the bank's supervisory board since 2013 and was a former chief financial officer of UBS. He would replace Jain from July 1, and become the sole CEO after Fitschen steps down next year, the bank said.
Deutsche Bank has struggled to restore an image tarnished by a raft of regulatory and legal problems, including probes into alleged manipulation of benchmark interest rates, mis-selling of derivatives, tax evasion and money laundering.
It is one of the last large lenders in Europe to replace its top management since the financial crisis - after Barclays, Credit Suisse and UBS purged their top ranks to make way for fresh leaders.
In an effort to restore confidence in its leadership, the German lender had presented a radical management shake-up on May 21 but some investors had demanded more changes to restore confidence.
Cryan said there was work to be done. "Our future will be defined by how well we deliver on strategy, impress clients and reduce complexity. I look forward to beginning this work on July 1," he said in a Deutsche Bank statement announcing his appointment.
Supervisory board chairman Paul Achleitner said Cryan was the right person at the right time.
"John is not only a seasoned banker with extensive experience in financial matters but espouses the professional and personal values required to advance Deutsche Bank and Strategy 2020," he said.
The decision by Jain and Fitschen to step down demonstrated their commitment to putting the bank's interests ahead of their own, Achleitner said, praising their contributions.
Pressure
Jain landed the top spot at Deutsche Bank in 2012 after the investment banking division he ran consistently outperformed peers, and accounted for up to 85 per cent of the group's profit.
But tougher regulatory requirements and litigation, including a $2.5-billion fine to settle allegations that Deutsche Bank traders rigged benchmark interest rates, took the sheen off a division often referred to internally as "Anshu's army".
Making Jain directly responsible for cutting Deutsche Bank's costs by Euro 4.7 billion ($5.2 billion), selling its Postbank retail business and paring back its investment bank put huge pressure on the executive.
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.
Cryan will take power at an awkward time, after the bank's new strategic plan was roundly criticised by investors as too little too late.
He would now need to review the plan and decide how to implement it or whether an entirely different plan was needed, said Chris Wheeler, bank analyst at Atlantic Equities in London.
"If Cryan or someone else takes over, what do they do with that plan? A lot of detail is still needed on that. Does the new person say he wants to review it or say it's fine," Wheeler said. "It's still a massive job to do. It's one of the world's biggest investment banks and Germany's national champion."