Deutsche Bank took the axe to its Asian investment bank less than 12 months ago, but this year the firm is likely to make further front-office layoffs in Singapore and Hong Kong, if a merger with Commerzbank goes ahead.
In 2018, Deutsche’s Asian headcount fell by 1,200 year-on-year to reach 19,700, and the redundancies weren’t only in the back-office. James McMurdo, head of Deutsche’s corporate and investment bank for Asia Pacific, made job cuts in mid-2018, and almost 50 senior investment bankers left Deutsche in Hong Kong and Singapore last year.
Although McMurdo said in August that the cuts were almost over, this is unlikely to now be the case. If the Commerzbank merger takes place, IB jobs at Deutsche in Asia appear under threat. As Bloomberg points out, neither bank has a retail business in Asia (aside from DB in India), which means their regional operations are expensive and are likely to come under scrutiny if a combined firm is looking to save costs. Ominously, Deutsche is now reportedly considering vacating up to three of the 10 floors it leases in Hong Kong’s International Commerce Centre.
Some Deutsche Bankers agree that jobs are in jeopardy. “I know for a fact that quite a number of my colleagues have been actively searching for jobs during the past few months,” says a banker at the firm in Singapore.
Meanwhile, recruiters in Singapore and Hong Kong have noticed an increase in enquires from IB employees at the German firm since merger talk gathered pace last month. “I’m getting plenty of approaches – [Deutsche] people are looking to get out of the bank as fast as possible,” a front-office headhunter in Singapore told us. “The issue is not just that bonuses were bad again, but also that they feel there’s no light at the end of the tunnel for Deutsche’s investment bank.”
“In Asia, recent departures and potential departures at Deutsche are all from the IB side,” says another Singapore headhunter. “And as a recruiter, placing a candidate into a job at DB’s investment bank is now a non-starter. I can’t in good conscience recommend it,” he adds.
Deutsche Bank ranked outside the top-10 for Asia (ex-Japan) revenue in M&A, ECM and DCM for the first quarter, according to Dealogic.
There are some bright spots for the firm in Asia, however. It placed third for 2018 APAC fixed income, currencies and commodities (FICC) revenues, according to Coalition data. And DB is unlikley to ever pull out of Asia, even if the merger goes ahead. CEO Christian Sewing told staff at a townhall meeting in Singapore last year that the bank’s business in Asia remains key to its global success.
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