BERLIN, April 9 (Xinhua) -- Christian Sewing, the new chief executive officer (CEO) of Deutsche Bank, announced further cost cutting measures at Germany's largest financial institute on Monday.
"We are aware that we must continue to make changes with regards to our earnings-, cost- and capital structure", a letter by Sewing to Deutsche Bank's circa 100,000 staff read. The CEO said that he would "make and implement difficult decisions under his tenure", such as closing units which failed to meet profitability targets.
"Setbacks like in the fourth quarter of 2017 cannot be repeated under any circumstances", Sewing warned with reference to a recent unexpected spike in losses. The incident which ultimately toppled ex-CEO John Cryan followed a series of international scandals surrounding diverse allegations of fraud which have harmed the bank's reputation and profitability.
The 47-year-old Sewing has been working at Deutsche Bank since his teenage years and will take over from Cryan with immediate effect after an emergency meeting by the lender's supervisory board on Sunday night.
Earlier, media reports had cited insider information that board chairman Paul Achleitner was poised to terminate Cryan's five-year contract as CEO pre-maturely because the relationship between the two individuals had "broken down" over a lack of progress in corporate re-structuring efforts.
News of the personnel change was greeted warmly by the financial markets, with Deutsche Bank's share price rising by up to 4 percent in Monday trading.
Sewing urged employees in his internal letter to rediscover their "hunter mentality" and argued that the bank needed to aim higher than merely "solid performance" in order to persist a difficult market environment.
Achleitner told press that he was convinced that the newly-appointed CEO would "successfully lead Deutsche Bank into a new epoch." However, analysts also criticized the board chairman's handling of the personnel dispute and demanded his own resignation in order to pave the way to fresh start at the bank.
Hans-Christoph Hirt, director of the Hermes Group which represents influential shareholders of Deutsche Bank, pointed out that the appointment of Sewing was already the "sixth change of CEO" during Achleitner's six-year term as board chairman. "Why was it necessary to appoint a new CEO now?", Hirt demanded.
Deutsche Bank suffered annual losses of 735 million euros (905 million U.S. dollars) in 2017, taking the total figure of cumulative annual loses since 2015 to 9 billion euros. Ingo Speech, fund manager of Union Investment consequently noted on Monday that Sewing would have to "set a new tone to finally lead the bank back to profitable growth" if he wanted to conclude sluggish reforms started by his predecessor.