Changes proposed to the bank’s supervisory board include naming three management board members, said the person, who declined to be identified because the matter is private. Jain and co-CEO designate Juergen Fitschen plan to replace two board members with investment bankers and add another executive from the business, said the person.
Josef Ackermann, who steps down in May after a decade as CEO of Germany’s biggest lender, is using acquisitions in wealth management and retail banking to reduce Deutsche Bank’s dependence on erratic profits from investment banking. Jain and Fitschen, in charge of Germany, are striving for balance and to cement the firm’s position as a so-called universal bank while promoting bankers with whom they have worked closely, said the person.
“It was clear Anshu wanted to create a management team in his own image,” said Christopher Wheeler, a London-based banking analyst at Mediobanca SpA. (MB) “He’s taking the bank to the next level. This may be seen as positive for the stock.”
Deutsche Bank rose 2 percent to 33.98 euros in Frankfurt trading yesterday, extending the stock’s gain this year to 15 percent.
Deutsche Bank Chief Risk Officer Hugo Banziger and Chief Operating Officer Hermann-Josef Lamberti have been asked to leave the bank, the person said. German newspaper Die Welt reported the changes earlier. Armin Niedermeier, a spokesman for the bank, declined to comment on “market speculation” and said Banziger and Lamberti wouldn’t be available for an interview.
Risk Management
Henry Ritchotte, who was named COO for the global markets division in 2008, will take over from Lamberti, and William Broeksmit, who is head of risk portfolio optimization at the corporate and investment bank, will be in charge of risk management, the person said.
Stephan Leithner, co-head of investment-banking coverage and advisory, will join as management board member for personnel, take on the legal division and head regional management in Europe outside Germany, said the person.
Deutsche Bank’s treasury, which Banziger oversees, would be passed to Chief Financial Officer Stefan Krause, the person said.
Pairing Jain with Fitschen, the bank’s longest-serving management board member, is an attempt to balance Deutsche Bank’s dual roles: A global trading house that competes with the likes of Goldman Sachs Group Inc. (GS) and gets most of its revenue abroad, and a German institution with longstanding ties to the nation’s companies and political establishment.
Executive Committee Expanded
Additional candidates for the top job at Deutsche Bank included Banziger, consumer-banking head Rainer Neske, and Krause, people with knowledge of the deliberations said in July.
“Fitschen probably will not feel he has to appoint someone to his former role, but he is likely to step aside in two years and allow Anshu Jain to become sole CEO,” said Wheeler, who has an “underperform” recommendation on the shares as he deems Deutsche Bank to be undercapitalized.
The group executive committee will be expanded to 17 members from 12 and David Folkerts-Landau will join in charge of research, the person said.
The group executive committee is the second-highest ranking body after the management board and helps coordinate the businesses and regions, according to the bank.
Colin Fan, the head of credit trading and emerging markets, and Rob Rankin, who leads the Asia-Pacific region, will head the investment-banking unit, known as corporate banking and securities, the person said.
Asset, Wealth Management
Michele Faissola, who oversees rates and commodities, will head a combined asset and wealth-management operation, said the person familiar with the matter. Asset management is headed by Kevin Parker and the private-banking business by Pierre De Weck.
The division Faissola would oversee combines asset and wealth management and similar businesses that are now part of the investment bank such as exchange-traded funds, said the person.
“It makes sense for a change at asset and wealth management given the performance of the businesses wasn’t exactly a success story,” said Georg Kanders, an analyst with WestLB AG (WESTLB) in Dusseldorf who recommends investors buy the stock. “Asset and wealth management can be consolidated given the business is getting smaller and the focus is clearly on Europe with some operations being sold,” he said.
Deutsche Bank said last month that it’s holding exclusive talks to sell part of its asset-management divisions to the U.S. money manager Guggenheim Partners LLC.
Breaking ‘Eggs’
The negotiations apply to the four businesses that the Frankfurt-based bank put under review, including its DWS mutual funds in the Americas, the advisory units for institutional investors and insurance firms, and its RREEF real-estate and infrastructure division, the lender said. Deutsche Bank is keeping its DWS fund unit in Europe and Asia.
The entire supervisory board needs to approve the personnel changes at a meeting on March 16, the person said.
“Anshu was always going to have to break a few eggs,” Wheeler said. “He will have to put up with some disruption, people may leave if they are unhappy about not getting the promotions they wanted.”
To contact the reporters on this story: Aaron Kirchfeld in Frankfurt at akirchfeld@bloomberg.net; Nicholas Comfort in Frankfurt at ncomfort1@bloomberg.net
To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net
http://www.bloomberg.com/news/2012-03-07/deutsche-bank-said-to-name-faissola-unit-head-in-board-shuffle.html
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