Crisis-hit Deutsche Bank to push out British CEO

CEO of Deutsche Bank John Cryan speaks during the annual press conference in Frankfurt, Germany. (AP)
Updated 08 April 2018
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Crisis-hit Deutsche Bank to push out British CEO

BERLIN: Trouble-plagued Deutsche Bank is to oust its British CEO John Cryan and replace him with one of his deputies Sunday, media reported, in a bid to get Germany’s biggest lender back on track after years in crisis.
Following weeks of speculation, the move is to come late Sunday during a supervisory board meeting at the bank’s Frankfurt headquarters.
News weekly Der Spiegel and business newspaper Handelsblatt said the bank would tap Christian Sewing, 47, currently a deputy CEO and head of private banking, to take over in May from Cryan, who has been at the helm since 2015.
Deutsche Bank, which declined to comment on the Spiegel report, called the surprise meeting “to discuss the chairmanship and to take a decision the same day,” it said in a statement Saturday.
While Cryan’s contract runs until 2020, press reports in recent days have suggested a rift over strategy with supervisory board chairman Paul Achleitner, who called Sunday’s meeting.
The choice of Sewing over investment banking chief Marcus Schenck, who had been discussed as a possible successor to Cryan, points to a strategic shift toward retail banking in its home market Germany.
Sewing “is popular among staff in Germany but is likely to meet with skepticism among foreign investment bankers,” Handelsblatt said, adding that Schenck was now expected to leave the bank in the coming months.
Given sole command of the lender in 2016 after the departure of co-CEO Juergen Fitschen, Cryan’s task was to restructure Deutsche and clean up the toxic legacy of its pre-financial crisis bid to compete with global investment banking giants.
He has neutralized the worst legal threats, in part by paying billions in fines and compensation, strengthened Deutsche’s capital foundations with an 8-billion-euro ($9.8 billion) share issue last year and floated asset management division DWS on the stock market in March.
But “the financial results have so far not been what all of us would want them to be,” Cryan, 57, acknowledged in a letter to employees last month while fighting to keep his job, referring to an unexpected 751-million-euro loss reported for 2017.
While the bank said the loss was a one-off caused by US President Donald Trump’s corporate tax reform, investors have shunned Deutsche since the start of the year, with its stock dropping around 30 percent in value since January 1.
Handelsblatt said last month that Deutsche Bank remains “what it was when Cryan took the helm: a chronic patient.”
Cryan was seen as a troubleshooter after his successful steering of Swiss bank UBS through the financial crisis as finance director between 2008 and 2011.
But he met his match with the German lender.
“It was clear from the beginning that Cryan’s time in office would be limited and that his job would be ‘clearing up past mistakes’. He’s not a charismatic leader personality or a visionary,” professor Sascha Steffen of the Frankfurt school of finance told Handelsblatt.
“He had to battle serious problems that his predecessors swept under the rug for years,” Markus Riesselmann, analyst at Independent Research, told AFP.
“He’s largely cleared those up and now it looks like Deutsche can’t turn things around regarding margins. But I doubt a new CEO could successfully make that transition. It seems rather to be a fundamental ‘Deutsche Bank problem’.”


‘Don’t be too optimistic’: Huawei employees fret at US ban

Updated 26 May 2019
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‘Don’t be too optimistic’: Huawei employees fret at US ban

  • This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei
  • Another critical partner, ARM Holdings, said it was complying with the US restrictions

BEIJING: While Huawei’s founder brushes aside a US ban against his company, the telecom giant’s employees have been less sanguine, confessing fears for their future in online chat rooms.
Huawei CEO Ren Zhengfei declared this week the company has a hoard of microchips and the ability to make its own in order to withstand a potentially crippling US ban on using American components and software in its products.
“If you really want to know what’s going on with us, you can visit our Xinsheng Community,” Ren told Chinese media, alluding to Huawei’s internal forum partially open to viewers outside the company.
But a peek into Xinsheng shows his words have not reassured everyone within the Shenzhen-based company.
“During difficult times, what should we do as individuals?” posted an employee under the handle Xiao Feng on Thursday.
“At home reduce your debts and maintain enough cash,” Xiao Feng wrote.
“Make a plan for your financial assets and don’t be overly optimistic about your remuneration and income.”
This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei as a result of the ban.
Another critical partner, ARM Holdings — a British designer of semiconductors owned by Japanese group Softbank — said it was complying with the US restrictions.
“On its own Huawei can’t resolve this problem, we need to seek support from government policy,” one unnamed employee wrote last week, in a post that received dozens of likes and replies.
The employee outlined a plan for China to block off its smartphone market from all American components much in the same way Beijing fostered its Internet tech giants behind a “Great Firewall” that keeps out Google, Facebook, Twitter and dozens of other foreign companies.
“Our domestic market is big enough, we can use this opportunity to build up domestic suppliers and our ecosystem,” the employee wrote.
For his part, Ren advocated the opposite response in his interview with Chinese media.
“We should not promote populism; populism is detrimental to the country,” he said, noting that his family uses Apple products.
Other employees strategized ways to circumvent the US ban.
One advocated turning to Alibaba’s e-commerce platform Taobao to buy the needed components. Another dangled the prospect of setting up dozens of new companies to make purchases from US suppliers.
Many denounced the US and proposed China ban McDonald’s, Coca-Cola and all-American movies and TV shows.
“First time posting under my real name: we must do our jobs well, advance and retreat with our company,” said an employee named Xu Jin.
The tech ban caps months of US effort to isolate Huawei, whose equipment Washington fears could be used as a Trojan horse by Chinese intelligence services.
Still, last week Trump indicated he was willing to include a fix for Huawei in a trade deal that the two economic giants have struggled to seal and US officials issued a 90-day reprieve on the ban.
In Xinsheng, an employee with the handle Youxin lamented: “I want to advance and retreat alongside the company, but then my boss told me to pack up and go,” followed by two sad-face emoticons.