Deutsche Bank’s new strategy is a little bit Barclays, a little bit Goldman Sachs
What sort of a place does Deutsche Bank want to be? Fortunately, the house of Anshu and Jürgen isn't being at all mysterious about its intentions. After the ruckus at today's AGM, Jürgen Fitschen proceeded to spell out precisely how DB intends to evolve.
"Only a few banks globally can aspire to be the leading client-centric global universal bank," proclaimed Fitschen (as per the slide below). "And now we are the only European bank to be able to do this."
Strangely, Deutsche's vision of its future doesn't sound all that different to Barclays.' The British bank also wants to be a "real client franchise," something which it too claims there are very few of. Barclays is reshaping its business to increase its return on equity and cover its cost of capital. So is Deutsche Bank! The real differentiator is that Deutsche Bank aspires to be global and Barclays just wants to focus on its clients in the U.S. and the U.K. Deutsche is clearly therefore the better place to be if you want to work in Asia.
Last man standing
Deutsche is also fully subscribed to the notion that it will rebuild its seriously dwindling fixed income, currencies and commodities (FICC) market share once rivals like Barclays and Credit Suisse give up. There was no direct mention of FICC at today's AGM but it was referred to in euphemistic statements such as, "We see good opportunities to win market share in highly profitable business segments especially at a time when our peers are withdrawing." Goldman is also fully signed up to this approach. However, if Barclays is pulling back only from the capital intensive business areas that generate low returns, it's not entirely clear how Deutsche's push for market share in these areas will boost its return on equity at the German bank....
In investment banking, Deutsche's main focus continues to be building its business in the U.S, as per the slide below. Deutsche has already made some senior U.S. fixed income hires this year. It could always try picking up a few people from BNP Paribas next.
How paranoid should these senior BNP bankers in the U.S. be now?
One chart that may dissuade you from joining Deutsche Bank’s FICC business
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