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Morning Coffee: More cuts coming at Deutsche Bank in 2019, with U.S. staff most at risk. How data jobs will die

To be clear, Deutsche Bank was always going to be cutting costs in 2019. The bank aims to end this year with €23bn in total costs, and next year it's target - declared in the summer - was to get costs to €21bn. As of yesterday, however, the 2019 target has changed.

At a conference in London yesterday, Deutsche CFO James von Moltke said the bank now intends to improve upon its €21bn target for 2019, but that the bank now intends to focus on costs as a proportion of revenues rather than absolute spending.

In theory, Deutsche's front office investment bankers and markets professionals should be safe. Although costs consumed nearly 95% of revenues in Deutsche's corporate and investment bank in the third quarter, CEO Christian Sewing has said repeatedly that Deutsche has finished restructuring the front office of its investment bank and is now pursuing growth. Von Moltke said yesterday that the bank intends to allocate more capital to its fixed income business.

In reality, however, that 95% cost income ratio is raising eyebrows. The Financial Times quotes 'one person close to a large Deutsche shareholder' who says the restructuring of the investment bank has not gone far enough and that the U.S. business in particular still needs attention. Another DB shareholder, Alexandra Annecke at Union Investment in Frankfurt, said part of Deutsche's problem is years of under-investment in its IT systems.

Separately, data mining company Palantir doesn't just have incredible pretensions, it also serves as a warning that the current data jobs boom might not last. In an article on the battle between Palantir and Morgan Stanley over Palantir's valuation, Bloomberg lets it be known that Palantir is trying to cut staff costs. The company has reportedly launched software called 'Foundry' which automates the data integration (ie. combining data from different sources into something usable) tasks that were previously undertaken by human data scientists.


New York is already a tech hub. Google employs 7,000 people there (half are software engineers). Facebook employs 2,000. Goldman Sachs employs more than 2,000 NYC technologists and Salesforce has 1,000 people in the city. (New York Times) 

Virginia is effectively paying Amazon $22k per job. (New York Times) 

Crispin Odey is predictably unimpressed with Theresa May's Brexit deal. “In the short-term that’s good for the City, but the City has to worry about populism. The question is, how will the country view this deal?” (Bloomberg)

UBS is creating a group based in the U.S. to cover ‘long term horizon capital pools’ (pensions, sovereign-wealth funds and large family offices). (Bloomberg) 

The head of J.P. Morgan's metals business is called Sid Tipples. He is leaving. (Reuters) 

Kweku Adoboli was deported without being given a chance to pack or say goodbye. “The way he was taken away was brutal.” (Financial News) 

When Mike Corbat became CEO of Citigroup, it had 32,000 clients. Now it has 13,000. (Bloomberg) 

In 2017, 72% of Facebook employees thought they were making the world a better place. Now just 53% do. (Business Insider) 

AI will know when you book your dog kennel as a hotel expense. (Bloomberg) 

How to avoid saying what your job is at a party. (McSweeney's) 

UBS is sending a hologram to a conference. (Twitter) 

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AUTHORSarah Butcher Global Editor

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