Deutsche Bank bosses face shareholder anger over massive loss
Frankfurt (AFP) –
Deutsche Bank Thursday told shareholders, angered by big losses and scandals at Germany's biggest lender, that it was on the path back to growth but conceded it wasn't there yet.
"The whole (management board) team −- with the backing of this supervisory board -− want to put Deutsche Bank back on the road to growth," chief executive John Cryan told his first shareholder meeting since taking up his position last July.
"This journey is demanding. It requires effort, but it will be worth that effort."
Groups of shareholders had expressed anger at Deutsche Bank's colossal loss of nearly seven billion euros ($7.9 billion) last year and at the group's apparent slow progress in resolving a large number of scandals and litigation cases.
Its woes sent Deutsche Bank shares into a long nosedive on the stock exchange and forced it to waive dividend payments to shareholders.
"We are not yet where we want to be," said supervisory board chief Paul Achleitner.
"But our objectives are right, our path has been clearly defined and the new management board is making good progress along this path. This gives me confidence -– me, and all of us here on the supervisory board," he said.
Cryan took over as co-chief executive from Anshu Jain in mid-2015 alongside Juergen Fitschen.
But Fitschen is stepping down at the end of the shareholder meeting, leaving Cryan in sole charge.
Deutsche Bank reaffirmed its ambition of bringing down annual costs by five billion euros to below 22 billion euros by 2018.
The lender is currently entangled in a web of legal woes, facing as many as 6,000 different litigation cases, the provisions for which helped push it to a record loss of 6.8 billion euros last year.
At the end of April, the bank warned that this year would also be a difficult year.
- 'Worst-ever crisis' -
Groups of protesters rallied outside the shareholder meeting on Thursday, accusing Deutsche Bank of financing the arms trade or projects that harm the environment.
Inside the hall on Frankfurt's sprawling industrial trade fair, the bank also faced the ire of its shareholders.
"We're concerned about the way things are turning out for Deutsche Bank. Its reputation has suffered, financial markets have lost confidence and the share price is a disaster," said Ingo Speich of Union Investment.
"Deutsche Bank is in the worst crisis in its history."
Hans-Christoph Hirt, of the investment fund Hermes, complained there was "little visible evidence" of management succeeding in its promises of bringing about a cultural change within the bank.
Given the fact that they will not be receiving a dividend, a number of shareholders hit out at the bank's system of remuneration, which, while cutting management's bonuses, is continuing to pay them to employees.
"No bonuses should be paid until everything has returned to order within the bank," said Hans-Martin Buhlmann, representing a shareholders' association.
Deutsche Bank said it is sticking to its longer-term strategy of becoming "leaner and simpler, reducing costs and complexity."
"We will take on less risk. We are improving our capital base and raising our risk buffer, as only a secure bank can be a strong bank," CEO Cryan said.
"We are working with all our strength to build this better Deutsche Bank," he added.
© 2016 AFP