Deutsche faces tough task paring back retail, investment banking

Sat Apr 25, 2015 11:41am EDT
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By Thomas Atkins

FRANKFURT (Reuters) - If running a global bank is complicated, cutting one back is even more difficult.

Deutsche Bank (DBKGn.DE: Quote) faces a long and costly battle, analysts say, to sell Postbank DPBGn.DE and pare investment banking, the new strategic goals it outlined late on Friday.

While the bank is due to publish results on Sunday, investors will get no details on its overhaul before Monday at a news conference. The scope of the challenge is already clear, however.

Germany’s flagship lender comes late to restructuring after European rivals such as Barclays (BARC.L: Quote) and Credit Suisse CSGN.VX already slashed their global franchises years ago, cutting jobs and hiving off businesses.

Deutsche will face an especially difficult challenge in selling off Postbank without having to post losses.

Deutsche aims to cut its stake to below 50 percent next year from 94 percent by selling shares on the stock market and then to reduce its holding to zero in the medium term, a source close to the matter said on Saturday.

But a battle is already building over the conditions for a sale as the government signals that big layoffs at Postbank should be banned from any deal.

“We're worried about jobs at Postbank,” Carsten Schneider, finance expert and deputy SPD parliamentary floor leader, told Reuters.   Continued...

A Deutche Post sign stands in front of the Bonn Post Tower, the headquarters of German postal and logistics group Deutsche Post DHL in Bonn March 11, 2015.         REUTERS/Wolfgang Rattay