Struggling Deutsche Bank sets recruitment freeze to balance tumbling profits
EMBATTLED German financial giant Deutsche Bank has introduced a recruitment freeze in a fresh attempt to cut costs and boost investor confidence.
Deutsche Bank's British chief executive John Cryan
The bank's British chief executive John Cryan has already scrapped management bonuses and dividends, shed risky assets and announced 9,000 jobs cuts by 2020 in response to record losses and nosediving share prices.
NordLB analyst Michael Seufert said: "It’s a very drastic step. But it makes sense if they're excluding compliance from the freeze - they have a lot of catching up to do.”
JPMorgan Chase & Co said Deutsche Bank could save up to £1.72 billion through a recruitment freeze.
No DoJ deal for Deutsche Bank
Deutsche Bank has faced a series of setbacks in a difficult 2016
They have a lot of catching up to do
The latest drastic move comes after a year in which high legal fees, challenging market conditions and low interest rates have caused major headaches for bosses at Germany's biggest bank.
And the bank was plunged into crisis last month when the US Department of Justice order it to pay an £11.5 billion fine for mis-selling mortgage backed securities dating back to 2008 financial crisis.
Deutsche Bank has halted recruitment to cut costs
The company's stock value was halved and the financial world was braced for another Lehman Brothers-style collapse.
Equinet Bank analyst Philipp Haessler said: "It would be desirable if Deutsche Bank was restrictive in terms of new hires as they need to cut costs.
"Another way to cut costs is reducing the bonus pool."
Deutsche Bank is expected to release its third quarter earnings later this month.