Traders were sent packing from Deutsche Bank’s London office today as the German lender shuttered its entire share-dealing department.
Numerous bankers were given until 11am to vacate their offices, while bosses held conference calls to inform different teams about their future.
The job losses came soon after Deutsche Bank yesterday announced it will axe 18,000 roles globally in an attempt to stem its 10-year decline.
Deutsche declined to say how many jobs have been slashed in London, but around 7,000 people work for the bank in the capital, which is home to its largest investment finance operations.
However, the lender said London would “remain a critical part of Deutsche Bank’s future set up” including “from a size point of view”.
Germany’s biggest bank said it will press on with the construction of large new offices in the City despite thousands of jobs being at risk to the radical overhaul.
Deutsche will shut down its global share-trading business and significantly cut back investment banking operations. Deutsche says the restructuring will cost €7.4bn (£6.6bn).
Yet Deutsche confirmed today that it will go ahead with planned new offices at 21 Moorfields, above Moorgate Station in the City, which are currently under construction.
The development will create 550,000 square feet of retail and office space, but it is unclear how Deutsche will now fill the office.
The slashing of the bank’s global staff began this morning in Sydney, Australia and layoffs soon followed in Hong Kong and Singapore before spreading to Europe.
Outside Deutsche Bank’s City headquarters one employee described the mood as “glum”. He said there were “lots of empty desks and blank screens”.
The radical overhaul follows a series of reforms by Deutsche aimed at halting its decline and tumbling share price.
After a brief rise this morning, shares dropped back into the red. They had fallen 6.4 per cent by 3.30pm UK time to stand at €6.72. Before the financial crisis they were worth almost €90.
Alexandra Annecke, portfolio manager at German asset manager Union Investment, said: “The strategy announced by Deutsche Bank was well overdue.”
“Regulation, the low interest rate environment and competitive pressures, combined with the long adherence to an old strategy, all required radical steps,” she said.
Daniele Brupbacher, an analyst at Swiss bank UBS said in a note that the “changes that are probably even more radical than suggested by market expectations and press articles”.
He said the bank was aiming to deleverage – use less debt to make profits – to ensure it was less “vulnerable to external events”.