Pressure mounting on Deutsche’s Jain
Following a challenging annual general meeting, with 39% of shareholders objecting to the current leadership, Deutsche Bank’s board continues to face pressures from employees and shareholders.
Having been hit with a series of litigation charges and regulatory challenges, Deutsche Bank announced its new five year strategy, the Strategy 2020 at the end of April and confirmed a reshuffle of leadership responsibilities, including an expansion of Anshu Jain’s tasks as CEO in a bid to contain criticism.
Yet employees seem unconvinced. As Handelsblatt reports, following the AGM, members of the bank’s Corporate Center Workers Council (Betriebsrat) handed out a leaflet singed by the council’s chairmen calling for Jain’s resignation.
Similarly, shareholders remain skeptical that Deutsche will be able to realise the targets set out in Strategy 2020. Speaking at Deutsche’s annual general meeting, Ingo Speich, portfolio manager of Union Investment, which holds 1% of Deutsche’s shares described the period since 2007 as “eight lost years.”
Speaking to InvestmentEurope, he highlighted: “With regard to the Libor charges, we wonder if it was really necessary to get such a high fine? We are worried that the it was related to the fact that Deutsche is not very cooperative with authorities” he argues. “We worry that litigation cost will come up higher than expected in the future” he warns.
“It is important to add that we do think Mr Achleitner is doing a great job, but we voted against the management board because we are not convinced of its strategy” Speich stresses.
Yet in contrast to Deutsche’s Workers Council, Speich stresses the importance of consistency. “Deutsche has just announced that it would increase Mr Jain’s responsibilities, we think this is a belated step in the right direction” he argues.
“It is now up for Mr Jain to deliver, he has to prove that he can use his powers to reduce litigation costs and to motivate people again. For me, the most important part is data, the management board has to prove itself in practice” Speich concludes.