Fifth of Deutsche branches to close as customers move online
DEUTSCHE Bank is to shut one in five branches in Germany as it attempts to cut costs and react to customers switching to online services during the pandemic.
The move is the latest step in Deutsche’s attempts to overhaul its operations and return to profitability after it announced a major restructur- ing last year.
Philipp Gossow, who heads up Deutsche’s retail business, told staff the bank planned to reduce the number of branches in Germany from 500 to 400 “as quickly as possible”.
German banks have retained extensive branch networks as many custom- ers have been reluctant to turn to digital banking, but the virus pandemic has forced a rethink.
“Coronavirus has further changed the demands placed on advisory services and the branch business,” Mr Gossow told Reuters.
“Even customers who were previously not very familiar with online banking are now doing many simple banking transactions from home on their computer or iPad,” he said.
The bank intends to invest in increasing its ability to provide advice by phone and video chat, which are being used more than before, Mr Gossow added. The cuts follow a previous wave
of closures by Deutsche in 2016 which reduced its number of branches in its home market from 700 to 500.
Deutsche’s competitor Commerzbank recently cut 200 of its 1,000 branches and is weighing up a further cull. The changes are the latest by Deutsche as it attempts to streamline its business. The lender suffered a record €5.7bn (£5.2bn) loss in 2019.
The restructuring plan announced last year included 18,000 job cuts by 2022, a scaling back of its investment banking operations and slimming down its balance sheet.
The changes signalled an end of Deutsche’s long-held ambition of competing with the biggest names on Wall Street as a top-tier global investment bank.
The bank did not say how many jobs it expected to axe as part of the German branch closures, which will focus primarily on urban locations.
Trade union Verdi said that it was “generally right” for Deutsche to review its branch network.
The retail division has more than 22 million customers worldwide and was responsible for a €269m pre-tax loss last year.
A Deutsche Bank spokesman said the lender could not comment further as talks with employee representatives had just started.