30,000 jobs ‘facing axe’ in German bank tie-up

A MERGER between Germany’s two biggest banks will put 30,000 jobs at risk, union chiefs warned.

It is feared the £22.1bn tie-up between Deutsche Bank and Commerzbank would allow bosses to push through huge cuts as they battle to boost profits.

The merger has support from the German authorities as a way to shore up their country’s flagging financial system.

But it has sparked alarm from some analysts and investors who worry the deal will simply create an unwieldy behemoth where performance is even worse.

Deutsche has been battling to save money, axing thousands of jobs. A deal with Commerzbank could simply be an excuse for chief executive Christian Sewing to swing the axe again. The combined group would have a fifth of the German retail banking market and employ 140,000 worldwide, including in London.

Jan Duschek, of trade union Verdi who has a seat on Deutsche’s board, said 30,000 jobs could go as a result of the deal – the vast majority in Germany.

He said: ‘In our opinion a possible merger would not result in a business model that is sustainable in the long term.’

One Deutsche shareholder said: ‘We have considerable doubts about the logic and the timing and want to be convinced.’

Sewing is said to have initially opposed a merger, but has bowed to pressure from authorities.

He confirmed merger talks in a letter to staff at the weekend, saying: ‘I have consistently stressed that consolidation in the German and European banking sector is an important topic for us.’ ÷ FRENCH banks have been ordered to set aside extra cash to protect against a downturn in the country’s economy. The authorities fear there has been a surge in reckless lending, and have ordered banks to increase the amount held in a buffer fund which can be used in emergencies.