Anshu Jain and Juergen Fitschen, two Deutsche Bank chief executives, announced their resignations last week, while the bank is still struggling to alter its negative image created in the aftermath of legal disputes.
Paul Achleitner, supervisory board chairman, said the resignation proved Jain and Fitschen’s commitment to the bank and put their own interests behind what was best for Deutsche Bank.
Reuters reported that Jain could not commit to the five years that he felt would take to resolve the bank’s strategy problems. Alongside this and after discussions with co-CEO Fitschen, they both decided to leave the company.
Litigation and tougher regulations led to a $2.5 billion fine to settle allegations surrounding the rigging of benchmark interest rates, which tarnished the division occasionally referred to internally as Anshu’s army.
According to Reuters, at last month’s AGM in response to criticism from shareholders, Jain implied that he was thinking about leaving the company. “I don’t want to stand in the way of the development of the bank and if necessary I will step side,” Jain said at the event according to a source.
Involved in his own legal problems, Fitschen was unable to do his job effectively and could not sell the group’s strategy to domestic shareholders, as well as maintain the bank’s German profile.
Former chief financial officer for UBS and current member of Deutsche Bank’s supervisory board, John Cryan will replace both Jain and Fitschen to become the sole CEO from the beginning of July.
Cryan’s performance at UBS has been described as underpromising by analysts at Jefferies investment bank and they predict a better future for Deutsche Bank with Cryan as CEO.
In a statement announcing his appointment, Cryan said that there were a lot of changes to be made. “Our future will be defined by how well we deliver on strategy, impress clients and reduce complexity,” Cryan said.
According to Reuters, Cryan will not be making any significant changes to the bank’s new strategy blueprint that he was heavily involved with, regardless of the plan being criticised by investors for being too little too late. “The strategy will not be reformulated but there’s obviously room to shape the details of the strategy,” a source told Reuters.
Reuters also report that Deutsche Bank has been one of the weakest performers of any major bank since Jain and Fitschen took over as co-CEOs in June 2012.