Can Deutsche Bank Deliver on its Turnaround Plan?
| Case Code: BSTR660 Case Length: 23 Pages Period: 2008-2021 Pub Date: 2023 Teaching Note: Available |
Price: Rs.400 Organization : Deutsche Bank AG Industry : Banking Countries : Global Themes: Turnaround Strategy, Restructuring, Banks and BankingLeadership and Change Management |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
A Decade of Woes (2008-2018)
The 2008 global financial crisis was a painful period for Deutsche Bank as the bank reported its first annual loss in five decades, losing €3.9 billion in 2008. Some analysts attributed the losses to Deutsche Bank’s strategy of buying poorly secured mortgages from US home buyers, wrapping them up in highly complex ..
‘Compete To Win’ Strategy
On July 7, 2019, Sewing announced a radical transformation strategy called “Compete to Win” to refocus on the bank’s core strengths and improve its long-term profitability (See Exhibit VI). He planned to boost the bank’s profitability by cutting costs while growing revenue and improving returns to shareholders..
Covid 19 Strikes
Even as it finally looked as if Deutsche Bank was going to have a good year in 2020, the sudden outbreak of COVID-19 derailed the bank’s recovery and disrupted its targets. In 2020, Deutsche Bank’s restructuring efforts were paused due to the pandemic and its executives were forced to revisit its strategic plan..
Challenges Ahead
Some critics wondered whether Deutsche Bank would be able to meet its 2022 revenue targets as its investment banking division would witness a slowdown as the volatile conditions that led to a boom in earnings might begin to fade in the future..
The Road To Recovery
In June 2020, Deutsche Bank combined its Wealth Management and Private & Commercial Business International units into a new International Private Bank, which planned to serve 3.4 million private, wealth and commercial clients. In addition, in December 2020, the bank signed a strategic partnership with Google Cloud..
Exhibits
Exhibit I: Deutsche Bank: Consolidated Income Statement
Exhibit II: Deutsche Bank Stock Price (2000-2016)
Exhibit III:
European Banks: Fines and Legal settlements Paid (2008-2018)
Exhibit IV: Deutsche Bank vis-à-vis Competitors
Exhibit V: Deutsche Bank Quarterly Net Profit (By CEO)
Exhibit VI: Deutsche Bank ‘Compete to Win’ Strategy
Exhibit VII: Deutsche Bank: Income Statement
Exhibit VIII: Performance of Deutsche Bank’s Core Segments
Exhibit IX: Deutsche Bank: Segment Wise Results
Exhibit X: Deutsche Bank: Q1 2021 Progress against 2022 Financial Plan
Exhibit XI: Deutsche Bank’s Stock Price Since Strategy Announcement (July 2019-April 2021)
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