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Deutsche to axe 2,600 jobs
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February 1, 2001: 6:16 a.m. ET
German bank cuts jobs, splits businesses in bid to boost profit
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LONDON (CNN) - Deutsche Bank, the world's second-largest bank, said on Thursday it will axe thousands of jobs and split itself in two to keep its growth on track.
The German bank plans to reorganise its businesses into two units – one comprising investment and corporate banking and the other retail banking, private banking and asset management.
Some 2,600 jobs will be lost in the restructuring and the bank will take a one-time charge of  500 million ($471.6 million) to see through the changes.
 Chief executive-designate Josef Ackermann will be in charge of investment banking and will be charged with increasing profits by more than 30 percent over the next three years. Current chief executive Rolf Breuer will take charge of the private banking and retail arm until he retires in 2002.
The move is expected to generate cost savings of 1.5 billion and increase earnings per share by more than 15 percent a year up to 2003.
The Frankfurt-based bank said full-year profit doubled to 4.95 million, in line with expectations, from 2.45 million a year ago. Earnings per share rose to 9.02 from 4.86 in 1999.
Deutsche Bank also said fourth-quarter profit eased 2 percent to 581 million. Analysts polled by Reuters had expected net profit of 4.96 billion in full year 2000 and 598 million in the fourth quarter alone.
Full-year profit was boosted by the sale of shares in insurer Allianz worth 2 billion. Net commission income jumped 42 percent driven by profits from Bankers Trust, the U.S. bank that Deutsche bought two years ago.
"We achieved bulge bracket status and only Morgan Stanley is better (in terms of earnings," Deutsche's Breuer said. "We have a successful merger with Bankers Trust to thank for this." Breuer also said he was cautious about the bank's outlook for 2001 because of a slowdown in U.S. economic growth.
Fourth-quarter pretax profit fell a bigger-than-expected 20 percent to 818 million, while analysts expected 868 million.
"The fourth-quarter results were not too good," BHF Bank analyst Volker von Kruechten told Reuters. "Net commission income in the final quarter is down 10 percent, while trading profit fell 4 percent. Earnings in the fourth quarter overall went down while administration costs rose."
Shares in Deutsche Bank (FDBK) fell 6.1 percent to 98.20 in midday Frankfurt trade. 
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