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This public-sourced case describes the latest restructuring efforts by Deutsche Bank (DB) and gives a short history of prior restructuring efforts from the decade before. In July 2019, Christian Sewing, the new CEO of DB, announced a series of measures that included, among others, the elimination of global equity trading, the layoff of 18,000 employees, the creation of a "bad bank" to transfer noncore assets, and the suspension of dividends until 2022. The case describes key decisions a bank CEO makes when a bank needs to change course to return to profitability and growth. The case offers an opportunity to debate these key decisions, as well as discuss some of the prior ones during earlier restructuring efforts, and put the students in the CEO's shoes: What would you do and why? The case also describes key banking performance metrics (e.g., ROE, ROA) and other critical variables such as those reflecting capital health (Tier 1 ratio), as well as gives an overview of the bank business model and factors impacting bank profitability and value.
•To consider key decisions for a bank CEO and their complexities •To examine the strategic choices and trade-offs that DB has to make as it embarks in its latest restructuring •To evaluate DB's latest restructuring plan and discuss lessons learned from the previous two plans •To introduce key performance and capital ratios for banks and the focus on dividends •To discuss the stakeholders of DB, the landscape in the German banking environment, and the competitive forces shaping it •To discuss differences between European and US banking