Deutsche Bank Chief May Face Investor Unrest: Sunday Times
(Bloomberg) -- Deutsche Bank AG head John Cryan may face pressure from investors if his turnaround of Germany’s biggest lender fails to show results in the next six months, one of the bank’s largest investors told the Sunday Times.
“If we don’t see improvement in the next two quarters, pressure will mount on the management board,” Ingo Speich, a senior portfolio manager at Frankfurt-based Union Investment, told the newspaper. “We haven’t seen any sign of growth in the investment bank. We need to see this to prove the strategy is working.”
A spokesman at Union Investment confirmed Speich’s comments to Bloomberg News, adding the asset manager still thinks that Cryan is the “right man” for the job. No one was immediately available at Frankfurt-based Deutsche Bank’s press office. Union Investment owns 3.1 million shares of the lender, as of April, according to data compiled by Bloomberg.
Cryan, who’s been sole chief executive officer at Deutsche Bank since May 2016, is facing increasing skepticism about his turnaround plan, the bank’s third revamp in as many years. Fitch Ratings cut the bank’s long-term credit grade last week, while Autonomous Research LLP has said the lender may be “beyond repair” unless there’s a “miracle” boom at its once-mighty bond-trading business.
Shares of Deutsche Bank have fallen 5 percent this year and they closed at 14.63 euros on Friday, according to data compiled by Bloomberg. They traded as high as 92 euros before the sub-prime mortgage crisis.
“The current stock price is above the melting zone of 10 euros,” Speich said, according to the Times. “If it falls further it will be ugly for the bank and combined with weak results it will be toxic.”