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July 25, 2011 7:54 pm
Anshu Jain and Jürgen Fitschen are set to take over the reins of Deutsche Bank as co-chief executives next May, succeeding Josef Ackermann after his decade in charge of Germany’s biggest bank.
Deutsche confirmed the moves on Monday as revealed it also wanted Mr Ackermann to stay on as supervisory board chairman.
The decision marks a remarkable ascent by Mr Jain, an Indian-born UK citizen and the top investment banker at Deutsche, who will become the first non-native German-speaker to head the flagship bank in Europe’s largest economy.
Mr Jain, 48, has headed the bank’s powerful global markets operations since 2001. He is likely to be entrusted with guiding Deutsche’s most profit-generating operations in a move that is set to be welcomed by investors.
Mr Fitschen, an experienced German corporate banker, is likely to be the face of Deutsche Bank in its domestic market.
Deutsche hopes the dual management structure will balance its powerful international investment banking operations with its need to continue to expand its domestic base after the global financial crisis.
The succession plan, which is expected to take effect after Deutsche’s annual meeting expected next May, is likely to be seen as an interim measure since Mr Fitschen, 62, will be given only a three-year contract until 2015. Mr Jain’s contract will run to 2017.
Mr Ackermann, one of the global banking industry’s elder statesmen and a survivor of the financial crisis, is likely also to continue to play a key diplomatic role on the international stage at the bank he has led since 2002.
Deutsche said it wanted Mr Ackermann to move to the supervisory board so the bank could “profit from his knowledge, experience and professional network”. His acceptance of a supervisory board role is a reversal of his previous denial that he would stay on.
Mr Ackermann’s direct move from management to the supervisory board, where he would be voted in as chairman, first needs backing from holders of at least 25 per cent of the bank’s shares, a measure intended to maintain corporate governance standards.
Clemens Börsig, the current chairman of Deutsche’s supervisory board who had appeared to be locked in an increasingly bitter argument with Mr Ackermann over the succession, said he would step aside in 2012, a year early.
Mr Jain, head of the corporate and investment bank, has been a close lieutenant of Mr Ackermann for almost a decade. He is already responsible for the operations that make up most of Deutsche’s profits and revenues.
Mr Fitschen, 62, has a lower profile internationally but is well-known in Germany where he is chief executive of the bank’s domestic operations.
The new leadership structure for one of Europe’s biggest investment banks comes after Deutsche failed in its last attempt to replace Mr Ackermann, who had originally wanted to leave in 2010, and after divisions mounted at the bank this year over the succession issue.
Analysts at JPMorgan said the changes were positive in the short-term but questioned the viability of the structure put in place.
In a world that is focused on macro issues and where bank managements are stretched with regulatory and macro issues, we feel the trio would be powerful in managing this difficult environment,” said analysts at JPMorgan.
“The risk we see is that Mr Jain could be constrained in executing his strategy and making his own mark with Dr Ackermann as chairman of the group,” they said.
Deutsche is set to announce its second-quarter results on Tuesday.
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