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October 20, 2010 1:00 pm
Deutsche Bank’s plans for Postbank could imply the loss of up to 10,000 posts across both banks, employee representatives of Postbank estimated in a response to Deutsche’s tender offer for Postbank shares, which was launched this month.
“Whatever the plans of Deutsche Bank for the split ... among the two banks may be, the [group works council] is convinced that this target is not only excessive, but also unrealistic. It will have to be corrected downwards significantly in the negotiations to be conducted,” Postbank’s works council said on Wednesday.
It said it noted Deutsche’s synergy targets with “great concern but also with significant scepticism”.
The council’s view came as Postbank’s management and supervisory boards said they “categorically welcome Deutsche Bank’s takeover bid” and recommended acceptance of Deutsche’s €25 a share offer.
Deutsche Bank has not published any estimates for job losses, and has said most cost cuts should come from reducing expenditure on IT. Deutsche Bank declined to comment on Wednesday.
Deutsche Bank is buying Postbank to give it a much stronger retail banking presence in its home market, with greater access to customer deposits. Deutsche completed a €10.2bn capital raising this month to pay for the deal, strengthen Postbank and build up its own capital ratios.
Acceptance of the offer in its first week amounted to about 0.05 per cent of the shares and voting rights in Postbank, Deutsche Bank said last week. Deutsche already held 29.95 per cent of Postbank and would now own 30.01 per cent. The tender period ends next month.
Crossing the 30 per cent threshold is significant because under German market rules Deutsche Bank will not have to make a further tender offer to all investors.
Deutsche has said it wanted to acquire more than 50 per cent of Postbank, implying that the offer would be taken up by about two-thirds of Postbank’s minority investors.
Deutsche Bank has pitched its offer at the legal minimum price set by regulators, annoying some representatives of minority investors, since Deutsche has agreed a higher price with Deutsche Post to buy the logistics group’s Postbank shareholding next year.
Postbank’s works council’s assessments of possible job cuts are based on Deutsche Bank’s plans for €1bn of annual synergies, of which €750m will come from cost cuts. Experience of similar projects at Postbank and other banks suggests that will mean the loss of 7,000 full-time posts, affecting 8,000 staff, on top of 2,000 jobs going as part of a current cost-cutting programme, the works council says.
In contrast to the estimates offered by employees, Postbank’s executives and directors said an assessment of cost synergies and the impact on staff “is not definitively possible at the present, since the objectives of Deutsche Bank and possible measures to achieve those objectives have not yet been sufficiently specified”.
Some analysts have warned that Deutsche Bank may find it difficult to cut jobs at Postbank, where 44 per cent of staff have civil servant status, giving them robust job guarantees. Postbank staff are also covered by collective bargaining agreements ruling out compulsory job cuts, which run in some cases until the end of 2012.
Deutsche Bank has said it wants Postbank to continue as a standalone brand with its own headquarters.
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