FRANKFURT, Germany -- Deutsche Bank is to cut costs, shed risky investments and tighten executive pay practices as part of an effort to strengthen itself against a slackening global economy and more regulation.
The shakeup follows a 100-day review by new co-CEOs Juergen Fitschen and Anshu Jain, who took over from Josef Ackermann in May.
The measures announced Tuesday are aimed at helping the bank face uncertain economic growth and governments which are demanding that banks hold more reserves against losses.
Deutsche Bank AG is a major player in global banking. It's Germany's largest bank with a large domestic retail operation. Outside Germany, its investment banking division is a major player in helping companies raise money through issuing shares and selling bonds.
Yet along with other banks, it has seen its earnings fall -- especially from investment banking. Second-quarter earnings slid 46 percent to $844.49 million while revenues were down 6 percent to 8.0 billion euros. The bank attributed the bad results to market turbulence and Europe's financial crisis. The bank has already announced 1,900 job cuts, most of them outside Germany.
Jain told reporters Tuesday that the bank wanted to be "an industry leader" in reforming compensation practices, which have been a chief target for critics of the industry. Large bonuses have been blamed for spurring risky behavior, with losses in the worst cases coming home to taxpayers through bank bailouts.
He added that highly pay remained a chief cost factor in investment banking and would have to be reduced. The new measures will involve top executives seeing their bonuses, largely consisting of company stock, deferred for five years. That is instead of the current practice of giving them by stages over three years.