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Deutsche proposes Thain for board seat

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Deutsche Bank
The headquarters of Deutsche Bank in Frankfurt, Germany -- AFP

DEUTSCHE BANK AG proposed former Merrill Lynch chief John Thain to its supervisory board as part of a wider reshuffle of the body that oversees its top executives.

The 62-year-old is among four candidates who would take over from existing board members when their terms end this year, the Frankfurt-based lender said Wednesday. The appointments would be for five years and are subject to approval at Deutsche Bank’s annual shareholder meeting next month.

The votes come amid rising tensions between Chief Executive Officer John Cryan and Chairman Paul Achleitner. Cryan has been struggling to revive revenue growth after resetting strategy since he took over in 2015. Concerns about the turnaround prompted Achleitner to hold discussions with potential successors, people with knowledge of the discussions said last week.

The chairman himself is under fire for going through three CEOs in six years without being able to forge a recovery.

Deutsche Bank also nominated Michele Trogni, a former executive at IHS Markit Ltd. and UBS Group AG, Mayree Clark, a former Morgan Stanley wealth-management executive, and Norbert Winkeljohann of PricewaterhouseCoopers.

The bank suggested electing Alexander Schuetz to the board for a full five-year term after initially being named for a one-year period. Schuetz is a management board member at C-Quadrat, which holds Deutsche Bank shares on behalf of China’s HNA Group.

ACHLEITNER ‘DELIGHTED’
“We are delighted to have been able to attract such highly qualified new members, each with many years of experience in the financial sector,” Achleitner said in a statement. “They will ideally contribute to the wealth of skills that our supervisory board brings together.”

While some analysts and investors welcomed efforts to deepen the board’s knowledge of financial services, they also questioned whether the company could have achieved a better balance and whether Thain’s record made him a good choice.

Deutsche Bank supervisory board members whose terms expire this year are Johannes Teyssen, Dina Dublon, Henning Kagermann and Louise M. Parent.

The 148-year-old institution has faced a series of challenges and struggled to recover from the 2008 financial crisis. A sustained slide at the investment bank has contributed to hundreds of job cuts as the firm seeks to curb costs and improve returns. The shares have declined nearly 30% since the start of the year.

The bank is now conducting a fresh review of its trading businesses, Bloomberg News reported last week. Cryan is examining activities where Europe’s largest investment bank is trailing competitors to determine if it should try to win back market share or exit, said people familiar with the review, dubbed Project Colombo.

“The revenue outlook does not look encouraging and it remains unclear how Deutsche Bank regains market share – especially in equities,” JPMorgan Chase & Co. analysts Kian Abouhossein and Amit Ranjan wrote in a note to clients on Wednesday. Shrinking the US stock-trading and corporate clients units is “the key” to freeing up capital and improve the company’s returns, they said. — Bloomberg