Deutsche Bank AG is imposing a companywide hiring freeze as its chief executive John Cryan steps up his plans to cut costs and allay fears about its weak profitability. Hiring will be put on hold in almost all divisions with immediate effect. Overall, the bank’s plan is to reduce its total staff numbers to about 90,000 in the coming months. A spokesman for Deutsche Bank refused to comment on the hiring policy. He referred to a statement on October 6th, when the bank announced that it has reached an agreement with labor representatives to cut 1,000 positions in Germany as part of the wider restructuring plan. The lender employed more than 101,000 people in June, up from 98,138 at the end of 2014.
Currently, Mr. Cryan is trying to restore investor’s confidence, but he faces a number of challenges. The US Department of Justice said it wants to fine the bank US$14 billion for mis-selling mortgage-backed securities before the 2008 financial crisis. The bank is presently locked in discussions, but fears of a multi-billion dollar fine have raised concerns it will need to raise capital, sending its shares skidding. The CEO has already announced that Deutsche Bank may fail to be profitable this year after posting the first annual loss since 2008 last year.