Hundreds of Deutsche Bank City traders face axe as London bears brunt of equities trading job cuts

Sewing is trying to get the bank’s return on equity up to 8% by 2022 compared with around 1% now.

Deutsche’s shares gained 5% today and Moody’s credit rating agency reaffirmed its ba1 rating.

Deutsche, whose main investment banking headquarters are at Winchester House on London Wall, said it was still committed to the UK, where it opened its first branch in 1873.

“We will retain a significant presence here and remain a close partner to our UK clients and to international institutions that was to access the London market,” a spokesman said.

The remaining investment bank here will focus on foreign exchange, bonds, corporate finance and mergers and acquisitions. Deutsche will also set up a corporate bank providing the financing and treasury products corporate clients need to trade around the world.

Most staff were being told their fates today, with many being fired on the spot. The process began in Asia overnight and was rolling through the day in London and on the continent.

Jonathan Evans, Chairman of head hunting firm The Sammons Group said he had started receiving calls from Deutsche staff in London on Friday seeking advice on getting rehired: “There is always going to be selective hiring taking place in trading, but it is currently very tough to get roles across the equity markets. The truth is, there’s been overcapacity for some time in an industry which is increasingly seeing technology and regulation taking over. The days when research incentives drove trading order flows came to an end with the introduction of Europe’s Mifid II and Deutsche’s redundancies show the effect of ongoing regulation”.

Deutsche's statement said: "We have decided to focus our resources on businesses where clients need us most. We are setting up a dedicated corporate bank specialising in the financing and treasury products the world's companies need to support trade and investment around the globe. Deutsche Bank will remain an international bank."

In yesterday's announcements, the bank said it would set up a "bad bank" of £66 billion of toxic assets as well as closing its equities trading arm. The extent of the pullback surprised many analysts.

It is not clear how many UK staff will be leaving, partly because equities teams work in various departments such as derivatives or compliance, but it is expected to number in the hundreds. Some were told to leave instantly, while others have been said they will be staying for longer in order to work on running down the operations.