Deutsche Bank has a market capitalization of almost 20 billion euros.
(Photo: Reuters)
Hardly anyone is as networked in business and politics as Paul Achleitner – and the outgoing chairman of the supervisory board is undoubtedly one of the most prominent players in the German financial scene. And yet the Austrian came very close to failing in the task of restructuring Deutsche Bank. Also because it took him and the managers he supervised far too long to recognize the existential crisis the financial institution was in.
After ten years, Achleitner is likely to hand over his post to Alexander Wynaendts, a friendly Dutchman who ran insurer Aegon for ten years. No glamour, no big vision like Achleitner – Wynaendts is a perfectly normal European manager for an increasingly normal bank.
The former problem child of the European financial scene has just completed its first share buyback program and is paying a dividend for 2021. The question is no longer whether the Frankfurt money house makes money, but how much money it makes. But this is where the problems begin.
Part of the new normal is the fact that the bank is no longer benefiting from its surprise comeback as it has in the past two years. Deutsche Bank is now measured by the same standards as all other major European banks. Wynaendt’s most important job will be to lead the bank into this new phase.
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Sooner or later the much-heralded consolidation of the European banking landscape will begin, and Deutsche Bank still has a lot to do if it doesn’t want to end up as a junior partner in a major merger. That would be a constellation that the economic powerhouse Germany could hardly afford.
>> Read here: This is how the new head of the supervisory board of Deutsche Bank ticks
A few key figures show how far the domestic industry leader still is from the European market leaders. Deutsche Bank has a market capitalization of almost 20 billion euros. The French financial giant BNP is over 65 billion euros.
Perhaps the most important measure of a bank’s health is its share price to book value ratio. A value of one and above signals trust, a value below latent distrust. Deutsche Bank only achieves a value of around 0.3. BNP manages at least 0.54, and the Swiss UBS is one of the very few major European banks to come close to one.
Deutsche Bank certainly made great progress in the late phase of the Achleitner era. The institute has a future again. But the next few years, which will probably be overseen by Alexander Wynaendts, will decide whether it is enough for an independent, self-determined future.
More: A quantum of tailwind for Deutsche Bank – read the big balance sheet check here