Frankfurt The former head of Deutsche Bank, Josef Ackermann, is very familiar with financial crises. In Switzerland, he often explains to his compatriots how the major bank Credit Suisse, which had to be merged with UBS in March, went down. In Germany, Ackermann was long considered the manager who apparently steered Deutsche Bank through the financial crisis of 2008 without an accident – for this he was given an ovation by the institute’s shareholders in 2012.
The picture got scratched when the bank turned into a restructuring case after the financial crisis because it was sentenced to billions of fines after the next due to the numerous scandals and violations of the law under Ackermann’s leadership.
At the Frankfurt financial conference Euro Finance Summit, there is little evidence of this. The rows of seats in the conference room are filled to the brim – late on a Monday afternoon. The applause is benevolent when the Swiss enters the stage.
That is not a matter of course. Ackermann’s legacy is now viewed critically by many within the bank itself. When Christian Sewing, successor number three to Ackermann, recently wanted to highlight his successes in restructuring the institute, he said that Deutsche Bank is in a much more stable position today than it was when his predecessor Ackermann was there. It would have more capital and more liquidity than it did then. “Is he right?” asks the moderator.
Ackermann is a person who can dish out a lot. Regarding the Credit Suisse crisis, he says without hesitation that Switzerland failed in its supervision of Credit Suisse. Credit Suisse’s problems were all known, but regulators let things take their course for too long. And he criticizes in general that bank supervisors and bank regulators have concentrated too much on making banks resolvable in recent years. “I never believed in that,” says Ackermann. You have to prevent such a scenario “ex ante”.
Ackermann criticizes the shrunken investment business
For his answer about Deutsche Bank, he takes a lot longer. “All banks have become more robust,” he says. The regulation took care of that, called for more capital and more liquidity.
Then the 75-year-old becomes more fundamental. “Of course, we always wanted to build a bank that is a global leader,” he says. You have to ask yourself: “Do you want a bench that is small and robust? Or do you want a bank that is also robust, but that also plays its part globally and in terms of profitability?” Deutsche Bank is practically absent from the investment banker rankings, with American institutions dominating the business. The most recent crises have shown how dangerous dependencies can be.
Regarding this criticism of Deutsche Bank’s clipped investment banking, you have to know that after Ackermann’s departure, bank supervisors on both sides of the Atlantic put enormous pressure on the bank to clip the scandal-ridden investment banking to a manageable level. Ackermann’s successor, Anshu Jain, resisted this for a long time and only held office for three years. Only after-after-successor Sewing has the division shrunk significantly.
Up to this point, Ackermann has not criticized any of his successors by name. He doesn’t think that’s appropriate either. “Anyone who knows me knows that I have never talked about predecessors or successors. This trend of blackening others to make your own gray appear a little lighter was never my trait,” he says. He wants to stay true to himself.
Harsh criticism of ex-CEO John Cryan
He makes it clear more subtly how he thinks about the achievements of his successors. For example, when he delimits the upward trend in the Dax since his departure from the downward trend in the bank’s stock market value. Or when he casually mentions that he has now sold all his Deutsche Bank shares, “the last ones for 35 euros”. That must be many years ago, today the share is listed at just under ten euros.
Ackermann remains true to his principles about successors and predecessors for three more minutes. Then he allows himself a dig. He very much hopes that Deutsche Bank will catch up again. “I would like to say positively that after the catastrophic years from 2016 to 2018 under a CEO that I do not want to name now, Sewing is doing much better and can look ahead again.”
As CEO, Cryan tried to deal openly with the problems of the Ackermann era.
(Photo: dpa)
In the “catastrophic years 2016 to 2018”, according to Ackermann, the Briton John Cryan led the bank. He was the first to openly address the mistakes and problems of the Ackermann era and to criticize them sharply. During this time, Deutsche Bank also reclaimed part of the bonus payments from the managers responsible from the Ackermann era and the Jain era.
In comparison, Ackermann’s judgment on Sewing sounds friendlier. A few minutes earlier, however, he had casually mentioned that a significant part of the bank’s profits in 2022 were due to a tax credit and high profits from the often criticized capital market business.
The Swiss did not practice self-criticism during his almost 40-minute presentation – with one exception. It concerns the goal he once set of wanting to achieve a return of 25 percent. This caused a stir because the bank announced at the same time that many jobs would be cut.
However, Ackermann does not question the 25 percent target itself. That was international practice at the time. Abroad, he would have been accused of not being ambitious enough at 25 percent. But “if I’m self-critical, I wouldn’t have said 25 percent, but four billion euros. That might have been manageable.”
More: Deutsche Bank’s head of personnel, Michael Ilgner, throws it down.