Deutsche Bank COO’s Future Is Now in Doubt
By Steven Arons and William Canny
With assistance by Eyk Henning
- Board Members Lose Faith After Slow Reduction of IT Costs
- Hammonds’s Internal Standing Hurt by Negative Comments
Deutsche Bank AG Chief Operating Officer Kim Hammonds’s future at the lender is uncertain, a little over a week after the dismissal of the chief executive, according to people with knowledge of the matter.
Concerns about slow progress in upgrading the bank’s information technology systems — together with unhappiness at controversial statements made by her — have led to skepticism among supervisory board members and the bank’s management that she’s the right person for the job, the people said asking not to be identified discussing private details.
The supervisory board has not yet taken a decision on her future at the company yet, they said. But her departure, if it comes, could happen very soon, two people said.
Hammonds has struggled to bring the bank’s IT costs down, and they rose fractionally last year to 3.80 billion euros ($4.68 billion) from 3.78 billion in 2016. She defended her record recently by saying she has cut the number of operating systems used by the bank by nearly one-third and sharply cut the bank’s reliance on external staff. Her internal standing was further hurt recently when she called Deutsche Bank “the most dysfunctional company” she’d ever worked for at an internal event, according to people briefed on the matter. Hammonds hasn’t disowned the comments since they became public.
The questions about Hammonds come at a time of leadership turmoil at Deutsche Bank. Chief Executive Officer John Cryan was replaced on April 8 by Christian Sewing, and Marcus Schenck, a former deputy co-CEO, is also leaving the bank. Supervisory board Chairman Paul Achleitner said in a statement that day that the bank was looking to achieve “a new execution dynamic in the leadership of our bank.”
“The manner in which these management changes were carried out – very publicly and without a clearly signaled plan – raises questions about the cohesiveness of senior management and its ability to execute on its plans,” Lisa Kwasnowski and Elisabeth Rudman, analysts at ratings agency DBRS, said in a note to clients Monday.
FAZ first reported that Hammonds may have to leave the company soon. Hammonds didn’t immediately respond to a request for comment.
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