Deutsche Bank bosses fitted for US$1,500 suits as it lays off 18,000 workers

On the day Deutsche Bank began making thousands of employees redundant, some managing directors at the company’s office in London were being fitted for suits that cost at least £1,200 (US$1,500), it has emerged.

Tailors from Fielding & Nicholson, an upmarket tailor, were pictured walking out of the bank’s office with suit bags on Monday. Ian Fielding-Calcutt, the tailor’s founder, and Alex Riley were there to fit suits for senior managers in spite of plans to cut 18,000 jobs worldwide.

Germany’s biggest bank has started the first wave of cuts that some recruiters have predicted could lead to as many as 3,000 job losses in London, where it employs about 7,000 people.

Some laid-off staff were reported to be in tears before leaving the building for the last time.

“Our timing was not great,” Fielding-Calcutt told Financial News.

“I think a lot of the people getting laid off were traders of some sort, who don’t wear suits, and so we just went ahead as normal with our clients who obviously weren’t affected by the cuts.”

Fielding & Nicholson suits take up to eight weeks to make. Prices start at £1,200 and can go as high as the customer chooses, an employee said.

The image of top managers being fitted for luxury suits while other employees, including contract workers and support staff, were laid off was not what Deutsche wanted.

Its chief executive, Christian Sewing, visited London on Monday and repeatedly said how much he regretted the decision to scrap a fifth of his global workforce.

Deutsche’s shares fell 4.2 per cent to €$6.50 – the second day of decline since Sewing unveiled his plan. Sewing has said he will spend €7.4 billion on his cost-cutting programme while increasing revenue and investing €13 billion in new technology.

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After increasing their target price for Deutsche’s shares on Monday, Royal Bank of Canada analysts reconsidered and cut their target on Tuesday to €€7 from €8.

They said Sewing’s ability to execute his plan was less certain than they had thought and Deutsche’s pledge not to raise more capital from shareholders was “walking a fine line”.

Sewing said on Monday he would “put my money where my mouth is” by investing a substantial chunk of his €€3.3 million (US$3.7 million) base salary in Deutsche shares in the next few years.

Reuters reported on Tuesday that he would spend 25 per cent of his salary each year on shares, indicating he intends to invest €825,000 each year.

Deutsche could struggle to hold the remains of its investment bank together after scrapping its equities sales and trading division. Rivals will be circling to pick off disgruntled senior bankers in London, New York and other markets.

Sewing said the bank would pay bonuses to employees who deserved one despite heading for a fourth annual loss in five years.

“We are aware that this is a sensitive topic but obviously we will compensate our people according to their operating performance,” he said.