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When Christian Sewing was promoted to CEO of Deutsche Bank almost three years ago, he took on a hell of a job.
He started the biggest renovation in the history of the Frankfurt money house - then the Corona crisis broke out.
Nevertheless, the 50-year-old is surprisingly optimistic
WORLD: Mr. Sewing, top managers like you normally spend most of their lives in the office.
Has that changed for you in the past year?
Christian Sewing: I normally don't spend my working life in the office, but mainly on trips to meet customers, investors, regulators and employees around the world.
In this respect, I was in the office a lot due to the pandemic.
I only went into quarantine for several days at the beginning of March because a colleague had become infected.
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WORLD:
You don't trust your technical equipment in the bank?
It should be pretty old too.
Sewing:
Let's clear up this fairy tale for once: Our bank's IT is very robust and has proven to be very efficient during the pandemic.
At the beginning of March, we sent more than 60,000 colleagues worldwide to work from home - without any technical problems.
In addition, there were record-breaking volumes in payment transactions.
That was a stress test in real time that showed how good and above all stable our IT is.
Of our employees who are not in the branch, 80 percent currently work from home.
Many of our executives - especially in London and New York - have to control their functions from home, including some of our board members.
That went very well too.
Personally, however, I just feel good in the office and also want to show that the captain is on board.
After all, our employees in the branches also continue to work.
WORLD:
Can it become a permanent condition that 80 percent work from home?
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Sewing:
No.
If all meetings take place virtually, the generation and exchange of ideas and thus creativity suffer.
In video conferences, fewer emotions are conveyed; the camera takes some of the energy.
That means, you have to spend 110 percent to come across like a face-to-face meeting.
In addition, many employees want to go back to the office because they lack social exchange and the opportunity to learn from one another.
This is very important for younger colleagues in particular.
But not just for them: our Supervisory Board Chairman Paul Achleitner and I also use every opportunity to exchange ideas personally.
WORLD:
You would have to love the home office because it opens up new savings opportunities for you.
Sewing:
Of course that's a positive side effect.
After the pandemic, we will not completely return to the old world of work.
We are adjusting to a hybrid model in which employees can flexibly choose between working from home and in the office - of course, depending on whether this is compatible with the respective task.
But what exactly this model looks like, we will develop together with the employee representatives, because this is about much more than just renting office space.
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WORLD:
Not only you are measured by the fact that you achieve savings goals.
The entire German financial sector has been shrinking for years and, like Frankfurt, is becoming less and less important.
Isn't that frustrating?
Sewing:
We are currently seeing a turnaround: Frankfurt is once again becoming significantly more interesting as a financial location, and Brexit has made the financial center significantly more important overall.
Foreign institutes have significantly increased this.
And we at Deutsche Bank feel the tailwind.
Our task as the management team was and is to make Deutsche Bank clean, robust and sustainable for our customers and our employees - and we are on the right track.
WORLD:
Oh, come on.
The bosses of Deutsche Bank used to advise those in power in Berlin.
And today?
Sewing:
Even today we stand by the rulers throughout the country with advice and action, if that's what they're looking for.
In the past three years we have built a really good relationship with the federal government and politics as a whole.
And when it came to setting up aid programs in the spring, we were very active in shaping them - also because the government wanted it that way.
WORLD:
Did the government listen to you?
Sewing:
I'm sure I won't go into the details of our dialogue here.
The government seeks advice in many places, that's a good thing.
And the result speaks for itself: the government did a really good job, it made a quick and precise decision.
That was strong.
Through the numerous aid and support programs, federal and state governments have ensured that basically healthy companies do not perish within a very short time.
That would have cost us an enormous amount of wealth.
WORLD:
The price for this is high debt.
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Sewing:
Nobody caused this crisis, it is an external shock.
That is why I think it is right that the state, and thus the community, should mitigate its consequences.
There is no way around temporarily higher debts.
As soon as it is foreseeable that the pandemic will be manageable, there should also no longer be any blanket assistance, as is the case at the moment.
That will require further courageous decisions.
But only in this way will we as an economy emerge from the crisis stronger overall.
And that should be our goal.
WORLD:
This destroys the illusion that Corona has no far-reaching consequences.
Sewing:
Nobody has that illusion.
People have long known and felt that there are such consequences.
And it's only fair to say clearly and honestly where it's going.
Then people are more willing to accept hardship.
We also had this experience at Deutsche Bank.
When we presented our new strategy 18 months ago, we announced severe cuts in our business portfolio and the shedding of thousands of jobs.
Nevertheless, almost 90 percent of our employees think that we are on the right track and also support it - because we have communicated clearly.
WORLD:
What exactly do you propose for the country?
Sewing:
An economic policy should, as soon as possible, provide targeted impulses in place of direct aid for a wide range of companies.
We have to move from simply overcoming crises to shaping the future.
Laying the foundations for future growth now is the best way to pay off debt.
The trend towards a more digital and green economy has accelerated even further in recent months.
With the latter in particular, Germany and Europe have a head start.
And this gigantic transformation has to be financed.
For this, in turn, we need an integrated capital market, because the money cannot come almost exclusively from the banks.
WORLD:
That sounds as if you saw a dictatorship like China as a model, because it clearly defines the sectors in which it controls an economy.
Sewing:
I don't know how you came up with it.
It's about creating the right environment for innovative companies by providing the right infrastructure, talent and capital.
The model for this is the United States with a fertile environment for founders and innovators and an extremely efficient capital market.
We can achieve that in Europe too - and that on the basis of our own value system.
And on the basis of the technologies in which we are leaders - such as in environmental technology.
We should build on this lead, and that needs a better environment.
WORLD:
Will China be the winner of the pandemic in the medium term?
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Sewing:
I am careful about drawing long-term conclusions from the course of the pandemic.
In the short term, however, one thing is clear: the German economy performed significantly better than expected in the third quarter, mainly due to the high demand from Asia.
Some companies generate a significant part of their sales there, and China is the largest market in Asia.
Products from European companies will continue to be in great demand there, and we support our customers in this.
WORLD:
We make ourselves who strive for global dominance and have no understanding of human rights.
Sewing:
As a global export nation, we benefit from globalization - it has given Germany a “golden decade” over the past ten years.
But the pandemic has undoubtedly resulted in companies reviewing their supply chains and diversifying if necessary.
But it is also correct: The Asian growth markets are very important for our prosperity.
WORLD:
This is window dressing.
Tensions between China and the US are growing.
We may have to choose one side.
Sewing:
The prosperity of the Federal Republic of Germany and the European Union is based both on the fact that we live values such as human rights, democracy and the market economy, and on our global export model.
It is important to connect these with each other, and that is what happens.
I was with the Chancellor on her last visit to China.
She also found clear words on critical issues.
WORLD: But
she didn't find a hearing there.
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Sewing:
Don't underestimate how much attention our Chancellor gets.
China also needs Europe and the USA.
That is why it is so important that Europe grows closer together and thus builds a larger home market.
That must be the most important strategic task in the next few years.
This would strengthen our weight and our negotiating position in the world and of course we would be able to better set standards.
WELT:
At the moment, however, it looks as if cooperation and exchange between individual countries will be significantly reduced.
Is the phase of constantly advancing globalization over?
Sewing:
Globalization is not over - the younger generation in particular thinks, acts and communicates globally.
And Germany as an export country will continue to benefit particularly from globalization in the future.
However, regional peculiarities will again play a greater role on the world market.
The result will be what is known as glocalization: globalization with a local face.
WORLD:
How will the Corona experiences shape our lives permanently?
Sewing:
We will live more consciously.
That is why the pandemic has not pushed the issue of sustainability into the background, which is an economic advantage for Europe.
The work of nursing services and nurses will have a completely different status - and that's right.
So our value system will change.
And a lot will remain, for example the masks.
Similar to Japan, people in Germany will wear them during the flu season in the future.
WELT:
But that also means that many jobs lose their status.
Anyone who has previously advised customers in a store will in future have to deliver food or pack parcels in the warehouse of an online retailer.
Sewing:
It is true that the pandemic has dramatically accelerated the change that was already taking place in many industries.
But that does not mean that entire branches of the economy will necessarily disappear.
It is also about flexibility, creativity and courage.
WORLD:
That may be.
But there will be fewer trade fairs, business trips and customers in stationary retail in the foreseeable future.
Sewing:
Most entrepreneurs no longer expect customers to behave exactly as they did before after the pandemic.
It starts with everyday things: Many people will continue to pay cashless at bakeries in the future.
Customers get used to a new behavior and they will continue to do so after Corona if it has proven itself.
That brings hardship, but also harbors business opportunities.
WORLD:
That sounds so harmless.
In practice, this is associated with bitter cuts - also at Deutsche Bank.
Sewing:
Of course, we always said that openly.
We react agilely and flexibly and adapt to the behavior of our customers.
That is why we are closing 100 branches more than originally planned in Germany, for example, and are instead investing in our digital offerings.
Many customers, including older ones, got used to video advice in a very short time.
That is the only reason why we were able to grow so strongly in investment products this year, for example.
WORLD:
Isn't it more likely that you otherwise miss your goals in private and corporate customer business?
You are already behind your plan.
Sewing:
That's not true.
In terms of income and costs, we are absolutely on target in both segments.
Yes, due to the pandemic, interest rates are even lower and risk provisions are higher than expected in summer 2019.
But we were largely able to compensate for that.
Our corporate bank, for example, was in great demand during the crisis, even among companies that were not previously our customers.
We were perceived as part of the solution and have become significantly more relevant again.
WORLD:
This was offset by much better results in investment banking.
This year you generated almost 40 percent of your sales here.
In the end, is and will Deutsche Bank remain a big gambler because there is hardly any other way of making money?
Sewing:
Thank you for being able to dispel this prejudice too.
You have the wrong picture of our investment bank, there is no gaming here.
Our regulators don't allow that.
We earn money exactly where I predicted it a year and a half ago and where we create added value for our customers: in the bond business, currency business, interest business and financing business.
We finance states and companies with our corporate bank and our investment bank.
These are traditionally the strengths of Deutsche Bank.
Back in 1990, when I was doing my apprenticeship, the financing and borrowing business was our company's great strength.
I am very proud that we are now working even more successfully here than we originally expected.
WELT:
But above all you have benefited from the movement on the markets.
Sewing:
Yes, but a large part of the success is not due to the special market environment this year and is repeatable.
Our customers have more confidence in us again.
And what is important is that nothing has changed in our strategy.
We are not investing more capital in the investment bank than originally planned.
The main reason we do more business with existing customers is because they appreciate that we focus on what we do best.
WORLD:
All banks complain about the zero and negative interest rates.
How long can you hold out?
Sewing:
For a long time, because we have adjusted to it.
Of course I would wish otherwise.
But the low interest rates are no longer an excuse - the industry has to adapt to this in the long term.
We have therefore set up our business model in such a way that we are less dependent on interest and rely on other sources of income.
That is why commission income in private customer business and in asset management or payment transactions in the corporate bank, but also the financing business, including the issuing business, are so important.
And we still have our costs under control.
WORLD:
You have complained about too many banks.
Are you ready for a merger?
Sewing:
Our focus will be on our transformation until 2022.
But every quarter in which we are successful makes us stronger.
In the past twelve months, we have caught up a lot in terms of market capitalization in relation to our competitors worldwide.
The stock market price is still far from where we would like it to be.
But in comparison, we are always better off and are thus creating the conditions that we will sit at the table in the event of a possible consolidation of the European banks - and not just as a junior partner.
That must be our claim, and that is also important for Germany.
To be dependent on imports for financial services would be a strategic mistake.
WORLD:
Can you recommend the banker profession to your children?
Sewing:
If that were her wish, absolutely.
It is all about transformation worldwide, be it with regard to trade flows, digitization or sustainability.
And this change in the economy must be financed.
We banks play an important role in this.
Anyone who really wants to change something is in good hands in a global universal bank such as we are.
It's a super exciting job.
WORLD:
Mr. Sewing, you and your wife have decided to go their separate ways.
How did you get into the new year?
Sewing:
We got in very well.
This text is from WELT AM SONNTAG. We are happy to deliver them to your home on a regular basis.
Source: Welt am Sonntag