Deutsche Bank Aims High after Reorganization

Deutsche BankDealing with a large corporate reorganization can be very stressful. It can appear that the reorganization is going nowhere but with persistence and clear vision, reorganization can succeed in making your company better than it was. Succeeding in this realm can instill confidence and a refreshed image of your corporation to potential investors and financiers.

After taking many hits in the global crisis a few years ago, some banks have rebounded and are doing very well. Others are still on shaky ground but are doing everything they can to be successful in a depressed market. Deutsche Bank has recently finished an extensive reorganization of its operations and hopes to use that momentum to improve its standing. Specifically, the transaction banking division is focusing entirely on growth with its new team in place.

Transaction Banking Division (GTB) Head Wants  €2.4 Billion in Income before 2015

Recently, the head of the GTB, Werner Steinmuller, has claimed that his target for growth is to earn over €2.4 billion in pre-tax income by 2015 with the GTB. That’s a tall order considering that last year’s value was around €1 billion.

How does he propose meeting this goal? Well, Steinmuller claims, according to CFO Insight, the “new leaderships of the GTB [is] the best he has had.” Using that influence and confidence, Steinmuller has managed to get more financing from the bank in order to make the necessary changes he needs to meet this goal.

More Risk Possible

Deutsche Bank seems to have a much stronger interest in the work of the GTB division, and with additional financing, Steinmuller knows he can take more risk but also garner more rewards for his risks. He credits his optimism, according to EuroMoney, to the fact that the division has conducted “a thorough bottom-up analysis of the division’s potential carried out before defining them.”

As EuroMoney notes, existing clients and new clients outside of the banking finance world are going to be key for the GTB. Steinmuller is hoping that a new sales force will be instrumental in those areas for doubling revenues.

Setting High Goals

Proclaiming high goals like Steinmuller has done can be motivational for a corporation. They can also lead to better chances of funding and investment, depending on how convincing you are. But any corporate strategist or finance head needs to be careful. While making the claim might look great at the start, failing to meet an unreasonable goal will ultimately look bad for you, potential investors, and employees. It’s a tough balancing act, but one that needs to be performed in order to motivate and produce results.

Does your company set high goals similar to what Wemer Steinmuller has done at the GTB? Why or why not?

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