FRANKFURT Deutsche Bank's (DBKGn.DE) grip on wealth manager Sal. Oppenheim tightened on Tuesday when the exclusive private bank said it will cut jobs and seek additional cost savings by sharing its parent's resources.
The move comes as a blow to the 220-year-old Cologne-based adviser to ultra-rich Germans, which has prided itself on being run at arms' length from Deutsche Bank.
In April Sal. Oppenheim Chief Executive Wilhelm von Haller said it had almost completed a multi-year restructuring, which sent staff levels dwindling to about 930 from around 2,400.
But on Tuesday the wealth manager said it would again adapt its organizational structure to eliminate overlaps and share more services and infrastructure with Deutsche Bank because of slumping markets and tougher regulatory requirements.
"Due to the planned measures, a significant number of jobs are impacted," Sal. Oppenheim said, without providing further details.
The wealth management industry as a whole has suffered from clients holding back on making investments, eroding commission and fee income. The tougher market environment has forced several of Sal. Oppenheim's competitors to restructure.
Credit Suisse's CSGN.VX on Tuesday said that it, too, will overhaul its wealth management operations, integrating its private banking arm and asset management unit.
Sal Oppenheim said it will transfer some fund management activities to Deutsche Bank's asset management unit DWS.
In September Deutsche Bank unveiled a new strategy for its asset and wealth management division - of which Sal. Oppenheim is a part. It said that it wanted to more than double annual pretax profit at the division to 1.7 billion euros ($2.2 billion) by 2015.
Deutsche swooped on Sal. Oppenheim in 2009 when the private bank was forced to sell after investments in Arcandor turned sour when the retailer collapsed.
(Reporting by Edward Taylor and Kathrin Jones)