Late on Friday, Deutsche Bank finally named a successor to Paul Achleitner as chairman of its supervisory board. Alexander Wynaendts, former chief executive of Dutch insurer Aegon, will – barring any extraordinary hitch – take up the role at the bank’s annual general meeting on May 19, 2022.
By then it will be two years since Achleitner, an Austrian investment banker who arrived in May 2012 with the reputation of being Germany’s great M&A dealmaker, announced he would be stepping down.
Not even his greatest fan would call Achleitner’s tenure a success, dogged as it has been with mistaken appointments first to maintain and then to re-engineer the bank after the great financial crisis and only partially redeemed by progress since 2019 under his third chief executive, Christian Sewing.
Wynaendts understands German well enough to know who will really run Deutsche once Achleitner departs
It has taken so long for the nominations committee, led by Mayree Clark – a US former investment banker at Morgan Stanley – to find a replacement that rumours have spread that nobody wanted the position.
Clark has named not only a non-banker but also a non-German. Wynaendts, the son of a Dutch diplomat, speaks several languages after attending French schools in Beirut and Jakarta, but only passable German.
That need not be an obstacle with the German public now that Deutsche has such a traditional German chief executive. It is not as if Wynaendts is American or English. But they may well ask what does a person who has served at an insurance company for a quarter of a century bring to the bank that carries the country’s name?
Wynaendts does have some relevant experience. He began his career at ABN Amro and worked in investment banking, notably in its renowned equity capital markets joint venture with Rothschild before joining the corporate development side of Aegon in 1997 and doing corporate M&A.
He took over as CEO in 2008 just before the financial crisis required Aegon to take a state bailout. In the years following, he grew it through acquisitions in emerging markets initially in Asia and central and eastern Europe. Because Aegon derives so much revenue from the US, where it bought Transamerica in 1999, he grew used to dealing with US regulators.
After retiring, Wynaendts joined the boards of Citi – which he must now leave – and Uber, as well as the advisory board of Salesforce, two of the leading platform companies.
He has a useful understanding of technology, having taken a degree in electrical engineering at the École Supérieure d’Electricité Paris in 1984, before studying economics. He shares this in common with Deutsche’s new group chief risk officer Olivier Vigneron, announced on Sunday night, who also has an engineering degree.
M&A track record
Wynaendts championed a digital expansion at Aegon from the middle of the last decade when Deutsche was still wrestling to transition from legacy technology. This is all to the good, but more significant might be that M&A track record.
Achleitner, engineer of the disposal by German banks of cross shareholdings in their industrial clients and promoter of various attempted domestic banking mergers, was supposed to be the man to remake Deutsche into a European leader.
He didn’t. Its last big acquisition was Germany’s Postbank in 2010, which it briefly considered selling on his watch and has only just managed to integrate.
Could Wynaendts be the chairman to oversee that revival instead?
Given the high regard in which Sewing is now held at the bank, it is unlikely Wynaendts would have been appointed unless the two believe they can work together and share some chemistry. They have met more than once, even though the executive team has no official say in appointments to the supervisory board.
The focus for Deutsche in 2022 is producing the revenues, cost efficiencies, profits, returns on tangible common equity as well as dividends and share buybacks that Sewing and his team promised investors in 2019.
If they can do that and maybe capture the benefit of rising rates as well – Sewing has recently taken to lecturing central bankers on their ill-advised continuation with quantitative easing – then attention will shift once again to what role a restored Deutsche might play in mergers and acquisitions outside Germany.
European banking consolidation must come eventually. Sewing is already thinking of next steps.
“He is a European at heart,” Clark stated, rather oddly, of Wynaendts. If this is code that the Dutchman thinks joining Deutsche gives him the chance to head a continental banking champion that one day might credibly compete with the US leaders in global finance, then good luck to him. Let’s see what he can do if and when.
But Sewing and his team must deliver first. Presumably, Wynaendts understands German well enough to know who will really run Deutsche once Achleitner departs.
