Deutsche Bank is looking to make its Covid-19-induced flexible working arrangement permanent as reducing office space emerged as a feasible way of cutting costs.
As per the revamped work-from-home policy, the bank’s staff can enter into binding agreement regarding the number of days they want to work remotely every week, reported Bloomberg citing people familiar with the issue.
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Deutsche CEO Christian Sewing said that the management is currently working on a “hybrid model” that will outline how employees can divide work between the office and their homes.
The bank has already made estimates of the share that will work remotely, noted the report.
The report comes close on the heels of the bank giving up two of the five floors of office space it rented in one of Zurich’s most expensive office buildings.
In 2021, the bank intends to switch New York offices thereby leading to an almost one-third reduction in office space there.
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By GlobalDataAt the same time, Deutsche Bank trimmed its staff headcount in the US by nearly a fifth over the past two years.
Moreover, DWS Group – Deutsche Bank’s asset management unit – recently moved to a cheaper office in London.
All these decisions have paved the way to reduce costs for the bank, which spent€1.7bn ($2bn) on rent and furniture in 2019.
Deutsche Bank CFO James von Moltke said that the bank is becoming “more aggressive about how we want to use the space, given what we are learning now about the way the workforce will choose to engage and choose to work every day.”
Earlier this month, Deutsche Bank reportedly asked its New York City employees to continue working from home until July 2021.
Other moves
Mizuho Financial Group and Fifth Third Bancorp are also looking to reduce office costs as a large number of employees switch to remote working amid the pandemic.
Last month, US-based investment manager BNY Mellon reportedly asked the majority of its staff to continue working from home for the remainder of the year as Covid-19 cases see a spike.
Moreover, British fund manager Schroders recently provided a permanent work from home option to employees.
However, many firms have raised eyebrows on the remote working arrangement.
Among them is JPMorgan, whose chief Jamie Dimon opines that employee productivity will eventually slip if they work remotely for a longer duration.
Such views have been reiterated by BlackRock’s Larry Fink and UBS Group’s Sergio Ermotti, who believe that remote working hampers the functioning of the corporate culture.
