German Bank to Cut 1,300 More Jobs

Dresdner Bank, the third-largest German bank, plans to slash an additional 1,300 jobs as slumping profits force the country’s lenders to step up cost cutting. Commerzbank said it may eliminate 4,000 jobs.

Banks in Europe’s largest market are shedding more than 15,000 jobs and plan on shutting about 950 branches. The retrenchment follows five years of growth, when Deutsche Bank and Commerzbank increased their work force by more than 30%.

Dresdner Chief Executive Bernd Fahrholz said more job cuts are possible as the company needs to cut costs after reporting a 51% drop in second-quarter pretax profit. The company, acquired in July by German insurer Allianz for $20.7 billion, earlier announced plans to slash 6,500 positions.

Commerzbank, Germany’s fourth-largest bank, said it may eliminate 10% of its staff. “We’re standing in front of a mountain of costs, and job cuts will be part of reducing that,” a Commerzbank spokesman said.

The 1,300 job cuts at Dresdner are in addition to 1,500 investment banking job reductions announced last month and 5,000 Fahrholz announced last year.