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Deutsche-Dresdner sees no private bank buys

FRANKFURT: Deutsche and Dresdner Banks will focus on organic growth and do not expect private banking acquisitions when they merge, the designated head of the combined unit told Reuters.

But without revealing specifics, Dresdner management board member Joachim von Harbou did not rule out that other divisions in the new bank could be eyeing acquisitions to fortify the group.

Harbou said the merging bank, which will rank No. 1 worldwide by assets and No. 3 in private banking, had no purchase targets either in Europe or elsewhere. "With the Deutsche merger we are well represented in private banking in Europe and in America. There are practically no blanks spaces to fill in (and) so I see at the moment no need for purchases in private banking," von Harbou told Reuters in an interview on Saturday evening.

But, he added, "That doesn't necessarily have to hold true for other divisions in the new group."

The merger, which was an effective Deutsche takeover of Dresdner, dramatically reordered the German banking landscape and fuelled expectations for accelerated consolidation as banks strive for global positioning and economies of scale.

Von Harbou said that the bank, which will retain Deutsche's name but Dresdner's trademark green logo, may shed fewer employees with the merger than the previously announced plans for 16,000.

"I can well imagine that the job reductions will remain under the planned 16,000 in the group, 5,900 of which are in private banking, if business goes well," he said.

Fears of layoffs prompted trade unions to warn that they would fight plans to push bank workers off the payrolls.

The banks will seek to shed as many personnel as possible through attrition and retirement, resulting in few forced layoffs, he said.

Von Harbou repeated the board of the merging bank planned to conclude key staffing and strategic decisions by Easter, including plans for London-based investment banking unit Dresdner Kleinwort Benson.

"We have to decide as soon as possible," he said.

When announcing the merger on March 9, Deutsche Bank CEO Rolf Breuer described Kleinwort Benson as a "jewel" whose setting in the merging bank was assured.

The statement surprised analysts who saw the unit overlapping Deutsche's own Morgan Grenfell investment banking division, also in London.

Eight days later, Breuer backtracked and said the fate of the investment unit was open and it could be sold off or integrated into the new group.

Von Harbou rejected reports the merging banks planned to jettison smaller private retail and corporate clients, moving them into their planned high-volume retail unit Bank 24 and out of the private banking division.

"We're going to fight for every client," he said.

Current customers will not be pushed out of the merged bank and into Bank 24 during the reorganisation, rather, they will be allowed to choose themselves which unit suits them best, he said.

"I am convinced that we can convince the large majority of our clients of the quality of Bank 24, which has won over alone since September 1999, 200,000 new clients," he said.

Despite uncertainty about the merged bank's plans, no damaging personnel losses have occurred and only several hundred retail customers have left Dresdner's pool of four million clients, von Harbou said.

"There are no signs that we are losing any staff that would harm the quality of our services or that would exceed the normal fluctuation in staff," he said.

Von Harbou affirmed the banks' merger budget of around three billion euros, saying that two weeks into the integration process there were no early signs that the budget would have to be revised upward.-Reuters