'In our bank we have people doing work like robots. Tomorrow we will have robots behaving like people'.
John Cryan told an audience in Frankfurt: “In our bank we have people doing work like robots. Tomorrow we will have robots behaving like people. It doesn’t matter if we as a bank will participate in these changes or not, it is going to happen.”
He also referred to accountants inside the bank who “spend a lot of time basically being an abacus”, who would also be replaced by machines.
In remarks reported by German publication Handelsblatt at a conference in Frankfurt, Cryan added: “The sad truth for the banking industry is, we won‘t need as many people as today.”
Cryan, a Briton who took the helm of Deutsche in June 2015, is in the process of restructuring the bank, which employs 100,000 staff around the world.
Cryan is the latest business leader to make predictions about the impact of automation on on banking roles. In 2015, the former chief executive of Barclays described how the industry was facing an “Uber” moment, with hundreds of branches closing and a potential halving of the number of jobs in the sector.
Andy Haldane, chief economist at the Bank of England, has also warned that robots will be able to take on more work with up to 15m jobs in Britain at risk – not just from the low-skilled jobs traditionally impacted by machinery but also more skilled roles such as administrative, clerical and production tasks.
Others though have been circumspect. Kallum Pickering, an analyst with Berenberg, has said: “Producers will only automate if doing so is profitable. For profit to occur, producers need a market to sell to in the first place. Keeping this in mind helps to highlight the critical flaw of the argument: if robots replaced all workers, thereby creating mass unemployment, to whom would the producers sell?”
Cryan also said that automation might lead to an improvement in jobs. “If you take an accountant at the bank, a large part of their job is to produce numbers. It takes them three to four weeks to produce an account and then they move to the next one. Wouldn’t it be great, if machines could produce those numbers in just a few hours? Then accountants could analyse the numbers, form valid opinions what those numbers mean and not just produce them,” he said.
Cryan also spelt out the opportunity for the Germany financial capital to benefit from Brexit, pointing out the city has the regulatory capability, law firms and consultants and an international airport to take business from London. “These are all arguments in favour of a move to the banks of the Main when faced with relocating from the banks of Thames,” said Cryan. His colleagues have warned up to 4,000 of Deutsche’s 9,000 roles in the UK could leave after Brexit.
Cryan told the conference that Germany and Frankfurt had to decide how much they wanted to benefit from Brexit. “For months there have been discussions regarding which location is set to profit the most once London is no longer within the European Union. I cannot fully understand this debate because as I see it, the race had already been won before it even began,” he said.
While new finance jobs will be created in Dublin, Amsterdam and Paris – all vying for business leaving London – none of these have the infrastructure to take on the business. “There is only one European city which can fulfil these requirements and that city is Frankfurt,” said Cryan.
The choice was not between Dublin, Paris or Frankfurt but New York, Singapore or Frankfurt. “What determines who gets what piece of the cake?” said Cryan. It was not about changing laws or tax subsidies, he added. “In truth, it is its infrastructure that makes London unique in Europe. In this respect, this is where Germany needs to catch up if wants to take over a large share of the business performed in London.”
He said Frankfurt needed “more attractive, urban residential areas, enough international schools and a dozen additional theatres and a few hundred restaurants”.
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