Thousands of jobs are at risk in London after Deutsche Bank announced it will cut 18,000 roles globally in an attempt to stem its 10-year decline.

Germany’s largest lender has expressed its intention to shut down its global share-trading business and significantly reduce its investment banking operations in a drastic overhaul, costing the bank €7.4bn (£6.6bn).

While Deutsche did not reveal where the job losses would be, the bank’s largest investment finance operations are in London, where around 7,000 people work, meaning that major cutbacks are likely. The bank said it aims to reduce its number of employees to 74,000 by 2022. The lender added that it will feel the cost immediately, forecasting a loss of €2.8bn in the second quarter of 2019 as it has to cover severance and restructuring costs.

In a statement, Deutsche Bank chief executive Christian Sewing said: “This is a rebuilding which, in a way, also takes us back to our roots. We are creating a bank that will be more profitable, leaner, more innovative and more resilient. It is about once again putting the needs of our clients at the centre of what we do – and finally delivering returns for our shareholders again.

“I am very much aware that in rebuilding our bank, we are making deep cuts. I personally greatly regret the impact this will have on some of you [Deutsche Bank employees]. In the long-term interests of our bank, however, we have no choice other than to approach this transformation decisively.”

As part of its plans, the bank will transfer €74bn of risk weighted assets into its Capital Release Unit (CRU) to be sold over the course of the coming years, which Sewing will take responsibility for.

The lender also announced it will cut back its fixed income operations, which handle instruments such as government and corporate bonds.

Despite labelling the plans a “restart”, many will take the announcement as an admission from the bank that, at present, it cannot compete with rivals.

However, Sewing added: “Our goal is clear: We want to achieve a post-tax Return on Tangible Equity (RoTE) of 8 percent by 2022. It is absolutely vital that we achieve this if we want to be competitive in the long term.”

Following the breakdown of merger talks between Deutsche Bank and Commerzbank, Sewing unveiled plans to investigate a major restructuring when he promised shareholders “tough cutbacks”. The overhaul came after a series of reforms by the bank aimed at halting its decline and falling share price.

Over the last five years, Deutsche Bank’s share price has fallen more than 70 per cent. Before the financial crisis, Deutsche shares were valued at over €110. However, now they are valued around €7.

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