In the morning there was still determination. There he was on the day of his last big appearance as a man at the top on stage, his likeness on the huge screen in the Frankfurt exhibition hall: opening speech by the two co-CEOs of Deutsche Bank at the Annual General Meeting in May 2015.
Anshu Jain started, Jürgen Fitschen would continue. Jain was seen speaking but not heard: he spoke in English, his native tongue, through the loudspeakers and an interpreter’s voice. “We are convinced,” he translated Jain, “that we are on the right track.” It seemed as if someone had robbed him not only of his voice but also of his strength.
Jain and Fitschen had made new plans, again, and were struggling to get them across to shareholders. Rebuild the bank, less investment banking, fewer employees, lower costs, would rather sell Postbank and above all: finally eliminate the legacy of the financial crisis, complete court proceedings, make peace with the supervisory authorities. It was clear to everyone in the room that Deutsche Bank still had a long way to go. And it would be expensive. The speeches were followed by hours of criticism from shareholders. Private investors and large investors settled accounts with the management. Jain sat in silence until after 9 p.m. while Fitschen and the chairman of the board, Paul Achleitner, gave the answers.
The day ended with a humiliation: almost 40 percent of the shareholders refused to discharge the bosses. This has no consequences in German stock corporation law, but it is an unparalleled vote of no confidence. Running a corporation without the support of the owners? Difficult. “You tell me if you think I’m not the right one anymore,” Jain said to a board member that evening.
Deutsche Bank’s investment bankers have never been more successful, at least on the surface
A good two weeks later, the management duo was history, Anshu Jain’s career at Deutsche Bank ended after 20 years, and one of the faces of the global financial crisis disappeared from the German scene with him. Jain, the British-Indian banker, a stockbroker of the Wall Street gigantomania era, had made it to the top of one of the world’s largest banks — and failed. The biggest profits fell during his time, but also the heaviest penalties. Deutsche Bank’s investment bankers have never been more successful, at least in appearance, and their excesses have never been greater. Rainmakers, as the star dealers used to be called, could make money rain down. But they were also the ones who received millions in bonuses, while thunderstorms were already brewing over the bank, billions in losses and record fines.
Jain, whose first name is Anshuman, grew up in Jaipur and Delhi. His father had made a career in the Indian Court of Accounts. With his wife Geetika he moved to the USA to study. Early on he dealt with derivatives, complicated financial instruments with which you can make a lot of money, but also lose it. At the end of the 1980s he started at the US investment bank Merrill Lynch and worked for the successful derivatives trader Edson Mitchell. When Mitchell made a surprise move from Wall Street bank to the industry outsider, which was then Deutsche Bank, in 1995, he also took Jain, his most successful employee, with him and promoted him to chief trader in his London office.
It was a time when a culture of greed took hold at the previously rather conservative Deutsche Bank. A culture that put quick money ahead of the well-being of customers and the company, and which has not completely disappeared there to this day. “Play it fast and loose” was the motto. Play it fast and easy.
When Mitchell died in a plane crash in 2000, Josef Ackermann, who was responsible for investment banking at the time, surprisingly appointed Anshu Jain to succeed him as head of the “Global Markets” division, which combined trading in bonds, currencies and derivatives .
Jain knew how to build a protective wall around himself
Was Jain particularly knowledgeable about financial products? Was he a “superbanker” that many portrait writers later hailed him as? Rather not. The real super dealers shook their heads in amusement at the time. He is said not to have understood too much about the risk of the trades. “Just like Ackermann and ultimately Mitchell, Jain was not a banker who structured the complicated financial products himself. He only sold them, come what may,” wrote the journalist Dirk Laabs in his book “Bad Bank”.
And he understood one thing early on: According to Laabs, he always put up a “protective wall” between himself and the trades, no “fingerprints”, no “traces”. Inexplicably, numerous e-mails and audio tapes were later deleted. And although Jain’s division was soon responsible for the large losses in the financial crisis, which had long since weakened the bank, he continued to rise. First to the board, responsible for investment banking, and in 2012 to co-head of the bank. In succession to Ackermann and at the side of Jürgen Fitschen, who should be something like the good face of the bank.
Ackermann, who previously always allowed Jain to do his thing, is said to have spoken out against him and for ex-Bundesbank President Axel Weber as his successor. However, even Josef Ackermann was unable to assert himself against “Anshus Army”: Jain’s power base, followers from trade, who were primarily thinking about the next bonus check, threatened to leave the bank and take the proceeds with them. They practically elevated Jain to the top post.
And Paul Achleitner, who became head of the supervisory board at the same time? He held his hand over the bloated investment banking as requested. And instead of investing enough in the ailing IT and making the bank weatherproof for the stricter requirements of the regulatory authorities, Jain and Achleitner put the billions from a capital increase in the futile fight for market share on Wall Street.
And wasn’t Jain the best at dealing with the financial crisis?
Jain is already learning German, let the bank’s PR people spread the word early on, and is moving to Frankfurt. He came across as friendly, wore a backpack, which was supposed to demonstrate his down-to-earthness. In interviews he described his frugal lifestyle: Contrary to the cliché, Jain didn’t care much for luxury and ostentation.
And wasn’t he, the purified man, actually the best at dealing with the financial crisis? Because he knew where the rubbish was buried? A terrific misjudgement, as was shown shortly thereafter. Or an instrument of power. “Anshu did everything for Paul because he knew Paul could raise or lower his thumb at any time,” recalls a veteran Deutschbanker who knew Jain well.
The fact that Achleitner absolved Jain’s leadership of responsibility in the interest rate manipulation scandal far too early aroused the suspicions of financial regulators. In May 2015, Bafin supervisor Frauke Menke wrote to the supervisory board with an unusually clear reckoning with Jain and numerous colleagues on the board that they had looked away from the Libor manipulation for far too long. When it came out that the bank was involved in money laundering in Russia until 2015, the leadership was no longer tenable. Not only the supervisor, but also important shareholders demanded that Achleitner replace Jain. “He was shocked because the general meeting showed him that his time at Deutsche Bank was up,” recalls one member of the supervisory board. After that, Jain couldn’t really gain a foothold. As “President” he ran the business at Cantor Fitzgerald, a brokerage house from the USA, but rather one from the second row.
In 2017 he was diagnosed with cancer. After a long illness, Jain died on August 13 at the age of 59. His successor, Christian Sewing, praised Jain as a “passionate and intellectually brilliant manager” who impressed many with his energy and loyalty to Deutsche Bank. “Our thoughts and condolences go out to his wife, children and mother.”