Total cost cuts will run to EUR688 million, or a quarter of expenses at 2001, under a new 'cost-offensive-plus' programme outlined by Commerzbank chairman Klaus-Peter Muller.

The information technology department is one of the primary victims of the cost-reduction programme, with half of the job cuts coming from central staffing in Germany, including IT, other back office departments and HQ services. Overseas branches and subsidiaries will cut another 1100 jobs. Five hundred additional job cuts are now being negotiated or are already completed, especially in investment banking.

Under the changes, Andreas de Maiziere, previously in charge of corporate customers, has been handed responsibility for IT, operations, transaction banking, branch organisation and personnel. Part of his brief will be to oversee a slimming down of the department and a prioritisation of projects as budget cuts take effect.

In January, Commerzbank confirmed that it was in negotiations with IBM to outsource back office IT systems within its investment banking operations.