The chief executives of the bank have long occupied a lofty place in Germany, enjoying the eager company of chancellors, industry titans and kaisers.
Deutsche Bank is as German as lederhosen, sauerkraut, beer and the Autobahn.
Franklin Allen, professor of finance and economics at Wharton, University of Pennsylvania, told Reuters: "There is the political dimension which is arguably the most important part of what they do now, particularly in Germany. Deutsche Bank is a special case. It is an icon, a national champion."
Thus, Jain will be under extreme pressure to maintain the bank's close ties with the highest levers of power in the Reichstag.
"The position of CEO of Deutsche Bank has always had a political dimension," Ackermann -- who is close to Chancellor Angela Merkel – once told Reuters.
Aside from mastering German politics, Jain will also have to deliver profits in an increasingly difficult environment for European banks.
Although Deutsche Bank dabbled in subprime mortgages, the bank emerged largely unscathed from the global financial crisis of 2007-2009. Moreover, unlike most of its global peers, Deutsche Bank has not enacted significant layoffs.
Still, given the new regulatory scrutiny of major banks by recession-weary governments, Deutsche Bank may not enjoy the good relations with politicians it has historically counted on.
"The interests of banks and politicians have diverged, with banks seeking to preserve the same level of profitability and pay, and politicians demanding banks shrink," Wharton's Allen said.
"Banks will try to maintain profit levels either by taking on greater levels of risk, or by growing in size through market share gains and economies of scale. Both of these trends are at odds with current politics."
Now, by introducing an Indian man like Jain as its boss, will Deutsche Bank continue to thrive?
Ackermann, a Swiss native, was the first non-German to ever helm Deutsche Bank (although Switzerland and Germany share similar languages and culture).
The potential emergence of Jain presents a whole new chapter in the bank's glorious history – and perhaps reflects the reality of the integrated, global marketplace in the 21st century.
Anna N. Danielova, assistant professor of finance at the DeGroote School of Business in Hamilton, Ontario, noted that Deutsche Bank is a somewhat “untypical” global bank.
“On the one hand, two-thirds of its work force is outside of the country,” she said.
“Deutsche Bank is currently doing business in nearly 75 countries all over the world; and about 54 percent of Deutsche Bank's shareholders are based outside Germany. It emphasizes its global outreach on its website. Yet, what makes it different from other financial institutions is that it [still] carries the name of the country [it is based in].”
Indeed, nationalism is a touchy subject whenever Germany is concerned, to put it mildly. The formation of the euro-zone economic bloc has done little to erase the rivalries and historic enmities between several European countries. Pockets of resentment against Germany remain strong, particularly in Greece, where Merkel has repeatedly been slandered as a "nazi."
Thus, if Deutsche Bank is still considered a “German” institution, must it have a German leader?
“Perhaps there could be some discomfort around the decision to put Jain at the head of the company as co-CEO, but I do not expect more than that,” Danielova opined.
“First, if there were to be a backlash it should have already happened by now. This is not 'new' news. The rumors about Jain one day heading Deutsche Bank surfaced way back in 2010. It was suggested that he would become co-CEO in July 2011. Apparently, he started learning the German language around this time.”
Danielova also points out that non-German-born CEOs are already increasingly running German-based companies.
“Deutsche Bank is unique,” she noted. “It is indispensable for Germany, and yet it also outgrew the country long ago.”
In 2010, nine of the country's 30 biggest public companies were led by non-Germans, including two – software giant SAP AG (American Bill McDermott) and Fresenius Medical Care (American Ben Lipps) -- who speak little German.
Knowledge of German may no longer even be a prerequisite for running a German corporation.
“Perhaps in recognition of, or as a consequence, of its global outreach, the working language of Deutsche Bank's management board is English, which also has been the company's official language since the $9 billion takeover of New York-based Bankers Trust in 1999,” Danielova added.
Moreover, Jain might actually be the perfect candidate for Deutsche Bank’s top job.
“Jain's appointment reflects the reality of an institution that, as a result of massive investments, has become one of the world's largest investment banks,” Danielova said.
“In good years, Jain and his team of fixed traders from all over the world have been responsible for two-thirds of the bank's total profits. Not offering Jain the top job was risking driving out the 'best candidate' and disappointing analysts and investors.”
With respect to Deutsche Bank’s new dual-CEO arrangement, Danielova concedes it has some risks, but makes sense in the current environment since, among other factors, Jain needs time to develop close relations with German politicians and top business executives.
“As with any dual leadership structure, it is pragmatic, but bears risks,” she said.
In the event Jain takes sole possession of Deutsche Bank’s top position, there is likely to be a drop-off in terms of the bank's relationship with German lawmakers -- and this is where Fitschen where will play a crucial role.
“This is one of the responsibilities of Fitschen, to make sure this particular relationship stays intact,” Danielova declared.
“He is not unfamiliar with the German political establishment. Having him as co-CEO would also provide Jain with the opportunity to develop on his own. Also, it seems that Jain brings valuable connections of his own: for example, it has been said that he has contacts with both George Soros and Warren Buffett.”
Still, among the 10 largest banks in Europe by asset size, only Barclays Bank of Britain has a boss not born in the country of the company's origin (Bob Diamond, an American).
This is not, however, necessarily due to any official corporate policies that discriminate against hiring non-natives. Indeed, in some cases, particularly with Asian companies, there are cultural and language obstacles that preclude the naming of foreigners to top executive positions.
“I know only of one Asian country that now has an official ban on foreign CEOs,” said Danielova, referring to Indonesia, where the rule went into effect Feb. 29.
“Indonesia has banned foreigners from holding the post of chief executive officer and human resources (HR)-related positions at local firms. The rule would be limited to wholly owned local companies and would not apply to foreign-owned companies.”
At any rate, an Indian taking over a prominent German company simply is a testament to a globalized economy.
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