Deutsche Bank finally has a successor to CEO Josef Ackermann, who now can finally retire - so to speak.  Starting in 2012, subject to shareholder approval, the bank will adopt a dual leadership structure - Anshu Jain, head of its investment bank, and Jürgen Fitschen, head of the German unit, will share CEO duties.  Mr. Josef Ackermann, 63, has agreed to stay on and become chairman of the supervisory board.

The succession debate had raged for quite awhile.  Investors favored Mr. Jain, whose banking unit has generated tremendous profits.  Yet, detractors regarded Mr. Jain, a native of India who's not fluent in German, as not ready to assume the statesmanlike duties expected of the head of an institution that holds a prominent place in the nation’s identity.

For example, CEO Ackermann also serves as chairman of the Institute of International Finance, whose members include most large international banks.  The institute represented banks and insurance companies in negotiations that led to the Greece rescue package. 

As supervisory board chairman, Mr. Ackermann will be able to continue to serve banking interests as someone who has the ear and respect of people like Angela Merkel, chancellor of Germany.  Mr. Jain  can also expect to receive some help from Mr. Fitschen, 62, who's expected to help overcome reservations by Deutsche Bank staff members about Mr. Jain, 48.  German employee representatives make up half the 20 members of the supervisory board and thus have a strong say in the decision. 

Interestingly, Mr. Jain appears to have the longer future with the bank.  He will receive a contract that runs until 2017, while Mr. Fitschen’s contract will run until 2015.  That would suggest Mr. Fitschen is likely to serve as a transitional figure while Mr. Jain learns more about Deutsche Bank’s other businesses, at which point he could become sole chief executive.

Not a Slam Dunk.   The plan may draw criticism from corporate governance advocates, who argue that chief executives may not be able to make necessary changes if watched over by their predecessors. German law discourages chief executives from becoming chairmen, requiring approval by 25% of shareholders for such a change.

Mr. Jain came to Deutsche Bank in 1995 as one of scores of investment bankers who followed Edson Mitchell from Merrill Lynch, vastly expanding the bank’s revenue from activities like trading and deal-making.  After Mr. Mitchell died in a plane crash in 2000, Mr. Jain succeeded him.  Under his leadership, Deutsche Bank has moved into the top ranks of global finance, and is able to hold its own against the likes of Goldman Sachs and JPMorgan Chase.

Mr. Jain, who has been based in London along with most investment banking operations, sometimes seemed slightly out of place in Frankfurt, wearing an earphone at the annual meeting to hear a translation of the proceedings.  But investors feared that he might leave the bank if he did not get the top job.

Mr. Fitschen is less well known outside the bank. His title is head of regional management worldwide as well as chief executive in Germany, jobs that are more supervisory than operational. But Mr. Fitschen is well connected in Germany, sitting on the boards of several large companies, including Metro, the country’s largest retailer.   [Dealbook, 7/25/11]