(Adds fresh CEO quotes, background, details)
By James Mackenzie
FRANKFURT June 25 (Reuters) - The new head of Germany's Deutsche Bank said he sees no sign of a market recovery but will press on with selling the bank's shareholdings in case a tax on corporate stake sales is reintroduced after September elections.
Deutsche Bank Chief Executive Josef Ackermann said late on Monday the pressure on the bank to cut costs and improve efficiency also meant that it may have to axe more jobs in addition to the 9,200 positions already earmarked to go.
"The way financial markets have been developing and costs have been pressing us, more job cuts cannot be ruled out," Deutsche Bank CEO Josef Ackermann told reporters at a press club dinner in remarks embargoed until Tuesday morning.
Ackermann has set a target of two billion euros ($1.96 billion) in cost cuts over the next 18 months and has pledged to sell off Deutsche's huge portfolio of stakes in companies like DaimlerChrysler , Continental and Fiat in a drive to lift the bank's market value to join the world's top 10 financial institutions.
Deutsche last week sold its last stake in reinsurer Munich Re even though the stock was at two-year lows and Ackermann said the chance a new government may reintroduce capital gains tax on corporate share holdings after elections in September meant it had to move fast.
"I think the markets would have little sympathy for us if we did not use this window intelligently," he said.
The opposition Christian Democrats, headed by Bavarian premier Edmund Stoiber, signalled in their election manifesto last month they might reintroduce a tax on profits from the sale of corporate cross shareholdings -- dropped from January 1 this year -- if they win power in the elections.
"I can't rule out the possibility that a tax may come some time after September. I don't want to be hit by that," he said.
Ackermann said Deutsche's commitment to sell the stakes would not be affected by the current unfavourable market conditions which he said showed little sign of improving soon.
"We cannot wait for the markets to improve," he said. "We are preparing for a fairly difficult scenario."
BACK TO BASICS
Thw Swiss-born Ackermann repeated the message he has been giving to investors since taking over as chief executive a month ago, saying the bank was focusing purely on improving efficiency and would not be making any new strategic moves or acquisitions.
"At the moment, that is not what anyone wants to hear from Deutsche Bank," he said. "There is a very simple message and that is to improve profitability."
However he said Deutsche may buy a small private bank to improve its private banking business for rich clients.
Ackermann has pledged to revamp Deutsche's private and small corporate client business and sell non-core activities and has insisted that the main priority is to improve efficiency and boost the bank's market value so that it can play a leading part in future consolidation of the industry.
"What would really be worrying would be if Deutsche Bank, as Germany's biggest bank, were not in a position to play a leading role in this," he said.
He said the bank's current market capitalisation, around 42 billion euros according to Reuters figures, meant that it would not be immune from takeover offers but he said this was not management's main concern at the moment.