(Bloomberg) -- Deutsche Bank AG said “far-reaching changes” are needed, including significant cuts to its investment bank, as Chief Executive Officer Christian Sewing seeks to win back investor confidence following the breakdown of takeover talks with Commerzbank AG.

“I can assure you: we are prepared to make tough cutbacks” to the investment bank, Sewing said Thursday in prepared remarks at the bank’s annual shareholders’ meeting in Frankfurt. “We will accelerate transformation by rigorously focusing our bank on profitable and growing businesses which are particularly relevant for our clients.”

Sewing didn’t say where those cuts would be, but he highlighted businesses where they’re unlikely to happen, such as origination and advisory as well as as foreign exchange, global credit trading and U.S. commercial real estate. He didn’t mention the equities business, an omission that was intentional, according to a person familiar with the matter.

The CEO has sped up cuts to the struggling investment banking unit since taking over last year, but the measures have failed to lift the stock. Encouraged by the German finance minister, Sewing explored a merger with Commerzbank AG to end what Deutsche Bank has called a “vicious circle” of declining revenue, sticky expenses, a lowered credit rating and rising funding costs, but the talks collapsed last month.

Shares of the Germany’s largest lender fell to a fresh record low before the speech, declining as much as 4% in Frankfurt. They have slumped more than 40% in the past year.

Several large investors as well as analysts have long called for stronger cuts to the investment bank, which consumes most of the bank’s capital but hardly makes a profit. New regulations after the financial crisis have made the business costlier to conduct, while negative interest rates in Europe erode other sources of income.

Under Chairman Paul Achleitner, Deutsche Bank has made a series of cutbacks to parts of the investment bank, while trying to maintain the core business. That left the firm with nine straight quarters of declining revenue, and has done little to reduce elevated funding costs.

Achleitner, in a separate speech prepared for the meeting, said Sewing has the full support of the board of directors for his measures. The chairman last year installed the CEO after a bitter boardroom battle.

The chairman has come under increasing criticism for his oversight of the bank, whose shares have lost about three quarters of their value under his watch.

To contact the reporter on this story: Steven Arons in Frankfurt at sarons@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Christian Baumgaertel

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