Deutsche Bank will cut ties with about 3,400 clients in its Global Markets division, who are part of its debt and equities sales activities, the German lender revealed in an internal memo on Friday (2 December).

The memo from Dixit Joshi, head at Deutsche's Institutional Client Group for debt trading, said the bank had found clients with whom it was "not strategically viable" for it to "continue to do business". It also said it would hence cease debt sales services and equity sales activities to these clients.

The move would impact its "actively-trading" customers such as hedge funds and would have an "immediate effect", The Wall Street Journal reported, citing the memo. These changes were aimed at balancing "risk, revenue and profitability", it added.

The development is said to be part of a broader restructuring programme aimed at saving costs and restoring the long-term stability of the bank. It follows an announcement made by Deutsche Bank CEO John Cryan about a year ago that the bank would cut about 50% of its trading clients in an effort to focus on profitability. He had then said these cuts would be made across its Global Markets and Corporate & Investment Banking divisions.

"We expect to off-board about half of the current list of clients as the economic returns in these relationships are inadequate to us," he had said, according to Reuters. Cryan is also said to have pointed out that 80% of its investment banking income was earned from just 30% of its clients.

The move also comes at a time when the bank is in discussions with the US Department of Justice (DoJ) to settle its longstanding residential mortgage-backed securities (RMBS) cases. Deutsche Bank was asked in September to pay $14bn (£11bn) by the US DoJ to settle these RMBS claims. The German lender had, however, said it did not intent to settle these claims anywhere near the figure cited.