In a major reorganization, Deutsche Bank has just announced that Jonathan Paul and Lee Zhang have been appointed co-heads of the firm's newly created global banking division for Asia-Pacific. The duo replace Frank Nash, who will retire to the US and Brian Stevenson, who leaves Deutsche at the end of October.

However, this is more than just a changing of the guard. Paul and Zhang's appointment marks a wholesale strategic shift. Paul was formerly chairman of Deutsche Bank's global markets business in the region, while Zhang built and ran Deutsche's China business. The new division they takeover has been reshaped to include transactional banking as well as investment banking products and has around 1000 staff in the region. Here they talk about what it all means:

What's reason for the reorganization?

Jonathan Paul: On the corporate side of the bank we had three businesses: mergers and acquisitions, equity capital markets, and the transaction bank. They are all now coming together in this new global banking division.

This division will be the predominant group covering corporates. Obviously there are some revenue gains that can be made and some cost gains that can be made. But this reorganization is focused primarily on 'revenue growth'.

So this is all about cross-selling?

It is, and the more products you sell, history tell us that the more profitable the client becomes.

Lee Zhang: The name of the game here is cross-selling and gaining synergies. My co-head, Jonathan Paul brings a strong sense of product innovation from his role in global markets and he can bring synergies and introduce a culture and capability to cross-sell among our corporate client base.

Lee, will this mean that you spend less time focusing on China?

Zhang: Timewise, yes. But in terms of overall attention paid to China by the firm, China remains a priority market and we will not lose our focus on that. I think it is positive that a senior member of the platform now has this China background. I can make sure global resources are mobilized to serve our clients in China better.

Paul: The good thing is we have very complimentary skillsets. Between the two of us we cover all the bases. Lee has been involved in large equity and corporate finance transactions at one end of the spectrum, and I have worked in global markets - on fixed income and derivatives transactions and so forth. So between us we can talk to clients we sit down with about any of the products the bank can offer.

I know a lot of firms have combined debt and equity together. But I feel what we are doing in the corporate space is definitely the right model.

Will you go and market to corporates together?

Paul: We are going to be on the road for the next few weeks and go and see all of the major clients together. Then there will have to create some sort of division of responsibilities after that.

As co-heads, will you share an office?

Paul: We are sitting next to each other and that proximity is important.We bring different perspectives. Lee may see a business opportunity in a complementary area to where I will see it. We think we can really generate more revenue from this business.

On the transaction banking side of the business we have 800 people in the region. If you think about that as a resource, and what it can potentially generate - if it is aligned properly with product strengths - that's a huge platform to leverage.

Does that require changing the "software" of those 800 people to make them able to talk about other products?

Zhang: The key is to let the clients' have the access to the whole spectrum of Deutsche Bank's capabilities - from strategic M&A to cash management and trade finance. The salesforce will bring in experts to talk with the clients. But the key is to present it as one big interface, with the technical excellence beneath. But we all need to learn. On the corporate finance side, we need to understand the cash management products better for example.

Will you be changing the compensation structure to incentivize the relationship managers to cross-sell?

Zhang: We always reward people who are top performers. They will never worry about their pay. I like to say our highest paid people are the cheapest people because they produce a lot.

Paul: In practical terms, Michael Cohrs and Anshu Jain share a bonus pool at the top of the firm - so their interests are aligned. Their job is to maximize the profitability of corporate banking and securities. So if we do something that doesn't have a pay-off for our division, but pays off in equity trading, that's a good thing for the P&L at the top level. Because those interests are aligned it is much easier to pay people well. People will be skeptical but we have to demonstrate we have the ability to direct compensation where appropriate. We will not hesitate to reward a transaction banker who does something that pays off in another part of the firm. We're all shareholders of this firm, and as managers must think of the greater good of the firm.

The challenge must be to create the entrepreneurial customer-facing layer that can listen, and figure out which products the customer will buy?

Paul: That is true and I can't say we have done a full audit on all the coverage people and the quality yet. But certainly the buy-in from the group heads we have spoken to is very, very high. But it will be key to have just those sort of people, who have that sort of radar, and by listening it might lead to an equity derivative or a hedging transaction, or a block trade.

Has any bank in your peer group in Asia got this right yet?

Paul: Very few. The question is can the banks with large Asian footprints like us do it? That's obviously our challenge.

Zhang: One-stop shopping, cross-selling, synergies. They are all buzzwords that almost every bank talks about. I don't think our aims are greatly different to our competitors. But I think we have been very good at executing our strategy. We've developed strongly in the last three years in particular in all our businesses.We have a lot of determination; and the determination in the bank to get this right is immense. That's why Jonathan Paul and I have been empowered to make this go through. Are we going to be successful? That's what we are here for.

Lee, you have built your China franchise from being pretty much a blank piece of paper three years ago to being pretty successful. Have you been able to implement a cross-sell strategy within country?

Zhang: Yes, but less than I would hope for. With some clients we are doing M&A, derivatives, bonds and hedging. We're also doing cash management and trade finance. But many of the PRC clients are not at the level where they will use so many products. In other markets they are at that level. That's why the opportunity is huge.

If you do get it right, what's your vision of how much you can grow revenues in the next five years?

Paul: Five years is a long time. We would be bold to project that far.

Zhang: We think we can increase the number of clients we cross sell to by 20% in one year as a minimum.

Paul: We need to have that sort of impact. And I bet we don't even need to build any new relationships. We probably have all the relationships we need, but just need to better deliver the firm. And a bit of luck. You always need a bit of luck.