UPDATE 2-Deutsche plans separate 'corporate bank' in multi-billion dollar revamp

Tom Sims and Hans Seidenstuecker


* Measure is part of multi-billion dollar overhaul

* Bank discussing up to 20,000 job cuts

* Board expected to meet Sunday to study measures (Releads, adds details)

FRANKFURT, July 5 (Reuters) - Deutsche Bank plans to create a separate "corporate bank" to streamline services now spread across Germany's biggest bank as part of wider multi-billion dollar restructuring, two people familiar with the matter said on Friday.

Frankfurt-based Deutsche Bank is planning to announce the overhaul, an effort to reverse its fortunes, in the coming days a month after its shares hit a record low.

Deutsche Bank's supervisory board is expected to meet on Sunday to discuss the restructuring, which could see as many as 20,000 job cuts, with New York and London bearing the brunt.

The lender is still hammering out details on a variety of issues, with the exact makeup of a trimmer management board remains an unanswered question, the people said.

Chief Executive Christian Sewing flagged an extensive revamp in May, promising shareholders "tough cutbacks" to the investment bank after Deutsche Bank failed to agree a merger with cross-town rival Commerzbank.

The overhaul, one of several in recent years, signals that Deutsche Bank is coming to terms with its failure to keep pace with Wall Street's big hitters such as JP Morgan and Goldman Sachs.

Among other measures the bank is examining is the creation of a so-called bad bank to hold tens of billions of euros of non-core assets.

Also, Sewing wants to reduce the size of the bank's nine-member management board, people have said. The bank is still haggling over the staffing of those seats, a person with knowledge of the matter said on Friday.

The revamp is expected to cost the bank up to 5 billion euros.

Deutsche Bank declined to comment on the plans for a corporate bank division.

Currently, a single corporate customer may have accounts with the private and commercial bank, the transaction bank and the investment bank.

The effort would seek to reduce overlap and the new division would have a seat on the board, the people said, confirming news first reported by the Sueddeutsche newspaper.

The new corporate bank would include the transaction bank, which has been a segment of the investment bank, they said.

The transaction bank provides everyday banking services important for the finances of corporations, such as international payments. Sewing has talked up the unit over the past year as a source of stable revenue.

The investment bank, which has lost revenue and market share over past years, is expected to bear the brunt of the cuts in the overhaul package.

(Reporting by Tom Sims and Hans Seidenstuecker Editing by Michelle Martin and Alexander Smith)