Sunday, 18 April 2021

Deutsche Bank bigger than forecast quarterly loss

Reuters

FRANKFURT: Deutsche Bank reported a bigger than forecast quarterly loss of 3.15 billion euros ($3.5 billion) because of major costs stemming from its efforts to reshape its business.

Deutsche Bank had earlier this month flagged it would lose around 2.8 billion euros in the quarter when it announced a restructuring plan that will see 18,000 jobs go and cost 7.4 billion euros overall.

The second-quarter loss compared with a profit of 401 million euros a year earlier. The bank’s shares dropped 5pc in early Frankfurt trading.

Deutsche, Germany’s largest lender, is considered one of the most important banks for the global financial system, along with US heavyweights JPMorgan Chase, Bank of America and Citigroup.

But Deutsche has been plagued by losses and scandal, prompting it to embark on one of the biggest overhauls to an investment bank since the aftermath of the financial crisis.

Chief Executive Officer Christian Sewing said on Wednesday that the bank had already taken significant steps in implementing the strategy. More than 900 employees had given notice or been told they would be made redundant.

In a note to employees, Sewing said that the lender’s underperforming investment bank faced “strong headwinds” in the quarter, including questions about the bank’s future that spooked clients.

“Now we can look ahead with more optimism,” he wrote.

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