[ad_1]
German lender Deutsche Bank has announced a lower than expected net loss of 3.15 billion euros ($ 3.51 billion) for the second quarter of 2019.
Refinitiv badysts have estimated the net loss at 1.7 billion euros for the second quarter, due to the bank's extensive restructuring program announced earlier this month.
The troubled German lender achieved a net profit of 361 million euros for the same quarter of last year, but has since suffered a collapse in share prices and new scandals.
Here are some highlights for the quarter:
- The net business figure reached 6.2 billion euros against 6.59 billion euros a year ago.
- Tier 1 capital ratio of 13.4% vs. 14.7% a year ago
- Substantial strategic transformation expenses of 3.4 billion euros.
Earlier this month, Deutsche Bank announced that it would exit its global equity business and cut 18,000 jobs by 2022. The first managers were senior executives Garth Ritchie, Sylvie Matherat and Frank Strauss, who would leave the bank in the end of the month.
"We have already taken significant steps to implement our Deutsche Bank transformation strategy," said Christian Sewing, CEO of the bank, in a statement.
"These are reflected in our results, a significant portion of our restructuring costs have already been digested in the second quarter, excluding the cost of transformation, the bank would be profitable and, in our more stable operations, revenues were stable or increases."
Deutsche Bank also revealed that more than 900 employees had been informed to date or that their position would be terminated.
He further stated that "excluding strategic transformation expenses, net profit would have been 231 million euros, compared with 401 million euros for the same period last year.
The bank's shares have fallen by more than 30% over the last 12 months, hit by a series of scandals related to historical failures in the fight against money laundering.
Wall Street badysts have expressed skepticism about the prospects that followed the restructuring and asked if it was too radical and ambitious.
The bank expects radical reforms, which also involve the creation of a "bad bank" of € 74 billion, cost € 7.4 billion by 2022. It initially projected a net loss 2.8 billion euros in the second quarter. .
Deutsche Bank chief financial officer James von Moltke told CNBC on Wednesday that the "largest share" of processing costs is now behind the bank, adding that institutional and corporate clients' reactions to restructuring had been "extremely positive".
"The critical point that we have retained is the market, that it is about investors, regulators, rating agencies and, more importantly, customers, consider that the The strategic decisions we have made are good for society, "he told Annette Weisbach of CNBC in Frankfurt.
The lender also expressed concerns about global trade tensions and the impact of persistently low central bank rates. The European Central Bank (ECB) announced Thursday its latest monetary policy decision. ECB President Mario Draghi is generally expected to pave the way for a reduction in the bank's deposit rate or a resumption of quantitative easing (QE).
"If these conditions persist for an extended period and are not offset by adjustments such as the prioritization of banks' holdings of central banks in the Eurosystem, this could have a significant impact on incomes. compared to our current expectations, "Deutsche Bank's results report states.
"Measures taken to offset this tariff impact, such as price changes or the introduction of fees, may not be sufficient to offset this impact.".
Source link
