BCN-10 Deutsche Bank says big-bang restructuring on track

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GERMANY-ECONOMY-EARNINGS-DEUTSCHEBANK

Deutsche Bank says big-bang restructuring on track

FRANKFURT AM MAIN, July 25, 2018 (BSS/AFP) – Germany’s biggest lender
Deutsche Bank said Wednesday a major restructuring under its new chief
executive was in full swing, as it confirmed second-quarter profits that beat
analysts’ previous expectations.

Net profits reached 401 million euros ($468 million) on the back of 6.6
billion euros in revenue, in line with preliminary figures the lender
released earlier this month.

Analysts surveyed by data company Factset had earlier forecast profits of
around 120 million euros.

But the result was still 14 percent lower than last year’s second-quarter
earnings of 466 million euros.

“We accelerated the reshaping of our bank significantly and proved the
resilience of our global business” between April and June, said CEO Christian
Sewing, who took over from crisis firefighter John Cryan in April with
promises of a far-reaching shakeup.

Deutsche highlighted some 239 million euros in costs for restructuring and
employee severance — twice as much as the same quarter last year — as
around 1,700 workers left.

It added that it was “on track” to slash another 1,500 from its total
headcount to dip below 93,000 by the end of the year, with a further ambition
to shrink “well below” 90,000 by the end of 2019.

Meanwhile it finished integrating of subsidiary Postbank into its retail
banking division in May.

And in its investment banking division, Deutsche reported “substantial”
reductions in “leveraged” — or borrowing-fuelled — holdings of stocks and
bonds, accounting for most of an 85-billion-euro reduction in such exposures
across the bank.

There was slower progress on cutting costs, which fell 1.0 percent to 5.6
billion euros in adjusted terms in the second quarter.

But executives said they remained committed to reducing outlays from last
year’s 23.8 billion euros to 23 billion in 2018.

BSS/AFP/MR/ 1210 hrs