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Deutsche Bank pledges to boost dividend and cut jobs

Germany’s biggest bank plans to lift shareholder returns even as quarterly profits slide

Deutsche Bank set out plans to boost a share price that has languished over the past year. The bank employs about 200 people in Dublin. Photograph: Kirill Kudryavtsev/Getty

Olaf Storbeck
Thu Feb 1 2024 - 11:46

Deutsche Bank has set out plans to triple its dividend, buy back more shares and cut jobs as Germany’s biggest bank tries to boost a share price that has languished over the past year. The bank employs about 200 people in Dublin

The bank said on Thursday that it wanted to “accelerate” its payouts to shareholders and was on track to beat a target of returning €8 billion by 2025.

The pledge came despite a 30 per cent drop in profits during the fourth quarter when the bank was stung by a higher tax bill and a larger provision for loan losses as Germany’s economy slowed.

Deutsche made €1.26 billion in net income in the final quarter of the year, down from €1.8 billion in the year-earlier period. Revenues and costs both climbed 5 per cent in the period.

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As the windfall from higher interest rates begins to recede, the bank has also said it will cut 3,500 jobs by 2025 after its staff numbers have risen by more than 5,000 in the past 12 months.

The increase took the bank’s workforce back above the 90,000 mark for the first time since chief executive Christian Sewing embarked on a large restructuring in 2019. Most of the positions to be eliminated would be non-client-facing ones, Deutsche added.

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Deutsche shares were up 4.3 per cent in early trading on Thursday. Before today, the stock had fallen 2 per cent over the past 12 months.

As part of its plan to boost shareholder returns, Deutsche said it would lift its dividend by 50 per cent to €0.45 a share this year and vowed to push the payout to €1 a share by 2025.

The bank also promised to buy back another €675m of shares over the next five months after receiving regulatory approval, following a €450m share buyback in 2023. — Copyright The Financial Times Limited 2024

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