Deutsche Bank warns of deeper cuts after revenue drop

Second-quarter revenue down 20 per cent as turnover falls 28 per cent

Deutsche Bank’s net profit dropped to €20 million in the second quarter.

Deutsche Bank’s net profit dropped to €20 million in the second quarter.

 

Deutsche Bank warned that deeper cuts may be needed to turn around the lender after revenue fell sharply in the second quarter as the low interest rate environment and volatile markets weighed on the business.

“If the current weak economic environment persists, we will need to be yet more ambitious in the timing and intensity of our restructuring,” chief executive John Cryan said in a statement on Wednesday.

Shares were indicated to start trading 2.3 per cent higher at the top of Germany’s blue-chip DAX index.

Profit

Net profit dropped to €20 million in the second quarter, but was ahead of analysts’ consensus for a net loss of €105 million.

Revenue was down 20 per cent in the quarter, in part related to Britain’s vote to leave the European Union, with the investment bank sliding 28 per cent.

Deutsche Bank’s cash-cow bond-trading activities decreased 19 per cent, which it said was related to its decision to exit high-risk securitised trading and the rationalisation of its emerging-market debt platform.

Revenue from its foreign exchange business was flat, helped by a burst in client demand for currencies in the wake of the Brexit vote. – (Reuters)