Crisis-plagued Deutsche Bank has insisted the worse of its troubles are over even as it announced a net loss of 1.9 billion euros for the final three months of last year due to legal costs for past misdeeds.
The financial markets were not convinced and the shares of Germany’s biggest bank fell as much as seven percent at one stage, ending the day down close to five percent.
Chief Executive John Cryan asked investors to be patient saying it had been “a year in which we achieved a great deal. However, we are only beginning to see these achievements reflected in the financial results”.
Of the past year the CEO said: “I do not want to beat about the bush; there were times in 2016 when we were under immense pressure. This was especially true in the autumn, when the US Department of Justice’s demand of 14 billion dollars became public knowledge.
“The result was weeks of debate and speculation on what a settlement of this size would mean for Deutsche Bank – although we never assumed that we would actually have to pay an amount that high.”
John Cryan: We got off to a promising start to the year. In key areas of our bank, business is distinctly better than a year earlier.— Deutsche Bank (@DeutscheBank) February 2, 2017
Lot of promise
The loss for all of 2016 was 1.4 billion euros, but Cryan said the bank has shown its resilience and should return to profit this year: “For us, 2017 began with a lot of promise. In key areas, our business is operating distinctly better than in the previous year, for example in our capital markets business. We are gaining additional momentum from the fact that we were able to put additional litigation matters behind us.”
Cryan is trying to regain the trust of investors and customers as he moves to slash costs by cutting staff and overheads and selling off non-core businesses.
Deutsche Bank has drawn a line under some major legal headaches but is facing new civil lawsuits, forcing it to put aside even more money for possible future legal settlements.