Deutsche Bank reports first annual profit in four years

3 February, 2019 12:00 AM printer

FRANKFURT AM MAIN: Germany’s biggest lender Deutsche Bank reported Friday a 2018 bottom line in the black for the first time in four years, with a cost-cutting drive delivering results even as revenues fell.

The firm reported 267 million euros ($305 million) net profit, compared with a loss of 751 million in 2017, reports AFP.

The result was short of expectations of 505 million euros from analysts surveyed by Factset.

Pre-tax profits at the financial firm were up eight percent year-on-year, at 1.3 billion euros.

But revenues fell four percent, to 25.3 billion euros, with Deutsche blaming a fourth quarter marked by “challenging financial markets” and “negative” headlines, including a November raid by prosecutors on the bank’s Frankfurt headquarters. Between October and December, the firm reported a net loss of 425 million euros.

Nevertheless, “our return to profitability shows that Deutsche Bank is on the right track,” chief executive Christian Sewing said in a statement, adding that he aims to “grow profitability substantially” in 2019.

Sewing was named CEO in early 2018 after the bank struggled for years to escape financial woes and a thicket of legal entanglements dating back to the years before the 2008 financial crisis.

He has launched a new round of restructuring to focus on home market Germany, cut costs and slash headcount.

Almost 6,000 departures in 2018 brought the payroll down to 91,700, while Deutsche reduced costs five percent, to 23.5 billion euros.

The bank’s turnaround may not be advancing quickly enough for some shareholders and the German government, which has said it wants strong lenders to support the country’s firms in their international business.