Unlock the digestive of free editor
Roula Khalaf, the FT editor, chooses her favorite stories in this weekly newsletter.
Deutsche Bank reported a decline in profits for the last quarter of 2024 and warned of investors costing this year would be higher than expected, as the German Bank chief pledged to consider the scratch of the weaker businesses to improve performance .
Chief executive Christian Sewing told reporters on Thursday that the bank would discover a new medium -term strategy this year. “We will consider whether we need to redistribute parts of the invested capital or even give up one or the other area to use our capital better elsewhere,” he said, adding that “nothing is out of limits.” Asked which activities could be affected, the sewing refused to provide details.
The net profit attributed to shareholders dropped to € 106 million in the fourth quarter, a decrease of 92 percent in the same period a year earlier and much below the € 380 million expected by analysts. The bank blamed a hit € 329m associated with a long -sold scandal in the Polish housing mortgage market.
Germany’s biggest lender said she had lost her 2024 cost targets after being hit by a sharp increase in judicial charges. Loan losses in the last three months of the year were higher than expected by analysts.
Deutsche said it was now targeting a cost-revenue report-a key landmark with less than 65 percent this year. The new goal is higher than its previous goal of keeping costs below 62.5 percent of the revenue, but would still represent a much better performance than the 76 percent ratio it reached in 2024. early Thursday.
Sewing called 2025 a “calculation year”, adding that the bank wanted to “lay the foundations” to become the “European Champion”.
He said Deutsche was still aiming to generate income of more than € 32BN in 2025, adding that the lender had made a “strong start. This year”.
Sewing said he still had “strong faith” the lender would meet his objective of increasing the return of the tangible capital to more than 10 percent in 2025, as they fell to 4.7 percent last year. Andrew Coombs, Citibank Analyst, wrote that achieving the 10 per cent objective “seems increasingly challenging”. Before Thursday’s results, analysts on average expected a return of 8.9 percent of capital in 2025.
Group income for the last quarter of 2024 increased by 8 percent to € 7.2BN, driven by a 30 percent increase in its investment bank as fixed revenue and coin trade increased. The other two main units of the lender business-the distribution of its corporate customers and the retail wing two suffered a slight decrease from year to year in three months to December.
Sewing said that annual-profits 36 percent year by year to 2.7bn €-were largely declined due to restructuring and legal costs such as a provision up to 1.3bn € for a long trial over the price it paid to buy Outside Postbank Minority shareholders in 2010.
“Now we have placed these heritage issues behind us and so we have significantly reduced the dangers for our bank to move forward,” he said.
The Bank has announced a new stock purchase program of € 750 million and proposed a dividend of € 0.68 per share, from 0.45 € per share for 2023 by raising total payments for 2024 to 2.1bn €.
