FRANKFURT AM MAIN, April 26 — Germany’s biggest lender Deutsche Bank said today it was sticking to its full-year targets for 2019, a day after reporting stronger first-quarter performance alongside the failure of merger talks with crosstown rival Commerzbank.
The Frankfurt-based financial firm aims to achieve return on equity of “over four percent” over the whole year — although it lifted the measure of profitability to just 1.3 per cent in the first quarter.
Bosses said the result could have been twice as strong if the bank’s full €604 million (RM2.78 billion) of contributions for Germany’s bank rescue fund had not fallen due in the first quarter.
But weak business performance has also contributed to lower profitability at Deutsche, with revenues falling nine percent compared with early 2018, to €6.4 billion.
Looking to the group’s different divisions, revenue at the flagship investment banking unit tumbled 13 per cent, with cutbacks in both its bonds and stocks trading activities making themselves felt.
Meanwhile the private and commercial bank shed five percent and Deutsche’s asset management arm — which was partially floated on the stock market last year — 4 per cent.
In one glimmer of good news, the bank reported cutting costs eight percent, to €5.9 billion, reaping the first benefits of its latest restructuring scheme, announced under newly-installed chief executive Christian Sewing when he took the helm a year ago.
Some 6,000 job cuts have also helped reduce the lender’s outlays.
“Our continued cost discipline helped us to offset lower revenues” in the first quarter, Sewing said in a statement, adding he was “well on track” to hit a full-year reduction target. — AFP