Mr Cryan signalled on Wednesday that more cost-cutting would have to be implemented – on top of the measures he has previously announced which have led to thousands of jobs being shed, asset sales and dividends being frozen.
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The lender said some of the declines were rooted in decisions to shrink Deutsche Bank’s global footprint in order to cut risks and leverage and meet tougher regulatory requirements. Deutsche said it expected revenue to pick up in the second half.
“While our results show that we are undergoing a sustained restructuring, we are satisfied with the progress we are making”, Cryan said.
In 2015 the German bank announced plans to cut more than 30,000 jobs over two years as part of a drastic restructuring plan created to save €3.8bn. Then, profit had been 818 million euros.
Deutsche Bank has suffered a huge loss to profits in the second quarter, falling by 98% compared with the same period previous year.
It also hopes to put behind it a probe by European and US regulators into suspicious equities trades in Russian Federation, as well as remaining investigations by the Office of Foreign Assets Control on alleged money laundering, already partly settled.
European Banking Authority stress test results — set for release on Friday — will provide an initial indication of whether Deutsche’s restructuring is convincing regulators.
Barclays analysts have calculated Deutsche’s capital gap is about 7 billion euros and point out that the gap becomes harder to fill as economic conditions deteriorate. However, when markets are choppy, there is uncertainty amongst investors and institutional clients.
Deutsche Bank executives have struggled to reassure investors of the bank’s ability to increase its capital levels and pay coupons on certain debt securities.
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Deutsche Bank’s DB, -1.53% DBK, +1.25% fallen 43% this year, compared with the 27% decline of the Stoxx Europe 600 banks index. Aside from the fact the second-quarter profits were nearly wiped out, the bank’s revenue declined 12% during the quarter.
