The announcement follows a big write-down driven by capital requirements and the disposal of its Postbank unit, according to a company statement.
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Separately, TheStreet Ratings team rates DEUTSCHE BANK AG as a Sell with a ratings score of D+.
The bank has been dogged by legal woes, including investigations into possible manipulation of benchmark currency rates and dealings with Iran.
While the losses and charges involve litigation expenses, it turns out that things may be so bad that Deutsche Bank’s dividend may be reduced or eliminated for the rest of this year. The bank expected that majority of the amount are not tax deductible.
As in the second quarter, the bank is setting aside another 1.2 billion euros for fines and settlements, adding that further events could affect final litigation provisions for the third quarter.
Cryan, however, is unlikely to present “big bang” reforms on October 29, when the bank reports results and plans to provide more details of its so-called Strategy 2020.
Deutsche Bank’s ADSs trade on the New York Stock Exchange and closed up 1.4% at $28.79, against a 52-week range of $26.04 to $36.21. This reflects anupdated valuation triggered by a change of the intent of the holding asDeutsche Bank no longer considers this stake to be strategic. Its shares were down about 6% in after-hours trading.
Deutsche Bank estimated an IBIT loss of approximately €3.3 billion and a net loss of €4.8 billion year-to-date through the third quarter.
Deutsche Bank has signaled plans to pull operations out of a few countries and last month announced that it would close its investment-banking business in Russian Federation, where it has suffered from decreasing profits and issues monitoring compliance. By our view, that is code for “there could be more before this is all said and done”.
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In a memo to employees posted on the bank’s website Wednesday night, reminded employees of his note to them his first day on the job in July, when he warned them not to expect “sweetness and light”.
