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Today's Deutsche Bank report shows that in the second quarter of this year, pre-tax profit amounted to € 408 million, which is 67% less than in the second quarter of the previous year. Net profit for the quarter was € 20 million, which is 98% less than the year before. The bank noted that earnings have been significantly impacted by write-offs and costs of litigation. Write-downs of assets value during just one last quarter amounted to € 285 million, restructuring costs – to € 207 million, and costs of the proceedings - to € 120 million. Total bank revenues decreased by 20% to € 7.4 bln.
The bank’s new CEO, John Cryan commented on results of the second quarter: "Although our results show that we are still in a state of long-term restructuring, we are pleased with the progress. We continue to clean up our balance sheet from risky assets in order to invest in promising areas and to upgrade the infrastructure. However, due to the current difficult economic situation, we need to more actively move in the direction that we have chosen."
The ongoing crisis in the Deutsche Bank has been caused by a number of reasons. The problems began during the European debt crisis, which significantly affected Deutsche Bank’s value of assets, related to Italy and Spain. In 2015, the bank paid a fine of $ 2.5 billion to US and British regulators for a fraud with LIBOR rate. The same year brought another $ 260 million-worth fine imposed by the US authorities for violation of US sanctions against Myanmar, Libya, Sudan, Iran and Syria. In addition, the bank is still under suspicion relating to tax dodgers. This year, the bank has allocated to these cost € 5,4 bln. The ongoing problems have caused drop in Deutsche Bank’s shares - they fell by 41.3% since only the beginning of the year. In June, the IMF said that of all the world's major banks, Deutsche Bank is the greatest risk to the global financial system.
source: marketwatch.com
The bank’s new CEO, John Cryan commented on results of the second quarter: "Although our results show that we are still in a state of long-term restructuring, we are pleased with the progress. We continue to clean up our balance sheet from risky assets in order to invest in promising areas and to upgrade the infrastructure. However, due to the current difficult economic situation, we need to more actively move in the direction that we have chosen."
The ongoing crisis in the Deutsche Bank has been caused by a number of reasons. The problems began during the European debt crisis, which significantly affected Deutsche Bank’s value of assets, related to Italy and Spain. In 2015, the bank paid a fine of $ 2.5 billion to US and British regulators for a fraud with LIBOR rate. The same year brought another $ 260 million-worth fine imposed by the US authorities for violation of US sanctions against Myanmar, Libya, Sudan, Iran and Syria. In addition, the bank is still under suspicion relating to tax dodgers. This year, the bank has allocated to these cost € 5,4 bln. The ongoing problems have caused drop in Deutsche Bank’s shares - they fell by 41.3% since only the beginning of the year. In June, the IMF said that of all the world's major banks, Deutsche Bank is the greatest risk to the global financial system.
source: marketwatch.com
