Annual balance: Deutsche Bank remains confident despite the drop in profits

Annual balance: Deutsche Bank remains confident despite the drop in profits

Annual balance sheet
Deutsche Bank remains confident despite the drop in profits






Germany’s largest money house made even less earned in 2024 than expected. Above all, an expensive old load clouds the balance sheet. However, the board is already working on new goals for the coming years.

Freie from expensive contaminated sites, Deutsche Bank wants to start again after a new drop in profits. “We are determined and confident that we will achieve more than 10 percent return on equity this year,” emphasizes CEO Christian Sewing. The “very good January” confirms management. Last year the return was not even half as high with 4.7 percent.

According to Sewings, the board of directors is currently working on a plan for the years from 2026 – Working title: “Deutsche Bank 3.0” in order to “make long -term number 1 in Europe”. For example, management sees potential to reduce costs through slimmer hierarchies and more use of artificial intelligence.

In addition, it was important to intervene rigorous “where we are in the resources in business areas that achieve below -average returns,” says Sewing. The bank may have to “even give up one or the other area”. The institute wants to publish details in the course of the year. In 2019, the money house had already said goodbye to the stock trade and the hedge fund business.

Expensive permanent dispute with former Postbank shareholders

In the past year, Germany’s largest money house did worse than expected: the Frankfurt Dax Group earned almost 5.3 billion euros in front of taxes, seven percent less than a year earlier. The surplus attributable to the shareholder even broke up by 36 percent to around 2.7 billion euros. A year earlier, the bank had benefited from one billion -dollar tax effect.

The main cause of the decline in profits is: the compensation of former Postbank shareholders. In addition, foreign currency loans in Poland have negative, where many credit institutions have to compensate their customers for the contracts concluded years ago. For this, Deutsche Bank covered around 300 million euros.

The compensation in the Postbank legal dispute costs 900 million euros. Former Postbank shareholders had sued that Deutsche Bank should have paid them a higher price for their shares years ago. Because the money house actually had control over Postbank before the Bonn institute was taken over by the Bonn Institute in 2010. The Higher Regional Court (OLG) Cologne agreed to the old shareholders.

In total, Deutsche Bank increased costs for legal disputes of 1.7 billion euros last year. From October to December, the result attributable to shareholders due to legal costs, even by 92 percent, collapsed to 106 million euros.

Despite the drop in profits, higher dividends

Deutsche Bank’s shareholders should not retire – on the contrary: the dividend is to be increased from 45 cents to 68 cents per share. In addition, management wants to return 750 million euros to the shareholders via a further buyback of Deutsche-Bank shares.

In addition to the special burdens, Deutsche Bank 2024 was satisfactory. The bank covered a good 1.8 billion euros for impending loans and around 300 million more than in the previous year. At the same time, however, the income – i.e. the total income of the bank – increased by 1.2 billion to just under 30.1 billion euros and more than made up for the higher risk provision. Sewing was confident that in 2025 a further increase in yields will succeed to around 32 billion euros.

The confidence that the ten percent return goal will also be reached justifies the CEO with the elimination of renovation and legal costs: “The balance sheet is very tidy.” The board assumes that the non-operative costs will decrease by two billion euros this year. “We also believe that we saw the highlight of the value corrections on the 2024 loan page,” says Sewing.

Cost goal less ambitious

However, the board, on the other hand, cannot keep its plans to reduce costs. So far, the costs in 2025 should be less than 62.5 percent of the yields. Now it should only be less than 65 percent. Last year, this so-called cost yield relation deteriorated from 75 to 76 cents due to the special loads. Means: To achieve one euro yield, Deutsche Bank had to spend 76 cents.

Deutsche Bank on the annual balance sheet 2024 quarterly results Deutsche Bank Announcements Deutsche Bank Analyst estimates Deutsche-Bank boss Christian Sewing to employees on the annual balance sheet 2024 Information on loans in Poland Sarten results

dpa

Source: Stern

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