Germany’s largest financial institution, Deutsche Bank, has announced plans to cut 3,500 jobs over the next two years as part of an ongoing cost-reduction initiative. The bank’s CEO, Christian Sewing, stated that cost management is a high priority for the company after experiencing a 16% decline in net earnings, which amounted to 4.2 billion euros in 2023.
The announcement comes after the bank reported a pre-tax profit of nearly 5.7 billion euros, the highest in 16 years. Despite this positive financial outcome, operational expenses in 2023 included significant costs related to restructuring and severance amounting to 566 million euros.
In efforts to improve profitability, Deutsche Bank has initiated a 2.5-billion-euro efficiency push. Additionally, the bank has seen a 6% increase in revenue, reaching 28.9 billion euros, largely attributed to the higher interest rates sanctioned by the European Central Bank.
Looking ahead to 2025, Deutsche Bank has outlined ambitious plans, including targeting revenues of 32 billion euros and aiming to maintain total operational costs at around 20 billion euros. The bank also intends to propose dividends of 0.45 euros per share for 2023, marking a 50% increment from the previous year. Sewing expressed that the bank’s ambition is to pay a dividend of one euro per share for the financial year 2025.
Despite the cost-cutting measures, the announcement has resulted in a positive response from the market, as the bank’s share prices went up by nearly 5% following the news. With continued focus on cost management and operational efficiency, Deutsche Bank is navigating the uncertain economic environment with strategic financial foresight and resilience.
News Highlight :
– Deutsche Bank is cutting 3,500 jobs as part of cost-reduction initiative
– CEO acknowledged the need for cost management and praised company’s performance
– The bank’s financial maneuvering and savings program has led to a pre-tax profit increase
– Plans for 2025 include increased revenue and dividend payout
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– Comprehensive 3-minute summary of Finance Minister Nirmala Sitharaman’s Budget speech available for download
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