Deutsche Bank to cut 1,900 jobs as profits drop
The bank, which employs nearly 101,000 people, said about 1,500 of the job cuts will be in its corporate banking and securities divisions and in related infrastructure areas. The headcount reduction will contribute some €350 million to an overall target of €3 billion ($3.8 billion) in savings.
Shares in the bank, which had been lower after the earnings report, jumped on the news of the jobs cuts and estimated savings. They were up 3.2 percent at €25.58 by early afternoon in Frankfurt.
In its earnings report, Germany's largest bank said net profit fell to €661 million from €1.233 billion in the same three months a year ago. Income fell at its investment banking division as fewer client companies came to the bank for its services helping them issue shares.
Revenue from trading debt securities — one of the investment categories most affected by the crisis — was down. The company said that was partly due to the company taking "deliberately lower levels of risk" due to subdued trading volumes.
Revenues were down 6 percent to €8.0 billion. A major hit to revenue came at the corporate banking and securities division, where share underwriting and debt trading are located, falling by €451 million to €3.5 billion.
The earnings statement was the first reported under new co-CEOs Anshu Jain and Juergen Fitschen, who took over from Josef Ackermann in May.
"The European sovereign debt crisis continues to weigh on investor confidence and client activity across the bank," it said.
European governments such as Spain and Italy are struggling with high levels of debt, and the prospect they might default or need bailouts has unnerved markets.
The earnings release added detail to an early release of a few numbers last week.