Deutsche Bank Misses Q4 Revenue Expectations By 50%, Posts Fifth Consecutive Yearly Loss

Frankfurt-based Deutsche Bank AG DB on Thursday posted its earnings for the fourth quarter and the overall financial year of 2019.

Misses Analyst Estimates

The bank reported a net loss of $5.83 billion (EUR 5.3 billion) for the whole year, about 6% lower than the $5.5 billion consensuses of market analysts polled by Reuters.

It reported a net loss of $1.65 billion (EUR 1 billion) for the fourth quarter alone, missing the analyst estimate of $1.1 billion by a whopping 50%.

This is the third consecutive quarterly loss for the bank and the fifth consecutive yearly loss.

Restructure To Blame

The larger-than-expected losses are due to the massive restructuring undertaken by the bank since July last year, it said.

Seventy percent of the costs associated with the overhaul has been realized, the bank said in its earnings report, giving a positive outlook for this year.

The bank said that the 2019 results are in line, or even better, than its expectations for the year, keeping in mind the planned "transformation" set to happen by 2022.

Deutsche Bank is laying off 18,000 of its staff as part of this restructuring, as it seeks to turn profits.

CEO ‘Very Optimistic' For 2020 And Beyond

In a statement, Deutsche Bank CEO Christian Sewing said that he felt "satisfied and positive" in spite of the loss posted for the year.

According to Sewing, the bank has made "major strides" in implementing the overall. "That progress comes at a price, no question..[but] we were expecting this loss. And it shows one thing above all: how much of the transformation of our bank we have achieved in 2019," he said.

"In 2020 we will continue with this implementation: we will continue to cut our costs and shrink the balance sheet of our Capital Release Unit. And at the same time we will shift our focus over to growth. We don't just want to defend our market position; we want to build on it," the CEO noted.

Price Action

Deutsche Bank's shares traded 0.21% higher at $8.81 in Frankfurt at press time on Thursday. The shares were trading 0.8% higher at $8.8 in the pre-market session in New York.

Photo Credit: Public domain photo via Wikimedia.