Deutsche Bank Backs Idea For Stronger Banking Union

Deutsche Bank Backs Proposal To Fortify Banking Union

Deutsche Bank Deputy Chief Executive Officer Karl von Rohr said the bank welcomes a finance ministry proposal from Germany that would strengthen the European banking union, according to a report by Reuters.

Rohr was speaking at a conference for banking in Frankfurt, and he said he hopes the proposal “receives a good hearing in Brussels.”

The news comes as the bank reported a net loss below market expectations amid a restructuring plan that includes about 18,000 layoffs.

The lender reported a net loss of $924 million (832 million euros) for the third quarter of 2019. This is the second quarterly loss for Deutsche Bank, which triggered a 7.9 percent drop in the closing share price. Fixed-income trading declined 13 percent.

Analysts were expecting a loss of $865 million (778 million euros), according to data from Refinitiv. Corporate bank revenue saw a 6 percent increase, including an 8 percent uptick in transaction-banking revenue.

The restructuring has Deutsche Bank leaving equities trading along with other operations that aren’t profitable. Its goal is to focus on long-term strengths.

CEO Christian Sewing said “the bank’s transformation is on track,” and that ultimately, Deutsche Bank will be leaner and better able to concentrate on servicing its client base. The bank’s core business divisions were all profitable, the bank said.

The bank is also being investigated for not reporting more than a million suspicious bank transfers until February of this year, despite breaking off its relationship with Danske Bank in 2015.

The transfers weren’t reported until five years after they were flagged as suspicious by a whistleblower, Reuters reported, citing an unidentified person familiar with the matter.

Investigators in Germany are now trying to figure out whether the transactions were covered up for a reason, and who’s responsible for doing so.

Danske Bank was no longer allowed to operate in Estonia after it admitted that $220 billion of questionable money went through a branch there between the years of 2007 and 2015. Deutsche Bank is involved because it was the one that processed most of the transactions, which led to a raid by German officials last month.



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