Deutsche Bank says big-bang restructuring on track

Deutsche Bank’s net profits reached €401 million on the back of €6.6 billion in revenue. (AFP)
Updated 25 July 2018
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Deutsche Bank says big-bang restructuring on track

  • Analysts surveyed by data company Factset had earlier forecast profits of around €120 million
  • It finished integrating of subsidiary Postbank into its retail banking division in May

FRANKFURT: Germany’s biggest lender Deutsche Bank said Wednesday a major restructuring under its new chief executive was in full swing, as it confirmed second-quarter profits that beat analysts’ previous expectations.
Net profits reached €401 million ($468 million) on the back of €6.6 billion in revenue, in line with preliminary figures the lender released earlier this month.
Analysts surveyed by data company Factset had earlier forecast profits of around €120 million.
But the result was still 14 percent lower than last year’s second-quarter earnings of €466 million.
“We accelerated the reshaping of our bank significantly and proved the resilience of our global business” between April and June, said CEO Christian Sewing, who took over from crisis firefighter John Cryan in April with promises of a far-reaching shakeup.
Deutsche highlighted some €239 million in costs for restructuring and employee severance — twice as much as the same quarter last year — as around 1,700 workers left.
It added that it was “on track” to slash another 1,500 from its total headcount to dip below 93,000 by the end of the year, with a further ambition to shrink “well below” 90,000 by the end of 2019.
Meanwhile it finished integrating of subsidiary Postbank into its retail banking division in May.
And in its investment banking division, Deutsche reported “substantial” reductions in “leveraged” — or borrowing-fueled — holdings of stocks and bonds, accounting for most of an €85-billion reduction in such exposures across the bank.
There was slower progress on cutting costs, which fell 1.0 percent to €5.6 billion in adjusted terms in the second quarter.
But executives said they remained committed to reducing outlays from last year’s €23.8 billion to €23 billion in 2018.


British Airways launches first direct flight from Dammam to London

Updated 22 min ago
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British Airways launches first direct flight from Dammam to London

  • Flights will be operated by a four-class Boeing 777-200 departing year-round
  • Dammam will become the third route the airline flies to in Saudi Arabia

LONDON: British Airways has launched the first ever direct flight from Dammam to London Heathrow.
The carrier has already started selling tickets priced from SR2,480 ($660) for the new route which will start Dec. 1, 2019.
Flights will be operated by a four-class Boeing 777-200 departing year-round from Dammam’s King Fahd International Airport and landing in Terminal 5 at London Heathrow, British Airways said in a statement on Tuesday.
Dammam will become the third route the airline flies to in Saudi Arabia after Riyadh and Jeddah.
“This new link between Dammam and London underlines the importance of the Eastern province and the need for smooth onward connections to Europe and the United States, said Moran Birger, BA head of sales for the Middle East and Asia Pacific.
It will cut journey times between the two airports by three hours or more because passengers will no longer need to either drive to Bahrain or transit through Riyadh for a connecting flight, the airline said.