Deutsche Bank warns of material impact from coronavirus pandemic
Deutsche Bank has warned that the economic fallout from the coronavirus pandemic may affect its ability to meet financial targets as the lender undergoes a radial overhaul following years of losses.
The warning is the first time Germany’s largest bank has publicly expressed concerns over the impact of the outbreak, which has disrupted Deutsche’s operations by causing it to split teams and cancel events across the world.
The lender’s shares have fallen to a record low amid the global stock market rout caused by the virus.
Deutsche Bank said today that the forecasts in its annual report didn’t factor in the impact of Covid-19, and that it would provide an outlook update next month when it reports first quarter earnings.
Chief executive Christian Sewing has been leading a dramatic turnaround €7.4bn (£6.7bn) effort involving the cutting of 18,000 jobs to increase the lender’s focus on corporate banking and slim down its investment banking arm.
The bank posted a €5.7bn loss for 2019, its fifth in a row, as the cost of its extensive turnaround efforts hit earnings.
Deutsche Bank also announced today that Deutsche Boerse boss Theodor Weimer would be nominated to its supervisory board.
“We will gain an expert with deep knowledge of the German and European financial industry as well as an outstanding banker,” said Deutsche chairman Paul Achleitner.
The appointment makes Weimer a leading candidate in the race to succeed Achleitner, although he would not be in a position to take up the role soon as he has just extended his tenure as head of Deutsche Boerse.
Achleitner, who has come under pressure for the poor performance of Deutsche Bank’s shares since he took up his role in 2012. He is due to finish his term in 2022.
A Deutsche Boerse spokesperson said Weimer will join the bank “as a normal member of the supervisory board”.