Most of the writedown is on goodwill, which does not affect the bank’s capital position. “Now it is clear that the bank is not planning a cap hike in the short term,” he added. Now there’s a wind of change,” said one of the bank’s top 10 investors, who asked not to be identified. “Longtime board members often hesitate to do drastic cuts. It has earmarked the two assets for disposal.
It will also take a 3.5 billion euro impairment on its Postbank retail bank and 600 million more on a stake in China’s Hua Xia Bank. It will take a 2.3 billion euro writedown at its investment banking unit, 16 years after acquiring the U.S.
Still, traders and analysts praised Cryan for taking action to tackle long-standing problems, and it also appeared unlikely the bank would have to raise capital soon despite the losses. Its share price has fallen more than 20 percent in the last six months, suffering under stalled reforms and rising costs on top of fines and settlements that have pushed the bank to the bottom of the valuation rankings of global investment banks. Shares in Germany’s flagship lender fell 3 percent at first, but rallied before dipping 0.6 percent to 25.31 euros by 1323 GMT, valuing it at $40 billion. emissions tests.Įurope’s largest economy is already feeling the pain from a slowdown in emerging markets, with exports plunging in August by their largest amount since the 2008-2009 financial crisis. It is another blow to corporate Germany, which has been rocked by a scandal at Volkswagen after the auto-maker admitted to cheating U.S. He warned them bonuses would be cut as staff needed “to share something of the burden” of the losses. “The news is not good, and I expect a number of you will be very disappointed by it,” Cryan, who has a reputation for swift action and straight talk, said in an open letter to staff.
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