- Deutsche Bank posts third consecutive annual loss.
- Shares fall more almost 6%.
- CEO John Cryan cites a “challenging market.”
LONDON – Shares in Deutsche Bank on Friday fell almost 6% after the lender posted its third consecutive annual net loss.
Deutsche Bank, Germany’s largest lender, reported a full year loss of €497 million ($US621 million) for 2017 against analyst consensus forecasts of a €290 million loss, according to nine banks and brokerages surveyed by Reuters.
The bank took a hit from flat markets, falling investment bank revenue and a $US1.8 billion charge from changes to the US tax system.
While Deutsche Bank took an upfront hit from tax reform – having to revalue deferred tax assets – “the reduction in the US federal tax rate is expected to have a positive impact on net income” in the future, the bank said in a statement.
Here’s the chart of Deutsche Bank’s shares in pre-market trading in New York. The firm’s Frankfurt listed shares were down close to 6% as of 10.00 a.m. GMT (5.00 a.m. ET):
Tax proved the bank’s undoing in 2017. Deutsche Bank did post a pre-tax profit of €1.3 billion, its first in three years.
CEO John Cryan said: “In 2017 we recorded the first pre-tax profit in three years despite a challenging market environment, low interest rates and further investments in technology and controls. Only a charge related to US tax reform at the end of the year meant that we had to post a full-year after-tax loss.”
“We believe we are firmly on the path to producing growth and higher returns with sustained discipline on costs and risks,” he said.
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