Greenberg AZA Alliance - Deutsche Bank Profits Miss By A Mile.
Greenberg AZA Alliance: Deutsche Bank, Germany's largest by assets, has posted second quarter results that have missed analysts' forecasts by a considerable margin.
The flagship lender's quarterly earnings stands in sharp contrast to peers. So far this reporting season, investment banking rivals like Morgan Stanley, Goldman Sachs, JPMorgan Chase & Co, and Bank of America Corp have beat analysts' profit expectations, thanks largely to strength in trading and underwriting.
Deutsche Bank cut its net sovereign risks related to Greece, Italy, Ireland, Portugal and Spain to 3.91 billion euros at the end of March from 3.94 billion euros three months earlier, according to a presentation published on the company's website. Risks related to Spain fell to 873 million euros from 1.36 billion euros while those related to Italy rose to 2.52 billion euros from 1.95 billion euros, the slides show.
Pre-tax profits came in at ‚¬792m against expectations of ‚¬1.3bn after the bank was hit by a ‚¬630m increase in litigation reserves.
€The bank has promised to cut risky balance sheet assets in response to mounting regulatory concerns but the Libor rate-fixing scandal in which it found itself embroiled will prove costly,€ said an €Greenberg AZA Alliance€ European credit analyst.
The bank identified 250 billion euros worth of assets to cut in an effort to meet new bank safety rules. "We are committed to further reducing balance sheet in a manner that enables us to meet requirements on leverage ratio," Co-chief executive Juergen Fitschen said in a statement.
Deutsche said it will seek to achieve a leverage ratio of 3 percent under more stringent bank safety rules after regulators questioned the bank's ability to absorb financial shocks in a crisis.
The bank's results are in stark contrast to those of its peers in the US including JP Morgan Chase, Morgan Stanley and others who posted healthy profit increases thanks to proprietary trading and underwriting.
Some commentators believe that Deutsche Bank should consider curbing its global ambitions given the growing opposition to the universal banking model that many blame in part for the taxpayer involvement in bailout the financial system in 2008.
Greenberg AZA Alliance says it believes there is significant upside potential for Deutsche Bank over the long-term and cite its position as Germany's number one lender as a key strength as the world's fourth largest economy continues to defy broader European economic woes.
Visit Greenberg AZA Alliance: http://www.greenberg-aza-alliance.com
The flagship lender's quarterly earnings stands in sharp contrast to peers. So far this reporting season, investment banking rivals like Morgan Stanley, Goldman Sachs, JPMorgan Chase & Co, and Bank of America Corp have beat analysts' profit expectations, thanks largely to strength in trading and underwriting.
Deutsche Bank cut its net sovereign risks related to Greece, Italy, Ireland, Portugal and Spain to 3.91 billion euros at the end of March from 3.94 billion euros three months earlier, according to a presentation published on the company's website. Risks related to Spain fell to 873 million euros from 1.36 billion euros while those related to Italy rose to 2.52 billion euros from 1.95 billion euros, the slides show.
Pre-tax profits came in at ‚¬792m against expectations of ‚¬1.3bn after the bank was hit by a ‚¬630m increase in litigation reserves.
€The bank has promised to cut risky balance sheet assets in response to mounting regulatory concerns but the Libor rate-fixing scandal in which it found itself embroiled will prove costly,€ said an €Greenberg AZA Alliance€ European credit analyst.
The bank identified 250 billion euros worth of assets to cut in an effort to meet new bank safety rules. "We are committed to further reducing balance sheet in a manner that enables us to meet requirements on leverage ratio," Co-chief executive Juergen Fitschen said in a statement.
Deutsche said it will seek to achieve a leverage ratio of 3 percent under more stringent bank safety rules after regulators questioned the bank's ability to absorb financial shocks in a crisis.
The bank's results are in stark contrast to those of its peers in the US including JP Morgan Chase, Morgan Stanley and others who posted healthy profit increases thanks to proprietary trading and underwriting.
Some commentators believe that Deutsche Bank should consider curbing its global ambitions given the growing opposition to the universal banking model that many blame in part for the taxpayer involvement in bailout the financial system in 2008.
Greenberg AZA Alliance says it believes there is significant upside potential for Deutsche Bank over the long-term and cite its position as Germany's number one lender as a key strength as the world's fourth largest economy continues to defy broader European economic woes.
Visit Greenberg AZA Alliance: http://www.greenberg-aza-alliance.com
