Deutsche Bank share price edges lower amid Commerzbank merger talks

The German lender saw its share price slide on Friday after announcing its full-year results, despite the bank expecting stronger revenues in 2019 and its CEO seeing a strong case for a merger with Commerzbank.

Deutsche Bank Source: Bloomberg

Deutsche Bank saw its share price edged lower on Friday morning after unveiling its full-year results, despite the German lender forecasting stronger revenues in 2019 and its CEO Christian Sewing warming to the idea of a merger with rival Commerzbank.

The bank’s management board opted to pay itself around €55.7 million in bonuses at the end of the 2018 fiscal year – their first in four years – with Sewing getting a pay-out of €7 billion, making him one of the best paid CEOs in European banking.

‘It adds to the negative overall picture of the bank, which is reeling from scandals and now apparently wants to plunge into a bad merger,’ Gerhard Schick, finance activist at Finanzwende and ex-member of the German parliament said, commenting on the bank’s bonuses.

‘We can look back on 2018 as a year that was anything but easy for Deutsche Bank,’ Deutsche Bank Chairman Paul Achleitner said. ‘Despite many challenges, we accomplished a great deal, made excellent progress in many areas and achieved our stated objectives.’

Deutsche Bank results: key figures

The German lender saw total net revenues fall to €25.3 billion in 2018, down from €26.4 billion in the previous year, while total noninterest expenses fell €24.7 billion in 2017 to €23.4 billion.

Meanwhile, basic earnings per share hit 0.01 cents a share in 2018, down from 0.53 cents in the previous year, with banks share price falling from €15.88 at the end of 2017 to €6.97 at the time of reporting its full-year results.

‘Deutsche Bank has built very solid foundations – this is the basis for controlled growth,’ Achleitner said. ‘The clearest sign of the turnaround is that for the first time since 2014 we reported a net profit, of 341 million euros. Year-on-year this is an improvement of more than 1 billion euros.’

‘We also managed to increase our pre-tax profit to 1.3 billion euros. Returning to profitability was a vital milestone for us,’ he added.

Merger with Commerzbank

Deutsche Bank’s lacklustre results and its controversial bonus pay-outs come as the lender starts to seriously contemplate a merger with rival Commerzbank, which if completed could see more than 30,000 slashed.

The merger is far from a done deal, however; asboth bank’s performance has been poor, with Deutsche Bank only managing 0.4% return on equity last year, while its rival managed just 3%.

The merger has also come under heavy criticism, despite a deal between the two lenders capable of creating Europe’s third-largest bank in terms of assets, with many commentators noting that combining two bad banks doesn’t create a better one.


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

See an opportunity to trade?

Go long or short on more than 16,000 markets with IG.

Spread bet and trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Bid
Offer
-
-
-
-
-
-
-
-
-
-
Bid
Offer
Bid
Offer
-
-
China 300
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Sunday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.


For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.