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Deutsche Bank's horrible results have sent shares crashing

Jan 21, 2016, 14:40 IST

Workers sweep leaves outside Deutsche Bank offices in London December 5, 2013. REUTERS/Luke MacGregor

Shares in German giant Deutsche Bank are crashing on Thursday morning as European investors get their first chance to react to the company's horrible preliminary earnings, released on Wednesday.

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In the first hour of trading in Germany, Deutsche's shares have tanked, and at 9:00 a.m. GMT (4:00 a.m ET), shares are off 6.7%, down €1.22 (£0.94; $1.33) to €16.49 (£12.67; $17.95).

That continues a slump that's lasted for all of 2016 so far. This week losses have topped 12%, and the company's market cap has dropped by 25% since trading began on January 4.

Here's the chart:

Investing.com

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Along with market uncertainty across the globe, Deutsche's share drop this morning is down to the bank's continuing struggles, which are reflected in their preliminary results.

When results dropped yesterday, the big number was this: Deutsche expects to make a net loss of €6.7 billion (£5.15 billion; $7.3 billion) for the full year.

The bank also said that it is facing upwards of €1.2 billion in legal charges, and "restructuring and severance charges" of another €0.8 billion in its Private & Business Clients unit.

Deutsche's slump on Thursday comes against a background of a broader recovery in Europe's markets this morning, following yesterday's worldwide rout. Europe's major indices are broadly on the right side of the line, although they're generally only up around 0.5%. The DAX 30, Germany's benchmark share index is one of the few in the red, down 0.2%.

Deutsche Bank's struggles in the past year or so are well documented, and new CEO John Cryan, is trying to completely turn the bank on its head in the pursuit of new success. Since taking the reins last year, Cryan has criticised banking's bonus culture, shaken-up the bank's board, and is reportedly working 15 hours days to turn Deutsche around.

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