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Europe's Largest Bank Just Scrapped Its Dividend
Make no mistake, the writing has been on the wall for months.
Deutsche Bank is going through a painful restructuring that began with the ouster of co-CEOs Anshu Jain and Jürgen Fitschen and culminated in new CEO John Cryan’s move to eliminate a quarter of the workforce, or some 23,000 people.
The bank then proceeded to announce a shakeup in the corporate structure before moving to cut the I-bank bonus pool by some $566 million.
Well don’t look now, but just moments ago, Europe’s biggest bank eliminated the dividend.
- DEUTSCHE BANK TO ELIMINATE 2015, 2016 DIVIDENDS TO MEET TARGETS
Here's the press release:
From DB
The Management Board of Deutsche Bank today approved the implementation of the Bank's strategic plan, known as “Strategy 2020”. The plan includes the following financial targets:
- CET 1 ratio: at least 12.5% from the end of 2018
- Leverage ratio: at least 4.5% at the end of 2018 and at least 5.0% at the end of 2020
- Return on Tangible Equity (RoTE): greater than 10% by 2018
- Adjusted Costs (total noninterest expenses excluding restructuring and severance, litigation, impairment of goodwill and intangibles and policyholder benefits and claims) of less than EUR 22.0 billion by 2018
- Cost/income ratio (CIR) of approximately 70% in 2018 and of approximately 65% in 2020
- Risk Weighted Assets (RWA) (excluding regulatory inflation following regulatory changes expected to be at least EUR 100 billion by 2019/2020) of approximately EUR 320 billion at the end of 2018 and of approximately EUR 310 billion at the end of 2020.
Furthermore, the plan is based on the elimination of the Deutsche Bank common share dividend for the fiscal years 2015 and 2016. The Management Board expects to recommend the payment of common share dividends commencing from fiscal year 2017 at a competitive payout ratio.
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Maybe they need a few spies inside the Fed like Goldman.
Infinite NSA spying on European companies does not help either
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More fines coming for DB:
DOJ Launches Criminal Investigation Into Deutsche Bank Russian Tradeshttp://www.zerohedge.com/news/2015-08-04/doj-launches-criminal-investiga...
...right after the ECB raises the Reserve Ratio back somewhere above 1%, estimated to occur right about the time Hell freezes over.
no dividend? How mi gunna pay me margin calls on me 400x levered DB pozishunz waaaah!
yikes ... DB has been my choice for first domino to fall for years.... need to sign up with Draft Kings.
What a farce: Reduction of Costs, adjusted for (excluding) litigation, fines, goodwill impairments (i.e. investment losses) etc etc. The stupid tw*ts don't get it - if they didn't have unending fines for incompetence and criminality, continual write downs because of bad investment decisions, endless litigation costs due to incompetent management, if they didn't have all these costs they would have to cut their core costs and the RWAs and CET1 etc etc would all be okay. The Cryan 'improvements' are stripping out the real business costs so the bank can afford its incompetence bill. Hilarious and bye bye DB.
Like cutting dividends will save DB. I am curious who still keeps their assets at this bank given the negative publicity of the past few months.
....."a quarter of the workforce, or some 23,000 people. "
What did they produce?
Ahhhh, leachfucks, warts on the PONZI systems ass.
Bankers and their minions: The true "takers".
The 1%: The true Free Shit Army.
They had to click the like buttons on the boss his facebook page so he could say to the other EM PLOY EEEESSs that he's popular.
What I don't understand is why besides some webdesigners, a few programmers and the janitor that they need all that staff anymore.
Almost everybody does his banking on the internet. So why do they even need all those buildings?
You should see their headquarters!!
I recently drove by one of the most broke banks in Belgium, THEIR BUILING LOOKS LIKE THE PARTHENON TIMES 100 IN SHINY MARLE! IT'S ACTUALLY BUILD ON A ARTIFICIAL HILL!!
Not surprised.
I mean, look at GM's headquarters in Detroit. Does that look like a defunct car company saved by the US taxpayer? For fucks sake it looks better than Ford's HQ. And its also way nicer inside.
Fuck ALL these megacorps. They are a literal stain on this planet.
Obviously Taking the dividend money to buy SPY for the massive yearend rally the fed just guaranteed.
It will bite them in the ass.
Can anyone say "investor flight"?
Let me know when the privately owned fed suspends its dividend and we'll know it's game on.
They're a momo stock. No dividend. Just "growth".
The fed suspends its dividend? Not likely.
The more I look at the FED and the primary dealer system in NYC, the more I admire the fucking zheds (slavic for jew).
It took them 100 years but they're reached nervana....
18.5T in debt on its way to 20. Average roll over is 4 years so each year they have to roll 4-5T in bonds.
The primary dealers get 1-3%, lets call it 1.5%. 1.5% of 4T is 60 billion....now of course, this 60B has to be reinvested in:
The council on forgien relations, the new american century. etc.....
You need to keep these wars going, not too big mind you, but keep them going and NEVER win.
Daddy Bush fucked up in Gulf War 1 by winning in 5 days.....no-no-no-no, he always was a bit thick. That's not the program, that's why he lost in 92. The program is to NOT win over 10 years....keep the money bleed going, keep the expenditures to Lockheed, Boeing, Rockwell etc...and keep those bonds getting rolled. vietnam was PERFECT! Afganistan is a war dreams are made of....from the zhed perspective. Massive cash flow for decades, money, money, money.
This is all fucking genius....purely evil mind you but fucking genius.
Just what you'd expect from the zhed.
Squid
That VIX really got pounded today
On a day that stocks +/- was 2.5%. No volatility there! But of course nothing matters when the day finishes green.
why does this all sound greek to me?
throw in a little Vee Dub as well?
Ooops...
"Who left the light on?"
"No more steak, caviar and champagne, it's peas and beans for the trading desk until further notice..."
"...But, but, the hookers and blow were fringe benefits..."
Aren't banks barbarous relics anyway?
or is that biotechs?
This is a warning to everyone. Cutting the dividend is often financial speak for "We're fucking bankrupt!" I will be shocked if they don't default before 2017 when they pretend they will begin paying out again.
The Derivatives on the books, i will bet, are the core of the coming problem - the rest has been identified - they may bring the system down - which is all good
The loss they just declared is about twice that which took Lehman Bros. down. Not sure how deep the derivative hole goes however.
Where's Draghi?
The German taxpayers just got shafted for Deutsche Bank's trillions and trillions in derivatives losses.
Headline: " DB'S DERIVATIVES BANKRUPT GERMAN TAXPAYERS !"
I would expect arise in the preferred (DKT) if they want a dividend.
There's just not enough sheep left to shear, so DB has to let go of some of its shearers. And by cutting dividends, they ain't sharin' results of previous shearings either. This is called defaulting on your previous promises.
70 trillion in derivatives is the problem here.
Silly bank...why didn't they just fire enough employees to fund the dividend. Dividend is safe..stock goes up..stockholders happy...life is good!
No mention of this at Marketwatch, WSJ, NY Times and you only find the story at CNBC if do a search on Deutsche Bank itself. Once again the lame stream media chooses to take a pass on the most important news of the day.