Deutsche Bank AG (DB) shares were the biggest decliner in Germany Thursday after the bank posted a bigger-than-expected fourth quarter loss and lifted its litigation reserves to more than €7 billion after fines linked to U.S. mortgage bonds and Russian money laundering hammered its bottom line.
Deutsche Bank said its net loss for the three months ending in December was marked at €1.9 billion ($2.05 billion), higher than €1.2 billion billion figure anticipated by analysts. Revenues for the three months ending in December were marked at €7.1 billion, the bank said, a 6% increase over the same period last year. The bank added €2.6 billion to its litigation reserves in the quarter, it said, with the total now at €7.6 billion.
Full year revenues were marked at €30 billion, Deutsche Bank said, down 10% from 2015, a decline which it said reflected "a challenging market environment, persistent low interest rates, Deutsche Bank-specific pressures and strategy execution."
Deutsche Bank shares fell more than 6% in early Frankfurt trading to change hands at €17.93, the biggest decline on the DAX performance index, but are still more than 47% higher over the past three months.
"Our results for the year 2016 were heavily impacted by decisive management action taken to improve and modernise the bank, as well as by market turbulence for Deutsche Bank," said CEO John Cryan. "We proved our resilience in a particularly tough year. We finished 2016 with pleasingly strong capital and liquidity ratios and we are optimistic after a promising start to this year."
