Deutsche Bank shareholders can expect a dividend in 2022 – the bank’s chief executive confirmed to CNBC Tuesday.
Christian Sewing, who has been leading Deutsche Bank since April, said the lender has come a long way over the last months and remained committed to achieve its targets. Sewing had announced a massive overhaul plan in July under which the bank would be returning 5 billion euros ($5.5 billion) of capital to shareholders starting in 2022; would be maintaining a capital ratio of 12.5%; and would also reduce costs by about 6 billion euros ($ 6.65 billion).
“Our capital ratio at the end of the third quarter was stronger than our internal plan and I think it was also a surprise to the market and all I can see for the fourth quarter is that we will be again above 13%, which gives us a good buffer for 2020,” Christian Sewing, CEO of Deutsche Bank told CNBC’s Annette Weisbach Tuesday.
“We also want to return capital to the shareholders from the year 2022 on. That is important for us,” Sewing added.
Germany’s largest lender has struggled since the wake of the global financial crisis. The bank has been hit by higher competition, lower market share in investment and commercial banking; different litigation charges and various management reshuffles. Its share price has dropped about 82% from 10 years ago.
Shares of Deutsche Bank rose shortly after European bourses opened on Tuesday.
“Over the last five months, we have achieved all goals, some of them even overachieved. The bank has shown the plan which we put forward in July is working. We are confident to achieve our key targets be it on the capital side, on the cost side, on the revenue side, we see momentum. Of course, there are challenges like the interest rate environment, but we acted swiftly, decisively and hence we are positive,” Sewing said.
Deutsche Bank reported a net loss of 832 million euros ($921 million) in the third quarter of 2019. Sewing told CNBC that “it is no surprise the full year (of) 2019 and also the fourth quarter from a reported point of view is loss-making” due to the ongoing restructuring plan. Analysts are currently forecasting a net loss of 1.2 billion euros for the fourth quarter of 2019, according to data from Refinitiv.
The German bank is reportedly looking to cut about 100 million euros ($110 million) in annual costs by combining its domestic retail banking operation within the group’s structure, the Financial Times reported Monday.
Speaking to CNBC, Sewing said the restructuring plans are going well. The bank had said that there would be a workforce reduction of about 18,000 full-time jobs by 2022.