Deutsche Bank will report a record pre-tax loss of 6 billion euros ($6.7 billion) in the third quarter. As David Pollard reports it will also cut or skip dividend payments for 2015.
A possible dividend cut's usually disastrous news for a corporation to announce. For Deutsche Bank, it's ended by driving shares up. Mostly on a feeling that the cut itself means Deutsche may not need to raise capital to pay for its other headline announcement. A third-quarter pre-tax loss of six billion euros. IG's Alastair McCaig. (SOUNDBITE) (English) ALASTAIR MCCAIG, MARKET ANALYST, IG, SAYING: "When you consider that Deutsche Bank felt enabled to carry on paying their dividend throughout the financial crisis ... it does highlight just how much of a change in mentality and shift in policy is going on there." That policy is to shrink the bank, shed assets and exit certain markets. With this time, writedowns of well over 6 billion euros on its Postbank, investment bank and Chinese assets. And after a 2.5 billion dollar fine in April for Libor rigging, DB's adding another 1.2 billion euros chunk to its litigation war chest. CEO John Cryan, who took control in July, described the news as ''not good''. (SOUNDBITE) (English) ALASTAIR MCCAIG, MARKET ANALYST, IG, SAYING: "He's been brought in very much as the sharp scythe to cut a lot of the excess fat that Deutsche Bank undoubtedly has. There's already been a number of market expectations as far as job cuts are concerned, and there's going to no doubt be large changes." Full details of the results will be announced at the end of the month. Along with more insight into Deutsche's future strategy. Amid speculation 23,000 jobs could be on the line, staff may well brace for less good news to come.