Jul 8, 2019 - Economy & Business

Behind Deutsche Bank's $8.3 billion revamp

Dion Rabouin, author of Markets
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Data: Investing.com; Chart: Axios Visuals

It was the long-expected end of an era for Deutsche Bank, as it announced Sunday it will pull out of its global equities sales and trading business, cut its dividend and slash risk-weighted assets by about 40% in some parts of the business, as part of a restructuring plan to save billions.

Our thought bubble as Axios' Felix Salmon points out: The "restructuring will cost 18,000 jobs and $8.3 billion, which is a lot of money for a bank valued at just $16.6 billion at close of trade on Friday."

  • The German bank also expects to report a net loss of $3.14 billion in the second quarter.
  • It will release its second quarter earnings on July 25.

What happened: Deutsche's struggles in equities and investment banking are not new. The company's stock tumbled during the financial crisis, after peaking at more than $145 a share in May 2007, and has never recovered.

  • The stock began mounting what looked like a rebound in July 2015, but in 2016 the company was hit with billions in fines from the U.S. Justice Department and lost all of that momentum. The stock closed at $8.03 Friday.

Go deeper: After Deutsche Bank cuts, where will the growth be?

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Why it matters: It's the lowest single-day positive rate since the start of the pandemic. It's another sign that the state that was once a global coronavirus epicenter is curbing the spread of the virus. "Our daily numbers remain low and steady, despite increasing infection rates across the country, and even in our region," Cuomo said in a statement. "But we must not become complacent: Everyone should continue to wear their masks and socially distance."

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