Deutsche Bank Reports Big Loss as Overhaul Costs Bite

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Now we've been hearing about don't your bank's earnings this morning Germany's biggest lender lost three point two billion euros in the second quarter a big in that loss than previously indicated trading revenue until it should drop twelve percent in the second quarter as it again under performed its biggest US rifles well the company's CFO James von Moltke spoke to Bloomberg's Matt Miller we're working together to execute on the restructuring just as quickly as we can and with that execution comes the accounting recognition of the steps we've taken this quarter we're recognizing about three point four billion of costs associated with the transformation those are blowhard by and large non cash charges DTA impairments goodwill impairments and software intangibles that we're also in parents so we get a good portion of of the of the accounting impact already behind us in the second quarter in the balance of the year we're working now to take severance and restructuring charges in the second half as we execute on the restructuring they'll be some real estate charges and some incremental DTH charges in the year so we're expecting probably another two billion of of of these related charges over the coming several quarters of two quarters in particular what percentage of the job cuts teasing you can get done in this year I mean clearly that's a big portion of the cost so how many can you get out of the work it's a steady gradual process and and it's affecting pretty much all areas of the firm and all geographies we're working as quickly as possible but also trying to execute on this is sensitively as possible given it's affecting the lives of our colleagues and and and friends but we're actually just as quickly as we can we've notified about nine hundred staff already associated principally with the with the equity sales and trading business there either leaving or have left or leaving here in near term the platform the capitol release unit is well under way in terms of execution on the de leveraging staffs organizing itself under new management team and also moving to again reduce that the head count associated with the businesses that were either exiting or significantly reducing so we're we're well advance frankly for for two and a half weeks and but it's a process that we now need to to focus on and continue steadily for the next several quarters and frankly years but you have a head count idea what costs are you any if we constantly nineteen we have some internal targets absolutely I'm what we said externally was was that continue to be below ninety thousand that's something we intend to to achieve and hopefully go as deep into the to the high eighties as possible what we don't want to give a specific targeted at this stage for a for a number of reasons one thing that as you you may see going on and we've talked about overtime was internalization so we are continuing to internalize prickly technology jobs I'm in the ongoing businesses that type of activity will continue so it's a bit of an admin flow hence the you know the the reluctance to be pinned down on a very specific target number for for the next couple you mention the equity sales and trading business that was down thirty two percent the fixed income business was down only four percent and those numbers as big as they are compare not so unfavorably to your peers on the street why did you do better than expected I agree so so our fix franchise actually performed quite well I think in the environment and and relative to peers that four percent is reported it's about down eleven percent if you exclude the trade web game which also a number of our our peers had and within that frankly rates performed reasonably this is a no solidly our credit franchise was was up year on year and and so we were quite encourage frankly with the performance in in many of our of our rates businesses Hey armor fanfic fixed income and currencies businesses I will say obviously equities is down significantly that reflects both the restructuring that we we executed last year and also as you'd expect some of the uncertainty that played out during the quarter as the market and frankly clients and employees were anticipating some element of of restructuring to come and that was the Deutsche Bank CFO James when mocha speaking to Bloomberg's Max Miller in

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