Deutsche Bank, Germany's largest bank, said today it would miss its profit target for the current year in face of the financial market turbulence.
In face of "ongoing market turbulence, our planned pre-tax target of €10 billion from our core businesses is no longer achievable for 2011," Deutsche Bank said in a statement.
The "intensifying European sovereign debt crisis led to sustained uncertainties among market participants in the third quarter and thus to significantly reduced volumes and revenues," in particular for Deutsche Bank's corporate banking and securities business, chief executive Josef Ackermann told an investors' conference.
"In response to the significant and unabated slowdown in client activity, Deutsche Bank will consider additional cost controls beyond those already implemented" at its corporate and investment banking division.
"This will lead to a reduction in headcount by around 500 positions" in the division in the fourth quarter of this year and the first quarter of next year, the bank said. The job cuts would be implemented "primarily outside Germany."
Deutsche Bank said it would write off around €250m on Greek sovereign debt in the third quarter.
"Nevertheless, we will be profitable in the third quarter and expect a robust earnings level for the full year 2011," Ackermann said. "We are confident that the classic banking businesses - private clients, asset management and global transaction banking - as a whole will deliver their best pre-tax profit ever."
