Saturday 16 May 2015

DB report Q1 2015

DB, Q1, 2015, report, front page

The other day I listened to an interview with the previous Swedish minister of finance. He then mentioned that the Swedish, Irish and British banks all got slapped by their governments with new regulations to make them clean their acts back in 2009/10 while the German banks were handled with silk gloves by the German government. Most of the British, Irish and Swedish banks are today doing very well while the German banks are still rolling around in the dirt. The fantasy that that financial institutes should not be regulated and handled with care is simply bunk. What was then this time in the DB report?

The report in full you can find here and for my previous summary of the DB annual report 2014 then please click on that link and to find out more about DB then visit DB analysis 2015.

One thing that I directly look at was of course the value used for banks to indicate if they are successful or not... the cost to income ratio. A successful bank is around 50% so where do we then find DB? Surprise, surprise they managed to do even worse than in Q1 2014 and have gone from a C/I ratio of 77.0% to 83.6% well done!

What else of interest could then be found? Well... they did indeed manage to increase their revenue a little but then on the other hand their costs also increased so for us, the owners of DB, the crumples left were only 544 million € compared to 1,083 million € last Q1. Oh, and we shall also never forget how banks love to show three nice quarters to then in the final one amazingly "discover" that there was a need for some write downs in the size of a couple of billions. If they push the sales of the Postbank then there will most likely be a couple of billion € in write-downs appearing.

DB, Q1, 2015, income statement

Conclusion: Deutsche bank continue to perform poorly and they are still sitting with 100k employees which I still wonder why and for what reason. The litigations are still not finished so more will arrive also there and of course those 100k employees have probably done some new things to earn their bonuses! I will remain a grumpy shareholder in Deutsche Bank.

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