Deutsche Bank Swings to $6.2 Billion Loss

Germany's biggest bank reported a record fourth-quarter loss as sales and trading revenue slumped.
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Updated from 2:14 a.m. EST

Deutsche Bank

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swung to a record loss in the fourth quarter of 4.8 billion euros ($6.17 billion) from net income a year earlier of 969 million euros.

For 2008, Germany's biggest bank bank reported a net loss of 3.9 billion euros.

Net revenue in the quarter was a negative 885 million euros, compared with revenue of 7.3 billion euros in the same period a year earlier. At Deutsche Bank's corporate and investment bank net revenue was a negative 3 billion euros, compared with 4.5 billion euros.

"Operating conditions in the quarter were completely unprecedented, and exposed some weaknesses in our business model," said Chairman Josef Ackermann on Thursday. "We therefore are repositioning our platform in some core businesses."

In corporate banking and securities, net revenue was a negative 3.8 billion euros, reflecting declines in sales and trading revenue.

Ackermann said Deutsche Bank continues to see "very difficult conditions for the global economy, posing significant challenges for our clients and for our industry."

The net loss figures reported Thursday were in line with a preliminary estimate issued by the bank in mid-January.

The bank reported a fourth-quarter pretax loss of 6.2 billion euros, compared with a profit of 1.4 billion euros a year earlier. For the full year, the bank booked a pretax loss of 5.7 billion euros.

Deutsche Bank said its boards would recommend a dividend of 0.50 euros a share, down from 4.50 euros a share a year earlier.

Deutsche Bank's private clients and asset management division saw fourth-quarter revenue fall 22% to 2 billion euros, while at the asset and wealth management division revenue declined 47%.The bank's Tier I capital ratio, a measure of liquidity, was 10.1% at the end of the fourth quarter, down from 10.3% at the end of the previous quarter.

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