Deutsche Bank, Germany's largest bank, announced better-than-expected profits for the first quarter of 2023, but also flagged job cuts as it looks to further reduce costs. Net profit attributable to shareholders was €1.158 billion ($1.28 billion), a 9% rise from the previous year, and higher than analysts' expectations of €977 million. Despite the slump in investment banking revenue, income from higher interest rates boosted profits. This marks the 11th consecutive quarter of profit for Deutsche Bank. However, the bank is vulnerable to various economic and regulatory issues, and is planning unspecified job cuts in non-client facing staff to further reduce costs. Deutsche Bank had aimed to reduce dependence on its volatile investment bank, but revenue at the unit fell by 19% in Q1, below expectations of €2.8 billion.
Deutsche Bank's CEO Christian Sewing explained that the bank has worked hard to achieve stability, and will begin reducing senior non-client facing staff by 5% during the second quarter. This announcement comes alongside a major revamp of Deutsche Bank's management board that includes changes in overseeing its giant retail business and its U.S. operations. The aim of the reshuffle is "sustainable profitability." While Deutsche Bank is one of the world's most systematically important banks, analysts believe it remains vulnerable to a slowing economy, high inflation, war on the continent, and regulatory issues that have plagued the bank over the years.
