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Deutsche Bank warned investors that costs in 2025 would be higher than expected after fourth-quarter profits plunged and the bank missed its 2024 cost target and analyst expectations as it was hit by litigation charges and higher-than-expected loan losses.
Germany’s largest lender said on Thursday that it was now targeting a cost-income-ratio — a key efficiency benchmark — of less than 65 per cent this year.
The new target is higher than the bank’s previous aim of keeping costs below 62.5 per cent of income but would still represent a far better performance than the 76 per cent ratio it achieved 2024.
Deutsche narrowly missed its target of keeping costs — excluding litigation charges and restructuring expenses — below €20bn in 2024.
In the fourth quarter, net profit attributable to shareholders fell to €106mn, a 92 per cent decrease on the same period a year earlier and well below the €380mn figure expected by analysts.
Deutsche Bank chief executive Christian Sewing said he still had “firm confidence” the lender would meet its target of lifting returns on tangible equity to more than 10 per cent in 2025, after they fell to 4.7 per cent last year.
He said the bank was still aiming to generate revenues of more than €32bn in 2025 and added that the lender had made a “strong start . . . this year”.
