Deutsche Bank Stock: Shares Tumble on Q4 Profit Decline

Deutsche Bank experienced a significant market setback as its shares dropped nearly 4% to €18.76 on Thursday following the release of its latest quarterly results. The financial institution reported a substantial 36% decline in net profit attributable to shareholders, falling to €2.7 billion for the year 2024. The decline was primarily driven by elevated non-operational costs, particularly €1.7 billion in legal expenses, with €900 million allocated to compensate former Postbank shareholders. The sharp profit decrease and higher-than-expected costs caught both analysts and the broader market off guard, making Deutsche Bank the weakest performer in the DAX index.

Future Outlook Remains Promising

Despite current challenges, the bank maintains an optimistic stance for its future performance. Management has outlined ambitious targets for 2025, projecting revenue growth to €32 billion, building on 2024's increase to €30.1 billion. Shareholders are set to benefit from enhanced returns, with dividends rising from 45 to 68 cents per share, complemented by a planned €750 million share buyback program. The bank also aims to improve operational efficiency, though it has adjusted its cost-to-income ratio target to below 65% from the previous 62.5% threshold.