We're not saying that Deutsche Bank is having a hard time lately, but it has watched it's stock price drop like a lead zeppelin over the past few years while paying billions in fines, alienating its rank and file by conducting massive layoffs and cancelling bonuses, and generally dealing with the nightmare of being a modern European bank.
But it's earnings season! And - as we always say - earnings season is a chance to cleanse yourself and move on in a ritual of hope and rebirth! Show us the shiny future, Deutsche Bank!...
Deutsche Bank shares dropped more than 3 percent on Thursday morning after reporting lower-than-expected revenue for its first quarter at a time when banking stocks have seen sharp gains after centrist Emmanuel Macron emerged as the winner in the first round of French presidential elections last week.
The bank's revenue stood at 7.3 billion euros, a 9 percent drop compared to this time last year. This missed Reuters estimate of 8.05 billion euros. The German lender said the first-quarter earnings were hit by a negative impact of credit spreads. It added however that without such impact, revenues would have been broadly flat on a yearly basis.
But surely analysts are rooting for the House of Cryan and saw the silver linings?
“We are rather disappointed,” Kian Abouhossein and Amit Ranjan, analysts at JPMorgan Chase & Co., wrote in a note. “This should normally be the best quarter in terms of revenue performance and market conditions were solid.”
Andrew Coombs, an analyst at Citi, said the numbers for Deutsche’s investment bank were “weak”.
You gotta spin this, Johnny C, you shiny-domed master of narrative you...
“Our first-quarter results were made weaker by Deutsche Bank getting stronger,” Cryan wrote. “Clients are returning following the turbulence late last year, and we see this in every business area.”
Attaboy! Get your troops in formation and bombard us with positivity!
“We’re definitely not yet firing on all cylinders,” [Deutsche Bank CFO Marcus] Schenck said in the interview with Bloomberg Television, adding it takes some time for prime brokerage balances to be rebuilt when clients return.