Deutsche Bank’s share price took a further knocking today, as investor uncertainty over the firm’s drastic business overhaul showed no sign of easing.
Shares in the German lender tumbled a further 3.5 per cent to €6.57 this afternoon, adding to yesterday’s losses after the company unveiled cost-cutting plans to axe 18,000 jobs and shut its loss-making equities business.
The group’s stock value has fallen by its largest two-day decline in nearly three years, tumbling 10 per cent since the start of trading yesterday and falling to a two-week low earlier today before recovering slightly.
A sell-off in the company’s shares comes in the wake of layoffs across its global offices, from Hong Kong and Singapore to the US and Europe.
Chief executive Christian Sewing’s €7.4bn turnaround plan, which was revealed on Sunday night, has been met with a mixed response from analysts and investors, as doubts linger over whether the cuts and change in strategy can save the ailing firm.
Fitch Ratings said: “Cutting back volatile, capital-intensive and underperforming sales and trading activities, and further reducing the cost base should improve profitability and strengthen leverage, but execution risks are high. The outlook is ‘evolving’, indicating that the rating could move in either direction over a one-to-two-year horizon.”
Rising costs, falling revenue, botched merger plans and a series of high-profile scandals have blighted the firm in recent years, denting its decades-long ambition of becoming one of the world’s top investment banks.