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Deutsche Bank has set out plans to triple its dividend, buy back more shares and cut jobs as Germany’s biggest bank tries to boost a share price that has languished over the past year.
The bank said on Thursday that it wanted to “accelerate” its payouts to shareholders and was on track to beat a target of returning €8bn by 2025.
The pledge came despite a 30 per cent drop in profits during the fourth quarter, when the bank was stung by a higher tax bill and a larger provision for loan losses as Germany’s economy slows.
Deutsche made €1.26bn in net income in the final quarter of the year, down from €1.8bn in the year earlier period. Revenues and costs both climbed 5 per cent in the period.
As the windfall from higher interest rates begins to recede, the bank has also said it will cut 3,500 jobs by 2025 after its staff numbers have risen by more than 5,000 in the past 12 months.
The increase took the bank’s workforce back above the 90,000 mark for the first time since chief executive Christian Sewing embarked on a large restructuring in 2019. Most of the positions to be eliminated would be non-client facing ones, Deutsche added.
Shares in Deutsche have slipped 2 per cent over the past 12 months.
As part of its plan to boost shareholder returns, Deutsche said it would lift its dividend by 50 per cent to €0.45 a share this year and vowed to push the payout to €1 a share by 2025.
The bank also promised to buy back another €675mn of shares over the next five months after receiving regulatory approval, following a €450mn share buyback in 2023.