Deutsche Bank stock soars 14% as investor takes stake

Business

FILE- In this May 24, 2018, file photo, CEO of Deutsche Bank Christian Sewing makes his way to the annual meeting of the bank in Frankfurt, Germany. Deutsche Bank’s battered stock soared 14.4 percent on Thursday, Feb. 6, 2020 after a new investor took a large stake – a move seen as a vote of confidence in the restructuring effort led by CEO Christian Sewing. Deutsche Bank disclosed that Los Angeles-based Capital Group Companies had taken a 3.1 percent stake. Shares rose to 9.41 euros, the highest since October 2018. (AP Photo/Michael Probst, File)

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FRANKFURT, Germany (AP) — Deutsche Bank’s battered stock soared 14.4% on Thursday after a new investor took a large stake — a move seen as a vote of confidence in the restructuring effort led by CEO Christian Sewing.

Deutsche Bank disclosed that Los Angeles-based Capital Group Companies had taken a 3.1% stake. The bank’s share price rose to 9.41 euros, its highest since October 2018.

Like other banks in Europe, Deutsche Bank earnings have been under pressure from low interest rates, which squeeze the profit margins banks can earn on lending. Beyond that the bank has struggled for years with high costs, questions about its business model, and fines and settlements with regulators for misconduct.

Sewing took over in 2018 with a mandate to accelerate a drawn-out restructuring, cut costs and improve returns to shareholders. In July, the bank announced plans to drop 18,000 jobs and downsize its risky and volatile investment banking division.

Germany’s biggest bank reported a net loss of 1.48 billion euros ($1.6 billion) for the October-December period, compared with 409 million euros a year earlier. For the full year, it lost 5.27 billion euros, compared with a profit of 341 million euros in 2018. The quarterly and full-year losses were largely driving by charges for restructuring.

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