Deutsche Bank ready for 'tough cuts' as share price sags

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CEO of Deutsche Bank Christian Sewing speaks during the annual shareholders meeting in Frankfurt, Germany, Thursday, May 23, 2019. (AP Photo/Michael Probst)

The CEO of Deutsche Bank says he is ready to make "tough cuts" to improve the struggling bank's profitability and raise a "disappointing" share price as negative headlines continue to plague Germany's biggest bank.

Christian Sewing made the remarks Thursday in front of restive shareholders at the bank's annual meeting in Frankfurt, Germany.

He touted the bank's full-year profit from 2018 — the first since 2014 — and achievement of its cost-cutting goals. The bank has cut staff to 91,700 employees, from 99,700 in 2016.

But the meeting takes place amid a heavy flow of bad news for the bank. Shares traded at record lows Thursday, U.S. congressional committees have subpoenaed the bank records of President Donald Trump, and on Wednesday the firm admitted it had used faulty software to screen customer transaction for money laundering.

The bank has struggled for years with high costs, low profitability and heavy fines and settlements for regulatory and legal breaches. Sewing took over as CEO last year with a mandate to accelerate change and put the bank's troubles behind it.

Past issues continue to bedevil the bank, however. The New York Times this week reported that bank employees recommended reporting transactions involving entities controlled by Trump and son-in-law Jared Kushner to federal financial watchdogs but that such reports were not filed. Deutsche Bank denied the report.

The bank rejected a potential merger with Commerzbank after talks, saying the combination would not make business sense. A number of analysts agreed a merger could be difficult. The lack of a deal, however, left unanswered what new strategy the bank could pursue to make its business more efficient and profitable.

Sewing said that the bank would press ahead with cost cuts. "We are going to accelerate the transformation," Sewing said, "by focusing the bank consistently on profitable and growing business areas that are especially important for our customers."