FRANKFURT, Germany (AP) — Deutsche Bank said Tuesday it plans to cut about 1,900 jobs, most of them outside Germany, as Europe's debt crisis hurt profits at its investment banking business.
Germany's largest bank, which employs nearly 101,000 people, said second quarter earnings slid 46 percent to €661 million from €1.233 billion in the same three months a year ago.
Market turbulence and subdued client activity due to Europe's problems with too much government debt were behind the decline, with revenues down 6 percent to €8.0 billion.
At its investment banking division, for example, income fell as fewer companies came to the bank requesting its services to issue shares, or for advice on buying or merging with other companies. Those activities can earn lucrative fees for banks.
Revenue from trading debt securities — one of the investment categories most affected by the crisis — was also down. The company said that was partly due to the company taking "deliberately lower levels of risk" due to subdued trading volumes. It said it would continue shedding risky assets in the months ahead.
Overall, Deutsche Bank's corporate banking and securities division, where share underwriting and debt trading are located, saw revenues fall by €451 million to €3.5 billion.
"The European sovereign debt crisis continues to weigh on investor confidence and client activity across the bank," the bank said.
European governments such as Spain and Italy are struggling with high levels of debt, and the prospect they might default or need bailouts has unnerved markets. The debt crisis has made companies and consumers reluctant to borrow, spend and invest.
The bank said about 1,500 of the job cuts will be in the investment banking business and in related infrastructure areas. The cutback will contribute some €350 million to an overall target of €3 billion ($3.8 billion) in savings.