Deutsche Bank on Thursday said it plans to slash 3,500 jobs after reporting a 30% drop in fourth-quarter profit that included heavy losses in its US real estate holdings.
The layoffs come after the German banking giant hired 300 front-office staffers in the three-month period ended Dec. 31, though the firm’s CEO Christian Sewing said the headcount reduction will primarily impact back-office roles, and are part of a larger turnaround effort, according to The Wall Street Journal.
Let me stress that cost discipline continues to be our top priority, Sewing told reporters, per The Journal, adding that the bank would take more cost-saving measures if need be.
The bank had already announced plans to cut jobs, but this was the first time it had put a number on the layoffs, equivalent to just under 4% of its global workforce of about 90,000. The jobs affected will be back office roles.
Sewing also announced a share buyback plan and to pay dividends will total $1.7 billion during the first half of the year.
Though its fourth-quarter net profits plunged 30% from the year-ago period, the $1.4 billion that was generated easily beat the $853.45 million analysts expected.
Deutsche said it took $133 million hit for its US-based portfolio, which includes its headquarters on Wall Street, as well as locations in California, Florida and Texas, according to a presentation to investors released alongside earnings obtained by Bloomberg,
The provisions mark a more than 350% increase from the roughly $28.2 million it allotted for losses regarding its portfolio in 2022’s fourth quarter, Bloomberg reported.
Deutsche’s US offices represent about 1.5% of its total lending book, according to the outlet.
The bank, based in Frankfurt, Germany, also said refinancing its real estate loans was the “main risk.”
There’s also the possibility that debts will come due on properties that have fallen in value, requiring borrowers to inject fresh equity to secure new loans, the bank said.
Representatives for Deutsche Bank did not immediately respond to The Post’s request for comment.
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Deutsche isn’t the only firm that faces debts on its real estate: Last month, Bloomberg revealed that asset manager Blackstone defaulted on its $308 million mortgage on a Manhattan office tower more than a year ago and the debt is now up for sale at a discount of more than 50%, citing people familiar with the matter.
Given the discounted loan, sources told the outlet that the building — located at 1740 Broadway — could be eligible for an office-to-residential conversion.
The skyscraper has been losing value since 2014, when the mortgage was originated and the 26-story Art Deco-style tower was appraised at $605 million, according to loan documents reviewed by Bloomberg.
The tower is just one of many empty office buildings scattered across New York City, which is in a so-called urban doom loop caused by an influx of working from home during the pandemic a trend that has stuck despite return-to-office mandates.
The doom loop concept is defined by empty office towers, which destroy quality of life and eventually drive residents out.
In the Big Apple, occupancy has only bounced back to 48.4% since the pandemic.
At the start of 2020, however, office occupancy was a strong 90% before it plummeted to 10% upon the outbreak of COVID-19.
Left-wing Labour MPs are split on whether they would welcome an Angela Rayner leadership bid, as speculation continues over whether Sir Keir Starmer can survive.
Senior MPs on the left have told Sky News that the former deputy prime minister “only needs to push the button” and she would have the support to take out her old boss.
But others said it “won’t wash with the public”, given it was only a few months ago that she resigned in scandal over her tax affairs. She has also been accused of not doing enough for the left while she was in government.
Sir Keir has insisted he would face down any threat to his leadership, while Ms Rayner’s allies say she has no plan to oust him.
But many MPs have said privately – if not publicly – that a challenge to his position appears increasingly inevitable given the state of the polls.
One MP in the socialist campaign group (SCG) said “all Angela needs to do is push the button” and MPs would get behind her – citing her popularity with the Labour membership.
Another MP said: “I think she would have a healthy number of people who would back her.”
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Ms Rayner, a former trade union rep, was elected by members to be deputy Labour leader in 2020. She was a longstanding member of Jeremy Corbyn’s shadow cabinet and is revered by many of her colleagueson the left for her rise from a working-class background to the top of British politics, having left school at 16, pregnant, and with no qualifications.
However one MP said while they personally “rate her a lot” she “could have done more” for the left while in government.
“Ange was the deputy leader for a long time. I have to say she went to ground for a long time and didn’t speak up. Whether she has the support of MPs or the country I don’t know.”
This view was echoed by another colleague, who said she is “complicit” in the government’s failures.
This MP, in a traditional red wall seat, said the “visceral dislike of Starmer is baked in” and they have never experienced anything like the anti-Labour sentiment they are hearing on the doorstep.
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1:46
Is Andy Burnham coming for Starmer?
They said any change of leader would have to be an outsider with a radical vision “like 1945”. “It would have to be Andy”, they said, referring to the Greater Manchester metro mayor Andy Burnham.
‘Burnham is a no-brainer’
Many MPs on both the left and the so-called “soft-left” told Sky News he would be their preferred candidate, given he is not associated with the current government, he has a different vision for the country and is popular with the public.
Mr Burnham is not currently an MP but he has not ruled out standing if a seat became available.
“In a hypothetical universe where all the barriers are overcome then Burnham is a no-brainer,” said one MP from the 2024 intake.
Another MP supportive of a Burnham takeover said a Rayner return “won’t wash with the public” given she had to resign from the second most senior position in government for underpaying stamp duty in September. They said it also wouldn’t be credible for her to “suddenly” start criticising the direction of the Starmer government given she was so closely tied to it.
As another MP put it: “I’d be backing a candidate from the left of the party. Angela Rayner is not from the left of the party.”
Other runners and riders
Any challenger would need the public backing of 80 colleagues to trigger a leadership contest. May is seen as crunch date if the local elections go as badly as predicted.
Image: Wes Streeting. Pic: PA
Other names that have come up include Health Secretary Wes Streeting and Home Secretary Shabana Mahmood. Mr Streeting is seen as a charismatic communicator who could take on Nigel Farage and Zack Polanski, while MPs within the “blue Labour” caucus are impressed with Ms Mahmood’s hard line on immigration.
But MPs on the left feel this would only offer a temporary boost in the polls as the pair are both seen as being on the centre-right, and a change of leader would be pointless without a change of direction.
Another name that has come up is the former Labour leader Ed Miliband, but while he is more to the left he has been rejected by the public once – having lost the 2015 election.
‘No active plot’
The MPs who spoke to Sky News stressed there was no active plot, but rather a general consensus that it is looking increasingly likely Sir Keir won’t be able to turn things around.
MPs who disagree with the prime minister’s politics said they are surprised at how personally disliked he is on the doorstep as he is ultimately a “nice man”.
They fear he has lost the trust of the public by saying one thing and doing another, with the winter fuel fiasco still coming up in areas where Reform UK is making gains.
As one MP put it: “We want him [Sir Keir] to do well and do better… but you can’t go on forever if things look terrible in the opinion polls.”
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MPs have recently revived the soft-left tribune group with the aim of influencing the government to take more of a progressive direction.
Ms Rayner addressed this group on Tuesday night, along with new deputy leader Lucy Powell and cabinet ministers Mr Miliband and Lisa Nandy.
One MP who spoke to Ms Rayner said she has “absolutely no plans” to launch a leadership bid “unless she is keeping it quiet”. They added that the subject of a leadership challenge didn’t come up in any of the speeches and there was an “upbeat atmosphere” following the lifting of the two-child benefit cap.
“The budget has landed well with the party,” they said. “[The meeting] felt like a sea change.”
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0:42
Streeting: ‘We need Rayner back’
As deputy prime minister and housing secretary, Ms Rayner introduced the Employment Rights Bill within 100 days and pushed through reforms to renters rights, the leasehold system and further devolution. She is also said to have played a crucial role in persuading Sir Keir to water down welfare cuts in the face of a major backbench rebellion.
A source close to her defended her record, saying she is “not interested in pacts and plots” and wants the government to succeed. They said she is not finished in politics but “she’s no one’s pawn, she’s her own person”.
Ms Rayner resigned after an ethics investigation found she acted in good faith, but broke the ministerial code by failing to get the correct tax advice after purchasing a flat in Brighton. She referred herself to HMRC and an investigation is ongoing.
Dulwich College has said allegations that Nigel Farage made racist and antisemitic comments to fellow pupils at the school are “profoundly distressing” and “entirely at odds with the Dulwich College of today”.
In the first reported statement from the school about the accusations – which date from 1970s – current master Robert Milne wrote “such behaviour is wholly incompatible with the values the College holds”.
“What we can unequivocally state is that the behaviours described are entirely at odds with the Dulwich College of today,” he continued
The comments come in a letter to former Dulwich pupil Jean-Pierre Lihou.
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3:22
Nigel Farage has previously said he “never directly racially abused anybody”.
Mr Farage has said he “never directly racially abused anybody” at Dulwich and said there is a “strong political element” to the allegations coming out 49 years later.
Reform’s deputy leader Richard Tice has called the ex-classmates “liars”.
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Nigel Farage said: “I have not met or spoken to this master. So I am surprised by his uninformed comments in response to claims from nearly 50 years ago from politically motivated actors.
“If he is interested, I can show him the many messages that I have received from fellow pupils, including Jewish ones, that entirely contradict these allegations.”
A spokesperson for Reform UK said: “This witch hunt is merely an attempt to discredit Reform and Nigel Farage.
“Instead of debating Reform on the substance of our ideas and policies, the left-wing media and deeply unpopular Labour Party are now using 50-year-old smears in a last act of desperation.
“The British public see right through it.”
Image: Dulwich College, pictured in 2022, has responded for the first time to claims Nigel Farage made racist comments as a student. Pic: PA
The letter also says the college has avoided making any public statements “to protect the college’s reputation in the long term”.
“This should not be interpreted as indifference: safeguarding the college’s good name and upholding its values are of paramount importance to us,” it continues.
Mr Lihou told Sky News he cautiously welcomed the letter written to him from the master and said he understands why the college wasn’t willing to unequivocally condemn the allegations against the Reform leader directly.
“Dulwich College has been clear that such accusations are very much at odds with the values of the school,” he said.
He added: “Why can Mr Farage not accept that approaching 30 people [who] have lasting memories from him as a 13-year-old to an adult that he should unreservedly apologise for?”
Sky News has contacted Dulwich College for a comment.
Volodymyr Zelenskyy says the US has offered to create a “free economic zone” in the contested Donbas region of eastern Ukraine in a bid to push a peace deal over the line.
The Donbas – an industrial and coal-mining area primarily made up of the Donetsk and Luhansk regions – has become one of the key sticking points in the US-proposed peace plan.
The first draft of the plan, widely leaked last month, stipulated that Ukraine must withdraw from areas of the Donbas it currently controls, thought to be a minority portion, as a condition for peace.
Image: Donald Trump meeting with Ukrainian President Volodymyr Zelenskyy at the White House in February. Pic: Reuters
Ukraine considered that point “unacceptable”, and Mr Zelenskyy has spent the last few weeks drafting a response to the plan that removed “obvious anti-Ukraine points”.
After a series of meetings with Ukraine’s European allies, including a trip to London to meet Sir Keir Starmer on Monday, Zelenskyy said on Thursday that he’d sent Washington a revised peace plan, whittled down to just 20 points.
The new US proposal envisions Ukraine withdrawing from its territory in the Donbas without the Russians advancing, creating a neutral zone.
But Zelenskyy poured cold water on the plans as he briefed journalists in Kyiv.
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Image: Rescuers work after a Russian air strike in Sumy region, Ukraine. Pic: Reuters
“Who will govern this territory, which they are calling a ‘free economic zone’ or a ‘demilitarised zone’ – they don’t know,” he said.
“If one side’s troops have to retreat and the other side stays where they are, then what will hold back these other troops, the Russians? Or what will stop them disguising themselves as civilians and taking over this free economic zone? This is all very serious.
“It’s not a fact that Ukraine would agree to it, but if you are talking about a compromise then it has to be a fair compromise.”
Sky News military analyst Michael Clarke gave an ominous assessment of the proposal, saying it left “no physical solution” to resolve the problem of future attacks.
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49:17
Michael Clarke assesses the state of the war in Ukraine
He said: “If Ukraine gives up the fortress cities in the Donbas, the only security they can have is by being heavily armed and being backed by their allies in some way.”
“The only thing that would stop Russia is deterrence: the knowledge that either the European forces were sitting in Ukraine ready to fight for them, which is hard to imagine at the moment, and even harder to imagine that they are backed up by American forces.”
Matthew Savill, director of military sciences at the Royal United Service Institute, was similarly sceptical.
“The general view is that the Russians will be too tempted to… try and come back for more,” he told Sky News.
He added that “some kind of temporary ceasefire” might work, but it would require “the Europeans to demonstrate they can put their forces where their mouth is in terms of a reassurance force”.
Amid this backdrop there was a meeting today of the coalition of the willing – the 34-strong bloc of nations pledged to support Ukraine against Russian aggression, of which Britain is a part.
There was agreement to continue to fund military support, “progress on mobilising frozen Russian sovereign assets”, and an update from Zelenskyy on Russia’s continued bombardment of his country, according to Downing Street.
Afterwards, Zelenskyy said the bloc was working to ensure any peace deal contains “serious components of European deterrence”.
Image: A Ukrainian serviceman in combat practice in Kharkiv region, Ukraine. Pic: Reuters
He added: “It is important that the United States is with us and supports these efforts. No one is interested in a third Russian invasion.”
He also addressed growing pressure from the US for an election in Ukraine, saying “there must be a ceasefire” before the country can go to the polls.
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Zelenskyy’s term expired last year, but wartime elections are forbidden by law in Ukraine.
Meanwhile, the tone tonight from the White House was one of impatience, with Trump’s team saying he wouldn’t attend further meetings until there’s a real chance of signing a peace deal.
“The president is extremely frustrated with both sides of this war, and he is sick of meetings just for the sake of meeting,” said White House spokeswoman Karoline Leavitt.