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.
An Israeli delegation is heading to Qatar for indirect talks with Hamas on a possible hostage and ceasefire deal in Gaza.
The development comes ahead of a meeting between Israeli Prime Minister Benjamin Netanyahu and US President Donald Trump in Washington DC on Monday aimed at pushing forward peace efforts.
The US leader has been increasing pressure on the Israeli government and Hamas to secure a permanent ceasefire and an end to the 21-month-long war in Gaza.
Image: Smoke rises in Gaza following an explosion. Pic: Reuters
And Hamas, which runs the coastal Palestinian territory, said on Friday it has responded to the US-backed proposal in a “positive spirit”.
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So what is in the plan?
The plan is for an initial 60-day ceasefire that would include a partial release of hostages held by the militant group in exchange for more humanitarian supplies being allowed into Gaza.
The proposed truce calls for talks on ending the war altogether.
The war in Gaza began after Hamas attacked Israel on 7 October 2023, killing 1,200 people and taking 250 others hostage. Dozens of hostages have since been released or rescued by Israeli forces, while 50 remain in captivity, including about 30 who Israel believes are dead.
The proposal would reportedly see about half of the living hostages and about half of the dead hostages returned to Israel over 60 days, in five separate releases.
Eight living hostages would be freed on the first day and two released on the 50th day, according to an Arab diplomat from one of the mediating countries, it is reported.
Five dead hostages would be returned on the seventh day, five more on the 30th day and eight more on the 60th day.
That would leave 22 hostages still held in Gaza, 10 of them believed to be alive. It is not clear whether Israel or Hamas would determine who is to be released.
Hamas has sought guarantees that the initial truce would lead to a total end to the war and the withdrawal of Israeli troops from Gaza.
A Hamas official has said Mr Trump has guaranteed that the ceasefire will extend beyond 60 days if necessary to reach a peace deal, but there is no confirmation from the US of such a guarantee.
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1:34
Contractors allege colleagues ‘fired on Palestinians’
Possible challenges ahead
And in a sign of the potential challenges still facing the two sides, a Palestinian official from a militant group allied with Hamas said concerns remained.
The concerns were over humanitarian aid, passage through the Rafah crossing in southern Israel to Egypt and clarity over a timetable for Israeli troop withdrawals.
Hamas’s “positive” response to the proposal had slightly different wording on three issues around humanitarian aid, the status of the Israeli Defense Forces (IDF) inside Gaza and the language around guarantees beyond the 60-day ceasefire, a source with knowledge of the negotiations revealed.
But the source told Sky News: “Things are looking good.”
The Times of Israel reported Hamas has proposed three amendments to the proposed framework.
According to a source, Hamas wants the agreement to say that talks on a permanent ceasefire will continue until an agreement is reached; that aid will fully resume through mechanisms backed by the United Nations and other international aid organisations; and that the IDF withdraws to positions it maintained before the collapse of the previous ceasefire in March.
Mr Netanyahu’s office said in a statement that changes sought by Hamas to the ceasefire proposal were “not acceptable to Israel”.
However, his office said the delegation would still fly to Qatar to “continue efforts to secure the return of our hostages based on the Qatari proposal that Israel agreed to”.
Another potential challenge is that Mr Netanyahu has repeatedly said Hamas must be disarmed, which is a demand the militant group has so far refused to discuss.
Hamas has said it is willing to free all the hostages in exchange for a full withdrawal of Israeli troops and an end to the war in Gaza.
Israel rejects that offer, saying it will agree to end the war if Hamas surrenders, disarms and goes into exile – something that the group refuses.
Previous negotiations have stalled over Hamas demands of guarantees that further negotiations would lead to the war’s end, while Mr Netanyahu has insisted Israel would resume fighting to ensure the group’s destruction.
Details of those who have died and those who are missing after US flash floods are slowly emerging – with several young girls among those unaccounted for.
At least 69 people have died from the flooding in Texas, with an unknown number of people – including 11 girls and a counsellor from Camp Mystic in Kerr County – still missing.
As much as 10ins (25cm) of heavy rain fell in just a few hours overnight in central Kerr County on Friday, causing the banks of the Guadalupe River to burst at around 4am local time.
Tributes to those who died, and appeals for those who are still missing, are now being shared.
Image: Officials said 27 girls from Camp Mystic were reported missing after the flash floods in Texas
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3:35
Texas searches for missing children
Who are the victims?
Renee Smajstrla, eight
Image: Renee Smajstrla. Pic: Family handout
Renee’s uncle Shawn Salta confirmed the eight-year-old had died, and said she was one of 700 children staying at Camp Mystic.
“Renee has been found and while not the outcome we prayed for, the social media outreach likely assisted the first responders in helping to identify her so quickly,” he said.
“We are thankful she was with her friends and having the time of her life, as evidenced by this picture from yesterday.
“She will forever be living her best life at Camp Mystic.”
Sarah Marsh, eight
Image: Sarah Marsh. Pic: Family handout
Mountain Brook mayor Stewart Welch confirmed the death of eight-year-old Sarah, from Alabama, who was a pupil at Cherokee Bend Elementary.
“This is an unimaginable loss for her family, her school, and our entire community,” he said. “Sarah’s passing is a sorrow shared by all of us, and our hearts are with those who knew and loved her.
“As we grieve alongside the Marsh family, we also remember the many others affected by this tragedy.”
Eloise Peck and Lila Bonner, both nine
Image: Lila Bonner (left) and Eloise Peck. Pic: Family handout
Eloise’s mother Missy Peck told local broadcaster FOX4 that her daughter and Lila were best friends and cabinmates at Camp Mystic.
Writing about her daughter on Instagram, Ms Peck said: “She lost her life in the tragic flooding… our family is grieving and processing this unimaginable loss together.”
Lila’s family told NBC Dallas Fort Worth, a local affiliate network of Sky’s US partner network, that they were in “unimaginable grief”, and said: “We ache with all who loved her.”
Janie Hunt, nine
Image: Janie Hunt
Janie’s family confirmed her death to a reporter from NBC Dallas Fort Worth, who said “her mother tells me she’s devastated”.
Richard ‘Dick’ Eastland, owner of Camp Mystic
Image: Richard ‘Dick’ Eastland, owner of Camp Mystic. Pic: Family handout
Kerr County judge Rob Kelly told the Washington Post that Mr Eastland, who owned the camp died in a helicopter on the way to a Houston hospital.
Local outlet The Kerrville Daily Times reported he was killed while trying to save the girls from the flash floods.
“It doesn’t surprise me at all that his last act of kindness and sacrifice was working to save the lives of campers,” guest columnist Paige Sumner said in the Daily Times’ tribute to Mr Eastland.
Blair and Brooke Harber, 13 and 11
Image: Blair and Brooke Harber. Pic: Family handout
RJ Harber told CNN his daughters died during flooding in Kerr County, saying Blair “was a gifted student and had a generous kind heart”.
He added that Brooke “was like a light in any room, people gravitated to her and she made them laugh and enjoy the moment”.
He also said both his parents were still missing.
Jane Ragsdale, owner of Heart O’ the Hills camp
Image: Jane Ragsdale. Pic: Heart O’ the Hills
On Heart O’ the Hills’s website, the camp confirmed it was “right in the path of the flood” along the Guadalupe River.
While there were no campers in residence, Jane Ragsdale died. The camp said: “We at the camp are stunned and deeply saddened by Jane’s death.
“She embodied the spirit of Heart O’ the Hills and was exactly the type of strong, joyful woman that the camp aimed to develop with the girls entrusted to us each summer.”
Julian Ryan, 27
Image: Julian Ryan. Pic: GoFundMe
Relatives of Mr Ryan told local news broadcaster KHOU 11 that he died saving his family from floodwaters in Texas Hill County.
They described how he tried to smash a window to help them escape the rising water, but it cut his arm and he bled out before help could arrive.
In common with many parents across the country, here’s a conversation that I have with my young daughter on a semi-regular basis (bear with me, this will take on some political relevance eventually).
Me: “So it’s 15 minutes until your bedtime, you can either have a little bit of TV or do a jigsaw, not both.”
Daughter: “Ummmm, I want to watch TV.”
Me: “That’s fine, but it’s bed after that, you can’t do a jigsaw as well.”
Fast-forward 15 minutes.
Me: “Right, TV off now please, bedtime.”
(Pause)
Daughter: “I want to do a jigsaw.”
Now replace me with the government, the TV and jigsaw options with axing welfare cuts and scrapping the two-child cap, and my daughter with rebellious backbenchers.
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6:36
Rachel Reeves’s fiscal dilemma
That is the tension currently present between Downing Street and Labour MPs. And my initial ultimatum is the messaging being pumped out from the government this weekend.
In essence: you’ve had your welfare U-turn, so there’s no money left for the two-child cap to go as well.
As an aside – and before my inbox fills with angry emails lambasting me for using such a crude metaphor for policies that fundamentally alter the lives of some of the most vulnerable in society – yes, I hear you, and that’s part of my point.
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9:11
Welfare U-turn ‘has come at cost’
For many in Labour, this approach feels like the lives of their constituents are being used in a childish game of horse-trading.
So what can be done?
Well, the government could change the rules.
Altering the fiscal rules is – and will likely remain – an extremely unlikely solution. But as it happens, one of Labour’s proverbial grandparents has just popped round with a different suggestion.
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5:31
Welfare: ‘Didn’t get process right’ – PM
A wealth tax, Lord Neil Kinnock says, is the necessary outcome of the economic restrictions the party has placed on itself.
Ever the Labour storyteller, Lord Kinnock believes this would allow the government to craft a more compelling narrative about whose side this administration is on.
That could be valuable, given one of the big gripes from many backbench critics is that they still don’t really understand what this prime minister stands for – and by extension, what all these “difficult decisions” are in aid of.
The downside is whether it will actually raise much money.
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16:02
Is Corbyn an existential risk to Labour?
The super-rich may have lots of assets to take a slice from, but they also have expensive lawyers ready to find novel ways to keep their client’s cash away from the prying eyes of the state.
Or, of course, they could just leave – as many are doing already.
In the short term, the future is a bit easier to predict.
If Downing Street is indeed now saying there is no money to scrap the two-child cap (after heavy briefing in the opposite direction just weeks ago), an almighty tantrum from the backbenches is inevitable.
And as every parent knows, the more you give in, the harder it becomes to hold the line.