FILE PHOTO – The headquarters of Germany’s Deutsche Bank are seen early evening in Frankfurt, Germany January 31, 2017. REUTERS/Kai Pfaffenbach/File Photo
FRANKFURT (Reuters) – Standard & Poor’s left its ratings on Deutsche Bank unchanged on Monday and said profitability is the lender’s biggest hurdle.
The bank’s earnings for the fourth quarter, announced on Friday, “confirm our view that management’s biggest challenge is to improve profitability and bolster the bank’s customer franchise”, S&P said in a statement.
Deutsche Bank’s ratings have been under pressure as the bank restructures under new management.
The bank is doing everything it can to make sure global agencies don’t further cut ratings, Deutsche’s Chief Financial Officer James von Moltke said on Friday.
S&P rates Deutsche Bank’s long-term credit at BBB+ after cutting it last year from A-.
Moody’s, another rating agency, said on Friday that Deutsche’s earnings were in line with expectations but that the bank’s ability to rebuild and stabilize revenue in the coming quarters “will be paramount to the long-term success of its restructuring plan” and remains a work in progress.
Fitch said its negative outlook for Deutsche “reflects our view that it continues to face challenges in reaching its strategic targets in 2019, in particular with respect to improving its profitability.”
Reporting by Tom Sims,; Editing by Tassilo Hummel and Michelle Martin