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Deutsche Bank (DB) Completes Technical Integration of Postbank
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Deutsche Bank AG (DB - Free Report) announced the completion of the fourth and final phase of the technological integration of Postbank. DB had begun the acquisition of Postbank in 2008 during the financial crisis but faced various hurdles in completing its integration over the years.
Now, DB will initiate decommissioning Postbank’s hardware and software, leading to cost savings. The integration is expected to result in cost savings in 2023 and 2024. Further, DB expects annual savings of €300 million from 2025.
Due to the integration, certain customers did not have access to all services over the last weekend.
Deutsche Bank has been undertaking strategic acquisitions to support growth. Recently, Deutsche Bank entered into a definitive agreement to acquire Numis in an all-cash transaction. Closing of the deal, subject to Numis’s shareholders’ approval and other customary conditions, is expected in fourth-quarter 2023.
Deutsche Bank expects the deal to be accretive to EPS from 2024. Also, it is likely to deliver an attractive return on regulatory capital consumed. It is expected to reduce the CET1 ratio by approximately 9 basis points.
Apart from these acquisitions, DB has been undertaking measures to reduce its expense base. Total non-interest expenses recorded a negative CAGR of 3.4% over the last four years (ended 2022). However, the metric increased in first-quarter 2023. Nonetheless, the company has been implementing efficiency measures across the front office and infrastructure.
The company is dedicated to keeping its cost base flat in 2023 compared with 2022 levels by managing its expenses. These efforts are likely to support bottom-line growth in the upcoming period.
Shares of DB have lost 14.1% on the NYSE over the past six months compared with the industry’s growth of 6.2%.
Inorganic Expansion Efforts by Others in the Finance Sector
JPMorgan Chase & Co. (JPM - Free Report) has formed a strategic alliance with Cleareye.ai, a financial technology firm focused on trade finance. Trade finance refers to the financial products offered by institutions that seek to facilitate global trade by reducing counterparty risk between importers and exporters.
JPM’s investment in Cleareye.ai leverages the ClearTrade platform, solving the challenges faced by trade finance (the industry is undergoing a digital transformation).
Tradeweb Markets Inc. (TW - Free Report) , a leading global operator of electronic marketplaces and money markets, entered into a definitive agreement to acquire Yieldbroker, a prominent Australia-based trading platform, in an all-cash transaction of A$125 million. The deal's closing, subject to customary conditions and regulatory reviews, is expected by the end of this year.
The transaction will facilitate a more liquid, transparent and efficient fixed-income market by bringing together innovative trading solutions and deep industry experience of both companies. Hence, the acquisition aligns with TW’s mission to make markets more efficient.
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Deutsche Bank (DB) Completes Technical Integration of Postbank
Deutsche Bank AG (DB - Free Report) announced the completion of the fourth and final phase of the technological integration of Postbank. DB had begun the acquisition of Postbank in 2008 during the financial crisis but faced various hurdles in completing its integration over the years.
Now, DB will initiate decommissioning Postbank’s hardware and software, leading to cost savings. The integration is expected to result in cost savings in 2023 and 2024. Further, DB expects annual savings of €300 million from 2025.
Due to the integration, certain customers did not have access to all services over the last weekend.
Deutsche Bank has been undertaking strategic acquisitions to support growth. Recently, Deutsche Bank entered into a definitive agreement to acquire Numis in an all-cash transaction. Closing of the deal, subject to Numis’s shareholders’ approval and other customary conditions, is expected in fourth-quarter 2023.
Deutsche Bank expects the deal to be accretive to EPS from 2024. Also, it is likely to deliver an attractive return on regulatory capital consumed. It is expected to reduce the CET1 ratio by approximately 9 basis points.
Apart from these acquisitions, DB has been undertaking measures to reduce its expense base. Total non-interest expenses recorded a negative CAGR of 3.4% over the last four years (ended 2022). However, the metric increased in first-quarter 2023. Nonetheless, the company has been implementing efficiency measures across the front office and infrastructure.
The company is dedicated to keeping its cost base flat in 2023 compared with 2022 levels by managing its expenses. These efforts are likely to support bottom-line growth in the upcoming period.
Shares of DB have lost 14.1% on the NYSE over the past six months compared with the industry’s growth of 6.2%.
Image Source: Zacks Investment Research
Currently, DB carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Inorganic Expansion Efforts by Others in the Finance Sector
JPMorgan Chase & Co. (JPM - Free Report) has formed a strategic alliance with Cleareye.ai, a financial technology firm focused on trade finance. Trade finance refers to the financial products offered by institutions that seek to facilitate global trade by reducing counterparty risk between importers and exporters.
JPM’s investment in Cleareye.ai leverages the ClearTrade platform, solving the challenges faced by trade finance (the industry is undergoing a digital transformation).
Tradeweb Markets Inc. (TW - Free Report) , a leading global operator of electronic marketplaces and money markets, entered into a definitive agreement to acquire Yieldbroker, a prominent Australia-based trading platform, in an all-cash transaction of A$125 million. The deal's closing, subject to customary conditions and regulatory reviews, is expected by the end of this year.
The transaction will facilitate a more liquid, transparent and efficient fixed-income market by bringing together innovative trading solutions and deep industry experience of both companies. Hence, the acquisition aligns with TW’s mission to make markets more efficient.