Germany's financial regulator, BaFin, has appointed a special representative to oversee Deutsche Bank's operations, specifically focusing on improving customer service at its Postbank and DSL Bank branches. The announcement was made on Monday. The move was taken to protect the collective interests of consumers, following a series of complaints related to IT changeover issues.
The special representative will monitor Deutsche Bank's progress in processing customer orders swiftly and efficiently. Any pending customer orders are to be dealt with promptly. This appointment comes after the regulator had openly reprimanded the institution for its shortcomings.
Deutsche Bank has acknowledged the situation and expressed its commitment to work closely with both the regulator and the appointed representative. The primary goal is to restore the expectations of regulators and customers affected by these inconveniences as quickly as possible, according to a spokesperson from Deutsche Bank.
The bank is reportedly making progress in improving processing times at Postbank. To bolster this effort, approximately 400 additional employees have been deployed in customer service, with plans to add several hundred more full-time employees throughout October.
The issues began following an IT changeover that merged data from twelve million Postbank customers and seven million Deutsche Bank customers in Germany onto a common platform since Easter 2022. This transition led to significant problems, particularly with accounts designed to protect credit balances from seizure for individuals in debt, and issues surrounding the disbursement of construction financing at subsidiary DSL.
In the midst of these challenges, Deutsche Bank has a market cap of $22270.37 million and has seen an 8.7% revenue growth, according to InvestingPro Data. It's also worth noting that the bank's P/E ratio stands at 4.44, and it's trading at a low price/book multiple of 0.29, indicating that the shares might be undervalued. Deutsche Bank has also shown a promising 1 Year Price Total Return of 41.04%, a clear indication of its resilience in the financial market.
Deutsche Bank CEO Christian Sewing has apologized for the problems, stating that normal operations on critical issues such as garnishment protection accounts are expected to be restored in October. Sewing also sees a similar trend for loan disbursements. He mentioned that clearing all backlogs would require not only the third quarter but also the fourth quarter of this year.
According to InvestingPro Tips, Deutsche Bank is a prominent player in the Capital Markets industry, consistently increasing its earnings per share, despite suffering from weak gross profit margins. The bank's net income is expected to drop this year, but analysts predict the company will remain profitable. For more insights, visit InvestingPro which provides additional tips for investors.
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