Dresdner profits slump 90%

LEADING German bank Dresdner has revealed the ravages of last year's global turmoil and delivered a 90% slump in pre-tax profits to e153m (£93.5m).

Profits were hit by an increase of almost 20% to e1.9 billion in provisions against bad debts. The group blamed loans to middle-market US companies and said it had been cutting back its portfolio in this area since the middle of 2000. Administrative expenses rose 13.5% to e8.7 billion.

One-off restructuring and integration costs were e620 million, down more than a third from 2000.

The bank, which owns investment bank Dresdner Kleinwort Wasserstein, said 7,800 jobs had gone since May 2000 and that the number of German branches had fallen by 183 to 805. 'The turnround has begun,' said Dresdner.

The dividend has been reduced by a quarter to 70 cents but the group is confident that there will be 'a sustained improvement'.

DKW suffered from the defection of chairman Bruce Wasserstein to Lazards last year. Nonetheless, the parent group intends to focus on its corporate and markets divisions as well as private and business clients.