LONDON (Reuters) – Credit Suisse and Deutsche Bank will be dropped from the STOXX Europe 50 index from Monday next and replaced by technology firm ASML Holding and construction company Vinci.
STOXX, which operates Deutsche Boerse Group’s index business, said late on Monday that the changes will become effective from August 8.
The Europe 50 index is designed the track Europe’s 50 biggest companies. The dumping of the two banks follows a more than 45% slump in shares of both Credit Suisse and Deutsche Bank so far this year.
Both are going through painful restructuring, cutting back on many services and markets.
Deutsche Bank has tried to simplify its business, cut costs and reduce litigation and fines from poor conduct, as part of a plan started in October last year by new CEO John Cryan.
The firm has scaled back on businesses that use a lot of regulatory capital, such as trading and markets, to free up resources. But this has led to a big drop in profits — from €800 million to just €20 million in the second quarter of this year.
Credit Suisse is similarly trying to scale back operations and was hit by plunging client activity and difficult market conditions, as well as write-offs, at the start of the year. However, last week it announced a surprise second quarter profit.
Here’s how the shares of both banks look:
(Reporting by Atul Prakash)
The post A humiliating sign of just how tough things are for Deutsche Bank and Credit Suisse appeared first on Business Insider.