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Dresdner 3Q profit drops
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November 2, 2000: 10:44 a.m. ET
German bank hurt by effort to retain staff, bank closures; profit falls 18%
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LONDON (CNNfn) - Dresdner Bank AG said Thursday its third-quarter profit fell 18 percent as Germany's third-largest bank coughed up money to retain staff at its investment bank and closed branches.
Net income fell to  172 million ($147.7 million), or 0.34 a share, from 211 million, or 0.40 a share a year ago. Net income for the nine months to Sep. 30 fell to 586 million ($503 million), or 1.10 a share, from 701 million, or 1.33 a share, a year ago. Pretax profit fell 25 percent to 911 million from 1.21 billion.
Analysts polled by Reuters had expected nine-month net profit of around 549 million and pretax profit in the area of 957 million.
 The Frankfurt-based bank is regarded as a potential take over target after failing to merge with rivals Deutsche Bank AG (FDBK) and Commerzbank AG (FCBK). It has been forced to pay huge bonuses to retain key staff at investment bank Dresdner Kleinwort Benson.
"Dresdner has not been able to fully recover since its failed merger attempts," said analyst Dieter Hein at Credit Lyonnais in Frankfurt, who held his investor recommendation unchanged at "reduce."
Dresdner announced a 3.5 billion restructuring plan in May to slash a quarter of its branch network, with the possible loss of some 5,000 jobs, in an attempt to restore credibility and profitability. The company dished out 80 million in the third-quarter to pay for the closure of 300 bank branches.
Dresdner also said nine-month income was impacted by an 18.3 percent increase in administrative expenses. In another blow, Dresdner announced a surprise 300 million write-down in real estate assets at one of its mortgage units.
"We should point out that, this year, we are faced with an extraordinary burden comprising the expense to secure our competitive position," the bank said. The "expense to secure our long-term competitive position totaled 489 million, while the restructuring charge amounted to 330 million."
Dresdner, which agreed to buy New York merger and acquisition adviser Wasserstein Perella & Co. for about $1.4 billion in September, said pretax profit at its investment bank jumped 27 percent to 1 billion.
Shares in Dresdner fell 1.1 percent, or 0.51 to 48.04 in afternoon trade in Frankfurt. 
--from staff and wire reports
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Dresdner Bank
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