Deutsche Bank today hammered home why bonuses for its London bankers will be 60% down on last year as it reported group losses of nearly €6 billion (£5.3 billion).

The German giant kicked off the reporting season for European banks on a dismal note with the investment banking division run by London Wall-based Anshu Jain and Michael Cohrs losing a record ¤3 billion in the fourth quarter alone.

Deutsche reported a pre-tax loss for the whole year of €5.7 billion.

The bank's chairman, Dr Josef Ackermann, who has already said he will forgo any bonus this year, said: "We see continuing difficult conditions for the global economy, posing significant challenges for our clients and for our industry."

In what some analysts said was an understatement, he added: " We are very disappointed at our fourth-quarter result. Operating conditions were completely unprecedented, and exposed some weaknesses in our business model."

Deutsche was at the height of its prowess as an investment bank when the credit crisis struck, forcing it to make writedowns in the value of its investments of more than €9 billion.

It has since been hurrying to recreate itself as a less risky retail bank, having struck a deal with the traditional Postbank to give it more depositors.

Sweden's SEB bank today unveiled a rights issue to raise nearly $2 billion (£1.3 billion).