Deutsche Bank posts best quarter in seven years

The German lender reports pre-tax profits of €1.6bn

Photo: EPA The logo of the Deutsche Bank at the bank headquarters in Frankfurt, Germany

Deutsche Bank posted its best quarterly figures in seven years, booking pre-tax profits for the first quarter at €1.6bn ($1.9bn) in figures released before the start of trading on Wednesday. According to the estimates, Deutsche Bank shares also rose by more than 7% to €10.90 by midday, helping to drive generally positive sentiment on the Frankfurt Stock Exchange.

"We can not only look back on an outstanding quarter; the future outlook is also positive," chief executive officer Christian Sewing said.

A little over €1bn has to be subtracted in interest payments for certain loans, leading to profits attributable to shareholders of €908m. The figures provided a sharp contrast to the loss of €43m recorded in the first quarter of last year.

Despite that poor start, Germany's largest bank managed to post a profit of €624m for the full year of 2020 for the first time since 2014, with €113m attributable to shareholders.

"Our first quarter is further evidence that Deutsche Bank is on the right path in all four core businesses, and is building sustainable profitability," Sewing said.

"In addition to substantial revenue growth over an already-strong prior year quarter, we demonstrated cost and risk discipline," he added. "These results give us confidence that we'll reach our 2022 targets."

During a phone conference with journalists, chief financial officer James von Moltke declined to make concrete predictions for the year as a whole, but indicated he expected a higher profit figure than that for 2020.

"Considerably fewer funds would have to be set aside for non-performing loans, while yields would remain steady," he predicted, as citied by dpa.

Sewing also said the bank believed that the consequences of the current low interest rates would have a reduced impact on yields from private clients and business than last year.

"While market conditions were expected to "normalize" over the months ahead, Deutsche Bank was expecting yields similar to those in the extremely strong first quarter," he commented.

The bank, which ran foul of US and European regulators over recent years, incurring huge fines, is in the midst of a cost-cutting drive that includes the closure of much of its domestic branch network.

Similar articles

  • IMF approves largest expansion to fight pandemic

    IMF approves largest expansion to fight pandemic

    The executive board of the International Monetary Fund approved on Friday a $650bn expansion in resources in an effort to support economically vulnerable nations as they battle the Covid-19 pandemic. As noted by IMF Managing Director Kristalina Georgieva, that the new support is the largest such expansion in the history of the 190-nation lending institution but it would be a “shot in the arm for the world.”

    57
  • UK swings global tax rules to exempt financial services

    UK swings global tax rules to exempt financial services

    UK scored a decisive win over the global tax rules, agreed at the G7 summit earlier last month, Reuters reported. London managed to earn an exemption for financial services from a new global tax system. The new global corporate taxation was planned to press multinational companies to pay more. However UK Treasury Secretary Rishi Sunak passed a deal for financial service firms to be exempt to help protect the City of London's largest banks from paying more tax.

    69