Deutsche Bank has reported revenue and profit growth in its second quarter of trading, noting it remains “on track” with an ambitious transformation despite ongoing restructuring and the impact of Covid.
Group pre-tax profit was €158m (£143m) in the second quarter, a marked improvement from the pre-tax loss of €946m (£856m) reported in the second quarter of 2019, which followed goodwill impairments and other transformation-related effects.
Its latest trading update reported that group net revenues rose by 1% to €6.3bn (£5.7bn), while Core Bank net revenues were up 6% to €6.4bn. Meanwhile, Investment Bank net revenues surged by 46% year-on-year to €2.7bn (£2.44bn), while revenues in the FIC sales and trading business increased by more than 75%.
Rates recorded its best second-quarter revenues for a decade, while both Foreign Exchange and Emerging Market revenues saw “significant” year-on-year growth.
This revenue growth, combined with continued progress on cost reductions across the group, was “sufficient” to offset a rise in provision for credit losses to €761m (£688m) in the period.
While this was an increase against the €506m (£458m) provision set aside the year prior, it was nonetheless in line with management expectations, and a reflection of the current weaker macro-economic outlook.
In addition, the group welcomed a net profit of €61m (£55m) versus the net loss of €3.1bn (£2.8bn) in the prior year quarter, which again followed transformation-related effects.
While Deutsche Bank made a loss attributable to its shareholders of €77m (£70m), this was down from the loss of €3.3bn (£3bn) the year prior, and a shallower loss than expected by analysts.
Christian Sewing, CEO said: “In a challenging environment we grew revenues and continued to reduce costs, and we’re fully on track to meet all our targets.
“This enabled us to more than offset higher provision for credit losses and remain profitable while supporting clients through difficult conditions. Our strong capital position not only demonstrates our resilience, but also gives us scope for growth.”