Deutsche Bank optimistic on revenues
Deutsche Bank on Wednesday beat expectations with a surge in second-quarter profits after outperforming rivals in fixed income trading and raised its revenue outlook for next year.
The profit figures are good news for CEO Christian Sewing, who launched a major restructuring in 2019 to return the bank to profitability after a string of regulatory failings. Sewing said in a memo to staff: "The right strategy and hard work do pay off."
Deutsche Bank has lost around 8.2 billion over the past 10 years, but Wednesday's results mark the group's fourth consecutive quarterly profit, its longest streak in the black since 2012.
Finance chief, James von Moltke, told reporters he was bullish about the bank's prospects and that revenue next year would probably be higher than previously forecast - closer to 25 billion euros ($29.52 billion) than a previously targeted 24.4 billion euros.
Deutsche Bank's shares rose as much as 4.7 per cent in early trade. They were 0.7 per cent higher by 0820 GMT.
Net profit attributable to shareholders came in at 692 million euros, from a loss of 77 million euros a year earlier. The figures were better than analyst expectations for a profit of 372 million euros.
"Deutsche Bank's credit positive restructuring is solidly on track," said Moody's analyst Michael Rohr.
The bank decided to abandon a key cost target, which aims to reduce costs to 16.7 billion euros by 2022. The move came after Deutsche Bank flagged a number of unexpected costs in recent months.
Deutsche said it would focus now on a cost-to-income ratio target of 70 per cent.