by Deutsche Bank offices in the City of London on July 2, 2024, in London, United Kingdom
Mike Kemp | In pictures | Getty Images
German Bank On Wednesday, the group ended a 15-quarter profit streak with a smaller-than-expected loss after setting aside a provision for an ongoing lawsuit involving its Postbank division.
The net loss attributable to shareholders was 143 million euros ($155.1 million), compared with an LSEG analyst poll that predicted a loss of 145 million euros.
Deutsche Bank had already said it would take a hit in the quarter from the provision for losses on Postbank, which would amount to 1.3 billion euros, it confirmed on Wednesday. The lawsuit filed by long-time investors accuses Deutsche Bank of underpaying for the acquisition of the retail banking giant in 2010.
Deutsche Bank said its net revenue rose 2 percent to 7.6 billion euros in the second quarter, while efficiency savings reached 1.5 billion euros.
Revenues from its investment banking division, a recent area of strength, jumped 10% year-on-year to €2.6 billion.
Other highlights:
- Pre-tax profit excluding Postbank provisions amounted to EUR 1.7 billion, compared to EUR 1.4 billion in the second quarter of 2023.
- Provisions for credit losses amounted to 476 million euros, compared to 401 million euros a year ago.
- The CET 1 capital ratio, a measure of bank solvency, increased to 13.5% from 13.4% in the first quarter of the year.
“These results reflect the operational strength of Deutsche Bank,” Deutsche Bank CEO Christian Sewing said in a statement.
“During the first half of the year, our underlying profitability was the highest since 2011, demonstrating the success of our strategic execution.”
The second quarter results confirm the bank’s upward trend in profits. Last April, the bank recorded a 10% increase in profits, recording its best quarterly result for this indicator since 2013.
The bank came under heavy criticism last week, with German regulators criticizing Deutsche Bank for incorrectly disclosing deferred tax assets in its 2019 financial statements that did not comply with international accounting standards.
German regulator BaFin has estimated that around €2.076 billion in deferred tax assets were not separately disclosed in notes relating to Deutsche Bank’s US operations.
