Deutsche Bank defies Covid-19, posts surprise profit

A statue is pictured next to the logo of Germany's Deutsche Bank in Frankfurt. — Reuters pic
A statue is pictured next to the logo of Germany's Deutsche Bank in Frankfurt. — Reuters pic

FRANKFURT, Oct 28 ― Deutsche Bank today swung to a surprise net profit in the third quarter as it shook off losses driven by the coronavirus pandemic and ploughed on with a wide-ranging restructuring.

Germany's largest lender posted a net profit of €182 million (RM890.5 million), compared with a loss of €942 million in the same period of the previous year.

The results beat expectations for a loss of €82 million, based on a survey by FactSet, as Deutsche Bank started to move on from years of poor management and overblown investment banking ambitions with a transformation plan that launched last year.

“Our more focused business model is paying off,” the bank's chief executive Christian Sewing said.

“We not only demonstrated continued cost discipline, but also our ability to gain market share,” Sewing added.

Last year, the bank said it would cut 18,000 jobs, and figures released Wednesday show that it has already shed around 3,000 positions.

Deutsche said in September that it would shutter around 100 branches, cutting its high-street presence by a fifth, “reflecting changes in customer behaviour patterns”.

For the nine months to September, net profit was €62 million, compared with a net loss of €4.1 billion at the same point in 2019, when early provisions for its restructuring hit the business.

Deutsche Bank kept its 2020 outlook, as it lowered its provision for loan losses compared with the lockdown-hit second quarter.

The Frankfurt-based institution set aside €273 million, 56 per cent more than last year, but significantly less than €761 million in the three months to June when pandemic-induced restrictions closed businesses and factories.

The group's third quarter results were once again driven by investment banking, which brought in €2.4 billion, up 43 per cent year-on-year. ― AFP

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