Deutsche Bank Q3 Pre-tax Profit Rises, Sees Revenue Growth In FY23; Stock Up

Deutsche Bank AG shares were gaining around 7 percent in the morning trading in Germany as well as in pre-market activity on the NYSE after the German banking major on Wednesday reported higher pre-tax profit in its third quarter, the highest for any third quarter since 2006, driven by revenue strength. On an after tax basis, profit declined.

Looking ahead for fiscal 2023, the bank expects revenues of around 29 billion euros, higher than prior year’s revenues of 27.2 billion euros.

Further, for the full year 2023, Deutsche Bank reaffirmed its expectation for provision for credit losses to be at the upper end of its communicated range of 25- 30 bps.

Christian Sewing, Chief Executive Officer, said, “These results demonstrate strong and sustained business growth momentum combined with continued cost discipline. Furthermore, we have materially improved our capital outlook thanks to our strong results and focused capital efficiency measures. This gives us scope to invest in growing our Global Hausbank model, further improve returns, and
increase and accelerate distributions to our shareholders.”

For the third quarter, profit attributable to its shareholders was 1.03 billion euros, down 8 percent from 1.12 billion euros in the same quarter last year.

Profit before tax, however, grew 7 percent to 1.72 billion euros from 1.62 billion euros a year ago.

Provision for credit losses were 245 million euros, down 30 percent from last year’s 350 million euros. Noninterest expenses were 5.2 billion euros in the third quarter, up 4 percent year on year.

Quarterly net revenues were 7.13 billion euros, up 3 percent from last year’s 6.92 billion euros. The growth was 6 percent after adjusted for specific items.

Corporate Bank net revenues were 1.9 billion euros, up 21 percent year on year. All segments delivered double-digit year-on-year growth, driven by strong net interest income and continued pricing discipline.

Investment Bank net revenues were 2.3 billion euros in the quarter, down 4 percent year on year and essentially flat if adjusted for reduction in DVA benefit.

Private Bank net revenues were 2.3 billion euros, up 3 percent year on year and up 9 percent if adjusted for the non-recurrence of Sal.

Asset Management net revenues fell 10 percent to 594 million euros in the third quarter, mainly due to lower performance fees, the mark-to-market of co-investments and FX movements.

Assets under management rose slightly to 860 billion euros during the quarter.

In Germany, Deutsche Bank shares were trading at 10.13 euros, up 6.64 percent. In pre-market activity on the NYSE, the shares were trading at $10.73, up 6.66 percent.

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