Deutsche Bank Q3 Net Profit More Than Doubles; Revenues Down

On October 26, 2017, Deutsche Bank reported that its third-quarter net income more than doubled to 649 million euros, up from 278 million euros during the same period in 2016. Operating profit for the quarter rose 51 percent to 933 million euros.

Despite the profit growth, total revenue fell 7 percent to 6.8 billion euros, matching analysts’ forecasts. The bank attributed the decline to a challenging revenue environment characterized by low market volatility, depressed trading volumes, and persistent low interest rates. While the private and commercial banking division saw revenues rise by 3 percent and asset management remained stable, investment banking revenues dropped nearly a quarter to 475 million euros due to declines in underwriting and advisory services.

The bank also reported lower revenues in rates, foreign exchange, and emerging markets. Credit revenues fell significantly amid less active trading conditions. Amid these challenges, the lender is continuing a prolonged restructuring process, which includes plans to integrate its Postbank retail unit with its in-house consumer bank.

The restructuring strategy has faced opposition, with labor unions threatening strikes over planned branch closures and an unspecified number of job cuts. A capital markets consultancy executive noted that the bank still has a long way to go.