Deutsche Bank Profit More Than Doubles -- Update
April 27 2017 - 2:24AM
Dow Jones News
By Jenny Strasburg
Deutsche Bank AG on Thursday reported a solid rise in net profit
in the first quarter, in its first results since its $8.5 billion
capital increase.
The German lender reported net income of EUR575 million ($627
million) in the quarter, compared with EUR236 million for the same
period last year and in line with expectations.
Revenue was EUR7.3 billion, a 9% decrease from last year.
Revenue was roughly flat when adjusted for the impact of credit
spreads.
The results are Deutsche Bank's first since it completed an $8.5
billion capital increase earlier this month in conjunction with
strategic changes announced in March.
The fundraising, Deutsche Bank's third sale of new shares since
2013, put to rest many investors' immediate concerns about the
lender's capital buffers. The bank is also reuniting its
corporate-finance and deal-advisory business with its trading unit
under two investment-banking co-heads, less than two years after
splitting the businesses apart.
Chief Executive John Cryan said in a statement that cost-cutting
efforts are paying off, and "asset flows are returning across the
bank." Deutsche Bank suffered client defections in the third and
fourth quarters of 2016 amid concerns about its capital buffers and
pending legal settlements.
Debt-trading revenue increased, particularly in interest rates
and credit trading, while stock-trading revenue declined largely
due to late-2016 outflows of clients in the bank's prime-services
unit, which finances trades for hedge funds and other clients.
Deutsche Bank also was hurt by higher costs to fund its trading and
client-financing businesses.
Investment-banking revenue was mostly unchanged. The process of
cutting clients in some areas hit revenue slightly, as it has in
recent quarters. Asset-management revenue declined, while revenue
increased in the private and commercial client banking
business.
Write to Jenny Strasburg at jenny.strasburg@wsj.com
(END) Dow Jones Newswires
April 27, 2017 02:09 ET (06:09 GMT)
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