2024-04-26 07:12:02
The figures from Germany’s largest financial institution are better than expected. But not everything is rosy in the interim results.
Deutsche Bank achieved an increase in profits at the start of 2024 despite higher provisions for possible risks.
The pre-tax profit increased by ten percent in the first three months compared to the same quarter of the previous year to just over two billion euros, as the Frankfurt DAX group announced. The bottom line was a net profit attributable to shareholders of around 1.3 billion euros – ten percent more than a year ago. The results were slightly better than analysts expected on average; CEO Christian Sewing spoke in the announcement of the “best result since 2013”.
Cuts 3,500 jobs by the end of 2025
However, after a decline in profits in 2023, Deutsche Bank will have to stretch to achieve its medium-term goals. It was only at the beginning of February that Sewing announced that it would cut 3,500 jobs by the end of 2025. This includes 800 jobs that the bank had already announced last year.
The problems in the commercial real estate market and at Postbank also continue to be a burden. Deutsche Bank set aside 439 million euros for possible setbacks in the first quarter, 18 percent more than a year earlier. For the year as a whole, the group expects risk provisions to be at the same level as the previous year.
The tailwind from the sharp rise in interest rates, from which Deutsche Bank and other financial institutions benefit, has already diminished somewhat, as the interim balance for the first quarter shows. However, Germany’s largest financial institution was able to compensate for the lower net interest income through increasing commission income in all business areas.