Revamp fails to halt revenue slide at Deutsche Bank

Financial giant’s net profit fell 65% year-on-year between July and September

Germany’s biggest lender Deutsche Bank reported tumbling profits and ebbing revenues in the third quarter yesterday, failing to meet analyst forecasts as its latest restructuring weighs on performance.

Net profit at the Frankfurtbased group fell 65 per cent year-on-year between July and September, to €229 million (Dh959 million), short of analysts’ forecasts for a €240-million bottom line.

But a 9.0-per cent slide in revenues, to €6.2 billion, was more concerning for executives and observers alike.

“We have not yet achieved a turnaround in terms of revenues,” chief executive Christian Sewing told employees in an open letter published on the bank’s website. Over the full year, Deutsche said it expected revenues “slightly lower” than in 2017 — a downgrade from its flat forecast issued at the end of the second quarter.

JP Morgan analysts said Deutsche “has done an excellent job under Sewing in respect to leverage and capital ratio and being on track for cost reduction.”

But they were less confident than the Deutsche boss about the outlook. “We remain concerned about DB’s inability to turnaround ... revenues” in some vital business areas, they warned.

The bank highlighted a socalled “CET1” capital ratio — measuring its buffer to absorb potential losses — of 14 per cent, slightly higher than the previous quarter.