Deutsche Bank profit report reflects challenges
Deutsche Bank, Europe’s largest investment bank, has released its profit figures, reporting a 30% decline of income before tax compared to the previous year, net income dropped by 34% to €1.08 bn. Nevertheless, shares rose as the report outperformed predictions.
Key factors for the current challenges are the persistent uncertainties over the situation in the Ukraine and changes in monetary policy.
A strong decline was notable in Corporate Banking and Securities, which fell by 22% before tax and in the Asset and Wealth Management Segment, where income before tax dropped by 23%.
The bank has been facing pressure to raise its capital levels by selling shares in order to in order to meet tighter restrictions on leverage.
Deutsche Bank’s Core Tier 1 ratio under Basel III rules now stands at 9.5 %, which represents a 0.2 % reduction compared to last year.
Reflecting of the current market volatility, Deutsche Bank’s shares in Frankfurt rose by 3.3. %, reflecting the strongest growth in 3 months, since the figures beat expectations.
In response to these challenges, Deutsche Bank has now announced to sell at least €1.5 bn of notes that can incur losses in crisis in order to help the firm meet the tightened restrictions on leverage.