Deutsche Bank share price down despite surprise profit for third quarter
Deutsche Bank share price has dipped in early trading, despite announcing today it was profitable in its third quarter of this year, beating analyst expectations.
The figures
The German bank revealed net income of €278m (£248.2m), a substantial improvement on the €6bn loss it announced for the same period last year.
The lender booked a hefty €13.2bn of non interest expenses during the 2015 period, linked mainly to impairment charges and litigation costs. Non interest expenses in the most recent quarter were comparatively tiny at €6.5bn.
Net revenues also grew to €7.5bn, up two per cent from €7.3bn.
But investors were not impressed, with shares currently trading down 0.8 per cent at €13.19.
Why it's important
Recent years have not been kind to the banking sector, with lower for longer interest rates dragging down revenues and red tape pushing up costs. In response, Deutsche Bank has been making significant efforts to revamp its operations, including the recent sale of Abbey Life to specialist life insurer Phoenix, launching a fintech factory in Frankfurt and making some tough decisions on job cuts.
Deutsche Bank has been in the spotlight for all the wrong reasons recently, after news broke the US Department of Justice fine could set it back as much as $14bn (£11.5bn). Reports emerged earlier this week that a settlement may not be on the cards until January, which may have disappointed investors, as earlier news had pointed towards a settlement before the US presidential election next month.
What Deutsche Bank said
In today's results statement, chief executive John Cryan said the attention the fine negotiations had received recently had unfortunately "overshadowed" the progress the bank was making on restructuring.
"This had an unsettling effect," Cryan continued. "The bank is working hard on achieving a resolution of this issue as soon as possible."