Deutsche Bank has reported a surprise swing into net profit in the third quarter and upgraded the revenue outlook for its investment bank, despite navigating an ongoing restructuring and the Covid pandemic.
The bank reported profit attributable to shareholders of €182m for the three months from July to September compared with a loss of €942m the same time a year ago.
Germany's largest lender last posted a quarterly profit in January-March 2019, and this time was in part helped by strength at its investment banking division.
Deutsche has lost money for the past five years and is hoping to reverse its fortunes through an overhaul by shedding staff, exiting some businesses and cutting costs.
Analysts have said the overhaul is starting to show its benefits, although uncertainties linked to Covid-19 cloud its outlook.
"Our more focused business model is paying off and we see a substantial part of our revenue growth as sustainable," chief executive Christian Sewing said.
A bright spot in Deutsche's earnings report was its investment bank, where revenue climbed 43%, boosted by a 47% rise in fixed income and currencies.
By comparison, investment banking revenue at US banks rose 21% in the quarter, according to Barclays.
Deutsche Bank said it now expects "significantly higher" revenue at the investment bank for 2020, compared with previous guidance of just "higher".
Investment bank revenue has been helped by volatility in markets that spurs trading.
"We see our revenue growth in the investment bank as much more than just market driven," Sewing plans to tell analysts later today, according to a transcript of his comments.
Some Deutsche bankers have cautioned that investment bank revenues may slow somewhat next year.
Executives are also closely watching how credit losses accumulate after government-run programmes that have helped businesses and consumers through the pandemic begin to taper off.
