Deutsche Bank said this morning its third-quarter profits rose 31 per cent as tax credits and gains from asset sales outweighed the first loss at its investment bank in five years.
Net income climbed to €1.62 billion ($2.34 billion), or €3.31 a share, from €1.24 billion, or 2.43, a year earlier, the Frankfurt-based company said in a statement today.
Deutsche Bank estimated on October 3rd that net income would exceed €1.4 billion. Gains from German tax changes and the sale of Deutsche Bank's North American headquarters cushioned the impact of €2.16 billion in writedowns and trading losses linked to the US subprime mortgage contagion.
Deutsche Bank's shares have declined 12 per cent this year, compared with a 9.1 per cent slump in the 63-member Bloomberg Europe Banks and Financial Services Index.
The bank's stock trades at 7.96 times estimated profit, the fourth-lowest among the 50 financial companies closest to Deutsche Bank by market value globally, data compiled by Bloomberg show.
Chief executive officer Josef Ackermann said in the statement that, "looking forward, challenges undoubtedly remain. We have made a positive start to the fourth quarter, and assuming markets function at normal levels, we re-affirm our commitment to delivering on our 2008 financial targets."
Sales and trading revenue, which accounted for almost half the bank's total last year, slumped 62 per cent after €1.56 billion in writedowns and trading losses in fixed-income and equities.
Agencies