German bank, Deutsche Bank, records its highest earnings since the year 2007
In a significant turnaround, Deutsche Bank has reported its highest quarterly profit since 2007, marking a remarkable comeback under CEO Christian Sewing. The bank's second-quarter profit stood at almost 1.5 billion euros, and the net profit in the first half of the year reached almost 3.3 billion euros.
The profit increase was achieved despite falling interest rates, demonstrating the bank's resilience and strategic initiatives. The bank's return on tangible equity was 10.1 percent in the second quarter and 11 percent in the first half of the year.
All business areas of the bank contributed to the latest profit increase: corporate banking, investment banking, private customer banking, and DWS. Investment banking, in particular, contributed the most pre-tax profit in the first half of the year.
Deutsche Bank's total income also surpassed analysts' expectations, increasing by six percent to 16.3 billion euros in the first half of the year. The bank plans to spend more on buying back its own shares this year, signalling confidence in its future growth prospects.
The bank announced it would cut around 2,000 jobs this year and further reduce the number of branches as part of its ongoing cost-cutting measures. Despite these measures, Deutsche Bank's total costs across the group consumed only 62.3 percent of revenues in the first half of the year, indicating improved efficiency.
After adjusting for special items, Deutsche Bank kept its costs nearly stable in the first half of the year at 10.1 billion euros. This discipline in cost management, coupled with the strong revenue growth, has put the bank on track to achieve significantly more profit this year.
CEO Christian Sewing set a target of 32 billion euros for the full year and now sees this target within reach. The bank's share price rose sharply to its highest level in ten years on Thursday, reflecting investor confidence in the bank's turnaround.
The long-troubled Deutsche Bank has made a comeback in recent years under CEO Christian Sewing, and this latest profit report is a testament to the bank's progress. By leveraging natural body rhythms and managing workload with intentional breaks and focus blocks, the bank seems to be effectively maximizing its productivity and efficiency.
In light of the bank's progress, it's evident that the industry, finance, and business sectors have all contributed to Deutsche Bank's increased profitability, with investment banking being a significant contributor. The bank's strategy of focusing on productivity and efficiency has resulted in its ability to achieve strong revenue growth despite challenging conditions.
