Deutsche Bank reports € 1.9 billion profit before tax in the first quarter of 2023 Profit before tax up 12% year on year to € 1.9 billion, highest quarter since 2013
• Net profit up 8% to € 1.3 billion
• Post-tax return on average tangible shareholders’ equity (RoTE)1 of 8.3% with post-tax return on average shareholders’ equity (RoE) of 7.4%
• Cost/income ratio of 71%, down from 73% in prior year quarter Net revenues grow 5% to € 7.7 billion
• Highest quarter since 2016, despite business exits during transformation
• In line with bank’s revenue growth objectives through 2025
• Net inflows of € 12 billion across the Private Bank and Asset Management Noninterest expenses up 1% year on year to € 5.5 billion
• Adjusted costs flat year on year at € 5.4 billion, with investments in business growth, technology and controls offset by lower bank levies
• Additional efficiency measures underway in front office and infrastructure Capital, risk and liquidity metrics in line with objectives
• Common Equity Tier 1 (CET1) capital ratio rose to 13.6%, from 13.4% in the previous quarter
• Leverage ratio of 4.6%, in line with previous and prior year quarter
• Provision for credit losses of € 372 million, 30 basis points (bps) of average loans; 2023 guidance range of 25-30 bps of average loans reaffirmed
• Liquidity coverage ratio rises to 143%, a surplus of € 63 billion
• Net Stable Funding Ratio rises to 120%, a surplus of € 100 billion Initiatives to accelerate Global Hausbank strategy announced
• Operational efficiency: incremental savings ambition raised from € 2.0 billion to € 2.5 billion through additional measuresCapital efficiency: € 15-20 billion of RWA reductions in lower-yielding portfolios and from optimization, driving returns and shareholder distributions
• Revenue growth: targeted investments in technology, coverage footprint and advisory-focused businesses to tap additional revenue potential
“Our first quarter results demonstrate the relevance of our Global Hausbank strategy to our clients and underscore that we are well on track to meeting or exceeding our 2025 targets,” said Christian Sewing, Chief Executive Officer. “We aim to accelerate execution of our strategy through a number of measures announced today: raising our ambitions for operational efficiency, boosting capital efficiency to drive returns and support shareholder distributions, and seizing opportunities to outperform on our revenue growth targets. Strong organic capital generation enables us to re-affirm our commitment to distributions and we are preparing to conduct further share buybacks later this year.”
Deutsche Bank (XETRA: DBGn.DB / NYSE: DB) today announced profit before tax of € 1.9 billion for the first quarter of 2023, up 12% year on year. Post-tax profit was up 8% to € 1.3 billion. Post-tax return on average tangible shareholders’ equity (RoTE)1 was 8.3%, up from 8.1% in the prior year quarter. Post-tax return on average shareholders’ equity was 7.4% in the quarter, up from 7.2% in the first quarter of 2022. Diluted earnings per share were € 0.61, up from € 0.55 in the prior year quarter. The cost/income ratio improved to 71%, from 73% in the first quarter of 2022. Deutsche Bank’s results include annual bank levies of € 473 million, recognized in the first quarter. Assuming an equal distribution of the annual bank levy across the four quarters of 2023 and a three-month pro rata (three twelfths) share in the first quarter, profit before tax would have been € 2.2 billion and post-tax profit would have been € 1.6 billion in the quarter. Post-tax RoTE1 would have been 10.0% and the cost/income ratio would have been 67%, reflecting substantial progress towards the bank’s 2025 targets for post-tax RoTE1 of above 10% and a cost/income ratio below 62.5%. “In the first quarter, we again proved the strength and resilience of Deutsche Bank in challenging conditions,” said James von Moltke, Chief Financial Officer. “We have delivered well-balanced earnings and growth momentum across four complementary businesses, attracted inflows into investment products and demonstrated balance sheet strength. Our capital and liquidity ratios were stable or improved during the quarter, each significantly ahead of regulatory requirements, and we benefited from the resilience of our funding base, anchored by our strong and well-diversified deposit base.” The bank’s businesses contributed as follows to the bank’s key target ratios:
Release 3 | 10 • Corporate Bank: post-tax RoTE1 of 18.3% and cost/income ratio of 55% • Investment Bank: post-tax RoTE1 of 8.5% and cost/income ratio of 67% • Private Bank: post-tax RoTE1 of 5.3% and cost/income ratio of 78% • Asset Management: post-tax RoTE1 of 13.6% and cost/income ratio of 74%