FRANKFURT, July 27 (Reuters) – Deutsche Bank (DBKGn.DE) posted second-quarter pretax profit in line with expectations, helped by lower loan loss provisions amid weaker industry trends in investment banking.
Deutsche’s corporate banking and securities division, which posted 779 million euros ($1.01 billion) in pretax profit, and global transaction banking with 478 million euros, accounted for the lion’s share of 1.52 billion in group pretax ea¦rnings, Germany’s biggest lender said on Tuesday.
Both divisions are now run by 47-year old Anshu Jain, who took sole control of the investment bank on July 1.
Deutsche performed less strongly than in the first quarter, but 16 percent stronger than during the year-earlier period, mirroring a trend among U.S. peers like Goldman Sachs (GS.N) and Morgan Stanley (MS.N). [ID:nN19193014] [ID:nN21197777] [ID:nSGE66K0EM]
Deutsche’s other divisions, which include a wealth management and an asset management unit, turned a profit but failed to counterbalance the German lender’s dependence on the division run by cricket fanatic Jain.
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Analysts polled by Reuters had estimated that Germany’s biggest lender would earn 1.6 billion euros in pretax profit in the quarter ended in June. [ID:nLDE66M15I]
Deutsche Bank, which posted a second-quarter net profit of 1.2 billion euros and revenues of 7.2 billion, reiterated it aims to achieve 10 billion in pretax profit at the group level next year. [ID:nLDE5BD25R]
According to Thomson Reuters StarMine, Deutsche Bank trades at 6.6 times 12-month forward earnings, a discount to Swiss peers Credit Suisse (CSGN.VX) and UBS (UBSN.VX), which trade at multiples of 7.8 and 8.8, and to U.S. rivals Morgan Stanley (MS.N) and Goldman Sachs (GS.N), which trade at multiples of 8.4 and 8.7.
UBS also published forecast beating results on Tuesday. [ID:nLDE66P0CS] (Reporting by Edward Taylor)