Financial Results

Strong Wealth, Asset Management Results A Ray Of Sunshine For Deutsche Bank

Tom Burroughes Group Editor 29 October 2013


Deutsche Bank, Germany’s largest bank which has a significant presence in the Americas, said today that its Deutsche
Asset & Wealth Management arm enjoyed one of its strongest-ever
performances, logging pre-tax income of €283 million ($390.2 billion) in the
third quarter of 2013, a 151 per cent year-on-year increase attributable to a
12 per cent decline in non-interest expenses.

In the third quarter, the cost/income ratio at this business
division fell sharply to 78 per cent in Q3 compared with 90 per cent in the
same three months of 2012.

Net revenues were €1.264 billion, a 29 per cent year-on-year
rise, the Frankfurt-listed firm said in a statement today.

Invested assets fell by €9 billion to €934 billion,
primarily due to foreign exchange rate movements and outflows of low margin
assets, partially offset by positive market effects, Deutsche Bank said.

The generally strong performance of the wealth management
business stands in sharp contrast to Deutsche Bank as a whole; it reported pre-tax
group income of €18 million, a figure including €1.2 billion of
litigation-related charges. Core bank pre-tax income was €1.2 billion. Net
income slumped from €1.127 billion a year ago; the cost-income ratio of the
entire business rose to 93 per cent in the quarter, a rise from 81 per cent a
year ago.

Among further details of the wealth and asset management
business, Deutsche Bank said net revenues from advisory/brokerage services fell
by €16 million, or 8 per cent, suffering from lower client activity in the
current quarter. Net revenues from credit products decreased by €10 million, or
9 per cent, which was more than offset by an increase in revenues from deposits
and payment services of €16 million, or 32 per cent compared to the same period

“In the third quarter we met several challenges. We took
substantial litigation charges and saw reduced profits in investment banking,
leading to a lower quarterly result. Notwithstanding this, we made progress in
key areas. In this quarter alone, we achieved approximately 15 per cent of our
2015 balance sheet reduction target of €250 billion,” said Jürgen Fitschen and Anshu
Jain, co-chairmen of the management board.

“Our Operational Excellence Program remained on track in
delivering cost savings and we sustained investments in our control functions.
In addition, Deutsche Asset & Wealth Management produced one of its
strongest ever quarters,” they said.

Within the private and business clients segment, Deutsche
Bank reported pre-tax income of €347 million, reflecting what it says is a
seasonal slowdown and the non-recurrence of several non operating items.

Register for WealthBriefing today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes