FRANKFURT – Deutsche Bank (DBKGn.DE) surprised markets on Wednesday by reporting a 7% increase in third-quarter net profit, beating expectations for a decline. The better-than-expected results were powered by strong performance in its investment banking division, particularly in bond trading and debt issuance, underscoring the lender’s ongoing turnaround momentum.

Germany’s largest bank posted a net profit of €1.56 billion ($1.82 billion), up from €1.46 billion a year earlier and well ahead of analyst forecasts of €1.34 billion.

Investment Banking Powers Ahead

Deutsche Bank’s investment banking arm once again proved to be the key profit engine, posting an 18% year-on-year revenue increase, far surpassing expectations for a 10.8% rise.

Revenue from fixed-income and currency trading surged 19%, outperforming U.S. peers such as Goldman Sachs (17%) and nearly matching JPMorgan’s 21% gain. Meanwhile, origination and advisory revenues grew 27%, exceeding analyst projections of 24.4%, reflecting a recovery in deal-making activity after several muted quarters.

The rebound comes amid a wave of renewed global M&A and bond market activity, spurred by rising volatility and adjustments to trade policies under U.S. President Donald Trump’s administration.

CEO Christian Sewing Confident on 2025 Targets

Chief Executive Christian Sewing expressed confidence in the bank’s ability to meet its 2025 financial targets, saying:

“We are on track to deliver on our 2025 financial objectives.”

Sewing, who has led Deutsche Bank’s extensive restructuring since 2018, described 2025 as a “year of reckoning”, when the lender must prove it can sustain profitability and cost discipline after years of heavy losses and strategic missteps.

The bank is also preparing to unveil a new strategic roadmap for 2026 and beyond in November, with Sewing indicating that “nothing is off limits” as the group reassesses its long-term priorities.

Broad-Based Performance Across Divisions

While the investment bank outperformed, other divisions showed mixed revenue growth:

• Retail banking revenue rose 4%, roughly in line with analyst forecasts of 3.4%.
• The corporate banking unit saw a slight 1% revenue decline, compared with expectations of modest growth.
• Asset management arm DWS (DWSG.DE) delivered a standout 34% increase in net profit, driven by strong inflows and improved margins.

Sustained Profitability and Sector Comparison

The third-quarter earnings underscore Deutsche Bank’s nearly uninterrupted return to profitability over the past five years, a stark contrast to the steep losses it endured in the previous decade.

Among major European peers, BNP Paribas reported weaker-than-expected results, while Barclays’ investment banking performance was mixed — highlighting Deutsche Bank’s comparatively strong position in 2025.

Broader Economic Context

The results arrive amid economic headwinds for European banks, including a sluggish eurozone economy, a strong euro, and rising trade tensions tied to new U.S. tariffs. Despite these challenges, global deal-making has picked up, offering a tailwind for investment banks like Deutsche.

Deutsche Bank’s strong performance reinforces its recovery narrative and signals that its multi-year restructuring plan is bearing fruit. Analysts now expect the bank to maintain earnings momentum through 2026 as it refines its strategy and strengthens its capital position.