Deutsche Bank (DBK.DE) quadrupled its full-year profit in 2021 to €2.5bn (£2.1bn/$2.79bn), its highest profit in 10 years.
The better-than-expected result at the German bank was driven by its investment arm which generated almost two-fifths of the group’s revenue for the full year.
Full-year net profit rose fourfold from the year before to €2.5bn, the highest since 2011. Revenues increased 6% to €25.4bn.
For the fourth quarter, the German lender posted €315m in profits despite higher remaining restructuring expenses including employee severance. Analysts had forecast a profit of €26m.
“In 2021, we increased our net profit fourfold and delivered our best result in 10 years while putting almost all of our expected transformation costs behind us,” CEO Christian Sewing said in a press conference.
Deutsche Bank launched a major overhaul in 2019 which involved shedding 18,000 jobs until 2022 to reduce the number of employees globally to 74,000.
"You all know how turbulent the years between 2016 and 2018 were for our bank. Back then, we seemed to have entered a downward spiral," Sewing said.
"The downward spiral turned into an upward spiral.”
Sewing added the bank has already recognised most of the expenses related to its overhaul, which include severance to workers who left. The number of bank employees has dropped by about 8,000.
The bumper profits have paved the way for Deutsche Bank to resume dividend payments, worth €400m this year. It is the first time since 2019 that the bank will give shareholders a payout.
“We are delighted to be resuming capital distributions to our shareholders as we promised in the summer of 2019,” Sewing said. The bank will buy back €300m of shares.
The bank's share price is up more than 30% over the past year and jumped almost 6% on the back of the results announced.
The results come after years of underperformance and scandals.
The German finance regulator has fined Deutsche Bank for weak controls and the US markets regulator slapped a £120m penalty “for significant compliance failures” in the bank’s dealings with accused child sex trafficker Jeffrey Epstein, as well as with two client banks.
“Our relationship with all regulators has improved significantly over the last two years. We know exactly where we still got some work to do (…) improving the weak spots that we have, for instance, anti-money laundering,” Sewing told reporters.
Deutsche’s corporate banking activities saw its pre-tax profit rise to €1bn, up 86%, while its private bank followed up last years pre-tax loss with a €366m profit.
At the same time, Deutsche Bank’s asset management division saw its taxable profits rise 50% to €816m.
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