Deutsche Bank earnings soar in third quarter

More than a year after the collapse of Lehman Brothers, Deutsche Bank profits soared to €1.4 billion in the third quarter.

Deutsche Bank earnings soar in third quarter
Photo: DPA

According to preliminary estimates released on Wednesday, Deutsche Bank’s net profit was €1.4 billion ($2.1 billion), up from €440 million in the same period a year ago.

Deutsche Bank, Germany’s largest bank, declined German state aid, taken up by number two Commerzbank and a raft of state-owned regional banks in the wake of Lehman Brothers’ bankruptcy, and is now poised to benefit from a recovery in the sector.

Its pre-tax profit climbed to €1.3 billion from just €93 million in the year-earlier period, but its bottom line was also boosted by tax reimbursements following audits of previous years’ results.

That disappointed investors who drove the bank’s share price down sharply in early Frankfurt trading.

Merck Finck analyst Konrad Becker told AFP those reimbursements could amount to as much as €500 million, but said profit taking was probably also behind the fall in Deutsche Bank shares.

The bank is to release full results on October 29, and some figures could change in the meantime, it said.

But the Frankfurt-based lender added that all its business segments posted “positive results,” and that its “tier one” capital ratio, a closely watched measure of its financial soundness, improved to 11.7 percent from 10.3 percent.

Just over a year after the failure of US investment banking giant Lehman Brothers drove the global financial system to the brink of collapse, sector bellwethers like Goldman Sachs and Citigroup also posted strong results last week.

Analysts nonetheless focused on the tax effects from which Deutsche Bank benefitted, with one telling Dow Jones Newswires that such one-off items were frustrating.

The pre-tax result was only slightly better than the €1.2 billion expected, he added.

Deutsche Bank shares fell sharply in morning trading on the Frankfurt stock exchange, losing 3.16 percent to €53.59 while the DAX index of leading shares was essentially unchanged overall.

“That cannot be tied to the figures,” Becker said, estimating that it might be the result of profit taking because the shares had recently been gaining in value.

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Emergency numbers fail in several German states

Callers to the emergency numbers 110 and 112 weren’t able to reach operators Thursday morning in several German states.

The 112 emergency number on an ambulance.
The 112 emergency number on an ambulance. Photo: picture alliance/dpa | Boris Roessler

The emergency number 110 for police and 112 for fire crews failed around the country early Thursday morning, with callers unable to reach emergency operators for urgent assistance between about 4:30 am and 5:40 am local time.

The Office for Civil Protection and Disaster Aid is looking into these outages, which were reported in states including Lower Saxony, Baden-Württemberg, and  Brandenburg, and in major cities like Berlin, Cologne, Hamburg, and Frankfurt. Cologne was further affected by cuts to electricity, drinking water, and regular telephone services. Lower Saxony also saw disruptions to the internal phone networks of police and hospitals.

Emergency services are not reporting any more disturbances and people should be able to once again reach 110 and 112 around the country as normal.

Investigators are looking into the problem, but haven’t yet established a cause or any consequences that may have happened due to the outage. Provider Deutsche Telekom says they have ruled out the possibility of an attack by hackers.