Deutsche Bank (DBK) reported its second quarter earnings on Thursday, beating analysts’ expectations and showing signs of a turnaround for the embattled German bank.
The bank reported net income of 692 million euros ($810 million) for the second quarter, up from 401 million euros in the same period last year. This beat analysts’ expectations of 557 million euros, according to a Reuters poll.
The strong earnings were driven by a 9% increase in revenue, which came in at 6.24 billion euros for the quarter. This was helped by a 28% increase in revenue from its investment banking division, which has been a key focus for the bank as it looks to boost profitability.
Deutsche Bank has been working to turn around its business after years of underperformance and a string of scandals. The bank has been cutting costs, streamlining its operations, and focusing on its core strengths in an effort to improve its financial performance.
CEO Christian Sewing has been leading the bank’s restructuring efforts and has set a target of achieving a return on tangible equity of 8% by 2022. The bank’s performance in the second quarter is a positive sign that these efforts are starting to pay off.
In a statement, Sewing said, “We are making good progress on our transformation journey, and our strong results this quarter demonstrate that our strategy is delivering. We remain focused on growing our core business, containing costs, and reducing complexity, while at the same time investing in our future.”
Despite the positive earnings report, Deutsche Bank still faces challenges ahead. The bank is under pressure from regulators to improve its anti-money laundering controls and compliance processes. It is also facing increased competition from other European banks as well as from fintech startups.
Investors will be watching closely to see if Deutsche Bank can sustain its momentum and continue to deliver strong financial results in the coming quarters. With a new focus on its core business and a commitment to improving profitability, the bank may be on track to finally turn the corner and regain the trust of investors.