FRANKFURT, Germany (AP) — Germany's Deutsche Bank says net profit more than doubled in the first three months of the year as the bank pressed ahead with cost-cutting and saw more customer money flowing into its asset management business.
Net profit of 575 million euros ($626 million) exceeded 236 million euros from the same quarter a year ago and beat analyst expectations of 487 million euros as compiled by financial information provider FactSet.
CEO John Cryan said Thursday the results showed that the bank was making progress in its difficult, long-term restructuring. The bank has struggled to show strong profits in an environment of low interest rates and more stringent regulation and has been shedding risky assets as well as cutting costs and jobs. It has also had to work through costly legal matters related to past misconduct..
During the first quarter, the Frankfurt-based bank succeeded in cutting costs 5 percent to 6.3 billion euros, and saw 5 billion euros in net new money flowing into its asset management division. The bank cut the number of employees by 3,300 over the year-earlier quarter to 98, 200.
It also closed down its non-core operations unit at the end of last year. The unit, whose purpose was to sell off or wind down risky investments and assets the bank no longer wanted on its balance sheet, had been a steady source of losses. Regulators have pushed banks to strengthen their resilience against losses as a way to prevent another financial crisis.
Deutsche Bank further strengthened its capital buffers by issuing 8 billion euros in new shares, a deal completed April 7.
Litigation costs for the quarter related to past misconduct were only 31 million euros. They have weighed on earnings in past quarters. A settlement with the U.S. Justice Department over sales of shaky mortgage-backed securities alone cost it $7.2 billion.