The net income of Deutsche Bank rose by 67 percent year-on-year to 201 million euros (224 million U.S. dollars) in the first quarter (Q1) of fiscal year 2019, Germany’s largest bank announced on Friday.
However, the bank’s revenues fell by 9 percent to 6.4 billion euros in Q1, making 2018 the ninth consecutive year of decreasing revenues.
In Q1 2019, the bank’s corporate and investment sector saw a decline in revenues of 517 million euros or 13 percent compared to the same period last year.
“Our first quarter results demonstrate the strength of our franchise and our continued progress in executing our plans in a very challenging market environment,” said Chief Executive Officer (CEO) Christian Sewing.
Deutsche Bank’s loan volume grew by 10 billion euros in Q1, of which 5 billion euros were attributable to the bank’s corporate and investment business, while 3 billion went to private and corporate banking.
In addition, Deutsche Bank had reduced its non-interest expenses by 8 percent to 5.9 billion euros in Q1, which “substantially offset a challenging revenue environment,” according to the bank.
“Our continued cost discipline helped us to offset lower revenues and we are well on track to meet our 2019 cost target of 21.8 billion euros,” Sewing said.
Prior to the publication of the quarterly figures, Deutsche Bank and Germany’s other largest lender Commerzbank terminated their six week-long talks about a possible merger on Thursday.
Martin Zielke, CEO of Commerzbank, and Sewing had agreed unanimously that such a “transaction would not have created sufficient benefits to offset the additional execution risks, restructuring costs and capital requirements associated with such a large-scale integration.”
“Such cooperations only make sense if they pay off in business terms and move towards a resilient business model,” commented German Finance Minister Olaf Scholz on the termination of the talks between the two banks on Thursday.
Scholz, who was one of the supporters of a merger between Deutsche Bank and Commerzbank, said that the “globally active German industry” would need competitive financial institutions “that could accompany it all over the world.” (1 euro = 1.12 U.S. dollars)