Deutsche Bank's Resilient Performance Dampened By Higher Credit Provisions — Update

By Elena Vardon

Deutsche Bank reported a rise in its quarterly profit on the steady performance of its investment bank, though a top-up to its credit loss provisions amid heightened economic uncertainty dragged on its shares.

Germany's largest lender posted an after-tax profit of 2.17 billion euros ($2.55 billion) for the first quarter, 8% higher than a year prior and ahead of consensus expectations of 2.005 billion euros. Total revenue edged up 2% to 8.67 billion euros, surpassing the 8.54 billion-euro result penciled in by analysts in a poll compiled by the bank.

Growth at its retail banking arm and at DWS, its separately listed asset-management arm, offset declines at its corporate bank and a subdued result at its investment bank--the firm's primary revenue engine.

Investment-banking profit was softer on a flat top-line, as expected. The division recorded higher activity at its debt and equity origination business and a stable performance in its large fixed-income division--which includes currency and bond trading--due to negative foreign-exchange impacts and a difficult comparison against a record quarter a year ago.

Costs fell 2% to 5.11 billion euros for the quarter due to efficiency gains. However, the bank set aside 519 million euros to cover bad loans, a 10% increase over the first quarter of the previous year. Management described the provisioning as a prudent response to increased macroeconomic uncertainties linked to the Middle East conflict and a specific commercial real-estate exposure within the investment bank.

Shares slid around 2% on Wednesday as investors digested the print.

Concerns around surging energy prices threaten to temper Germany's economic growth expectations--a cornerstone of the bank's latest business plan, which aims to capture tailwinds from the country's multiyear spending spree on infrastructure and defense.

"When it comes to Germany, we want to reiterate that despite lower growth estimates in 2026, our medium-term view is unchanged," Chief Executive Christian Sewing told analysts.

After a period of restructuring aimed at stabilizing operations and moving past legacy scandals, the bank outlined a road map to boost profitability and slash costs through 2028 with a set of new targets.

"This quarter's record profit gives us a great start on the next phase of our strategy," Sewing said, confirming the bank's outlook for the year, which includes a 33 billion-euro revenue target.

Write to Elena Vardon at elena.vardon@wsj.com

(END) Dow Jones Newswires

April 29, 2026 06:46 ET (10:46 GMT)