News : Deutsche Bank focus on emerging markets as profits rebound

Germany Trade: Deutsche Bank chief executive Josef Ackermann speaks at a press conference in Frankfurt

Deutsche Bank focus on emerging markets as profits rebound

February 05, 2010

Deutsche Bank AG said Thursday, February 4, that it had swung back into profit during the final quarter of last year, with Germany's biggest bank setting out plans to bolster its presence in key emerging economies.

Boosted by a tax benefit, the Frankfurt-based bank said its fourth-quarter net profit jumped to 1.3 billion euro (1.8 billion US-Dollars) as Deutsche emerged from the global economic crisis. This compared with a group net loss of 4.8 billion euro in the same period a year earlier.

"Looking forward we see a clear trend to recovery and stabilisation of financial markets, although the effects of the recent crisis will take time to work through," said chief executive Josef Ackermann. Speaking later at a press conference, Ackermann went on to say Deutsche planned to develop its regional focus on the fast-moving economies of Asia, Central and Eastern Europe as well as the Middle East.

"In our business in Asia, we intend to become one of the top three investment banks," Ackermann said confirming Deutsche's goal to roughly double the bank's revenues in Asia to around 4 billion euro in 2011.

The rise in earnings in the final quarter was the bank's fourth consecutive quarterly profit and resulted in Deutsche posting a full-year net profit of 5 billion euro after it reported a loss of 3.9 billion euro in 2008. This was its first loss since the Second World War and came as the global financial crisis hit the banking sector.

After initially rising following the release of the results, Deutsche's shares were down more than 1 per cent at 45.29 euro in late morning trading in Frankfurt. However, the bank's stock have posted a strong rise over the last 12 months.

The fourth-quarter profit followed a tax benefit of 554 million euro, which arose as a result of a 790-million-euro credit resulting from deferred tax assets in the United States, the bank said. Deutsche's investment banking business reported fourth-quarter pretax profit of 397 million euro, after a record loss in the year-earlier period.

Group fourth-quarter pre-tax profit came in at 756 million euro compared with a loss of 6.2 billion euro in the same period a year ago. Deutsche has proposed raising its 2009 dividend to 0.75 euro a share compared with 0.50 euro in 2008.