Deutsche Bank expects net profit to rise to more than €1.4 billion in the third quarter despite more than $3 billion in writedowns in the wake of global credit market turmoil, it said today.
Germany's biggest bank said it expected quarterly net profit of above €1.4 billion, although it would take charges of €700 million on its leveraged loan commitments and €1.5 billion on items such as structured credit products and mortgage-backed securities.
It had net profit of €1.25 billion in the third quarter of 2006.
Despite the writedowns, other areas of its corporate banking and securities had strong results, as did Deutsche's less volatile businesses such as retail banking and asset management, it said.
"We stay the course and remain committed to our publicly stated financial targets for 2008, including pretax profits of €8.4 billion euros, assuming normally functioning markets," Chief Executive Josef Ackermann said in a statement.
Pressure on Deutsche Bank to say more about writedowns it was facing mounted this week after Swiss bank UBS announced a shock third-quarter loss and Citigroup said profits were badly hit by the global credit crisis.
Deutsche Bank's credit default swaps tightened one basis point to 36 basis points on the news. Its shares rose 2.5 per cent to €95.85 by 8.40am, outpacing a 1 per cent rise in European banking peers.
