Deutsche Bank announced record pre-tax profits of €2.3 billion for the third quarter of 2024, marking a significant 31% increase compared to the same period last year. This strong financial performance is attributed in part to the bank’s ability to release €440 million from litigation provisions related to settlements from its Postbank takeover case.
Even without the litigation provision release, the bank’s pre-tax profit for the quarter stood at €1.8 billion, a record figure that reflects a 6% increase from Q3 2023. After tax, profits not accounting for the Postbank litigation impact were reported at €1.7 billion, a notable jump of 39% from the previous year.
For the first nine months of 2024, Deutsche Bank recorded a pre-tax profit of €4.7 billion, a 5% decline from the same period in 2023, largely due to the €900 million impact of the Postbank litigation. However, when excluding litigation effects, the bank’s pre-tax profit increased by 13% to €5.6 billion.
CEO Christian Sewing emphasized the bank’s successful navigation of legacy litigation issues while achieving record operational profits. “In these three months, we made important progress in putting legacy litigation matters behind us, while also producing a record third-quarter profit in our operating business,” Sewing stated. He added that Deutsche Bank is well-positioned to assist clients amid current uncertainties and expressed confidence in the bank’s trajectory toward profitable growth and increased capital distributions to shareholders.
In a separate but related matter, the Higher Regional Court of Cologne ordered Deutsche Bank to compensate Postbank investors who alleged they were underpaid during the bank’s 2010 acquisition of Postbank. The court upheld a previous judgment that the investors should have received €57.25 per share, reflecting the stock price in 2008, rather than the €25 they were paid. The claimants are now pursuing a total settlement of €100 million.
Deutsche Bank responded by stating it would analyze the judgment but believes it is essentially fully protected against further financial impact due to existing provisions that cover all outstanding claims, including accrued interest. The bank reported that any additional financial repercussions would likely be limited to approximately €2 million per month in further interest.
Despite the ongoing litigation, Deutsche Bank noted that it has reached settlements with 70% of plaintiffs in the Postbank takeover case, representing 62% of total claims by value. As announced earlier, the bank anticipates a positive effect on its pre-tax earnings from the settlements, which have been reflected in its third-quarter results.
