Deutsche Bank posts biggest annual profit in nearly two decades a day after police search

[FRANKFURT] Deutsche Bank on Thursday (Jan 29) posted its largest annual profit since 2007 after a stronger-than-expected fourth quarter, a day after police searched the bank in an alleged money-laundering probe.

Germany’s largest lender recorded net profit attributable to shareholders of 6.12 billion euros (S$9.3 billion) for 2025, helped by strength at its global investment bank.

That is above 2.7 billion euros a year earlier and slightly ahead of analyst expectations of nearly six billion euros.

The biggest profit since 2007 – and the sixth consecutive year in the black – is a welcome milestone for the bank after a rocky decade that saw big losses and fears among regulators that the bank was teetering.

The 2025 financial year also closes out a three-year financial plan in which Deutsche Bank pledged and met a key profit target – so-called return on tangible equity – of more than 10 per cent.

The bank is now working towards a new 2028 target of 13 per cent that analysts currently think it may miss.

“This gives us the strongest possible foundation for the next phase of our strategy,” said Deutsche Bank CEO Christian Sewing.

Money laundering lapses

The results were overshadowed by prosecutors’ searches this week that highlighted a recurring issue at Deutsche Bank over the last decade – money laundering lapses that have prompted big fines, scrutiny from regulators and police raids.

Frankfurt prosecutors said that they were investigating as-yet unidentified individuals and bank employees. Two people with knowledge of the matter told Reuters the case involved transactions between 2013 and 2018. Deutsche said it was cooperating.

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For the final quarter of the year, net profit was 1.3 billion euros, up from 106 million euros a year earlier. It topped analyst expectations for a profit of around 1.12 billion euros.

The bank also said it had authorised one billion euros in buybacks. For 2026, the bank expects revenues to grow to around 33 billion euros, up from 32.1 billion euros.

Deutsche’s investment bank, which operates from Sydney to New York, remained the biggest revenue generator in the quarter, with 5 per cent increase in revenue, roughly in line with expectations.

Within the investment bank, revenue for fixed-income and currency trading business, one of the bank’s largest, rose 7 per cent and beat expectations for a 4 per cent gain. Revenue for the same business was up 7 per cent at JPMorgan and 12 per cent at Goldman.

Revenue at Deutsche’s other two big divisions was more muted.

Revenue at the retail division was up 3 per cent, slightly short of expectations for a 3.9 per cent rise. The corporate bank saw a 2 per cent fall in revenue, while analysts had forecast a drop of around 1 per cent.

The ratings agency S&P said in a report last week that German bank earnings will continue to improve beyond 2025, in part helped by increased lending on the back of government spending plans for infrastructure and defence. In December, the agency lifted Deutsche’s outlook to positive. REUTERS