Deutsche Bank turns surprise third quarter profit, shares rise

Third quarter profits at Deutsche Bank rose to €278m following a loss of €6.1bn one year ago, driven by strong revenues from trading.

That easily beat the average €610m loss forecast by analysts.

Trading revenues were up by 10% driven by strong performances from fixed income and currencies.

Total revenues grew 2.2% to €7.5bn while its cost-to-income ratio improved from 91% in the second quarter to 87% for the three months to September.

Litigation costs for the three-month stretch also came down, from €1.21bn to €501m.

Frankfurt-based Deutsche Bank´s results came as the lender negotiates with the US Department of Justice to try and reach a settlement over its alleged role in the US sub-prime mortgage crisis.

“We continued to make good progress on restructuring the bank,” Deutsche Bank chief John Cryan said in a statement.

“However, in the past several weeks, these positive developments were overshadowed by the attention around our negotiations concerning the residential mortgage-backed securities matter in the U.S. This had an unsettling effect. The bank is working hard on achieving a resolution of this issue as soon as possible.”

According to Cryan, the lender saw some business reduction following the DoJ´s proposal for a $14bn settlement.

However, since then those reductions had slowed and in some cases reversed, he said.

In a letter sent to staff on Thursday, Cryan reportedly told staff that Deutsche Bank would need to "accelerate and intensify" its restructuring efforts.