Deutsche Bank posts 2020 profit on fixed-income boom

Germany's biggest lender swung to a profit attributable to shareholders of €113m in the year to the end of December from a €5.7bn loss a year earlier as net revenue rose 4% to €24bn. The profit was the bank's first since 2014 and beat analysts' forecasts.

Attributable profit in the fourth quarter was €51m compared with a €1.6bn loss a year earlier. Net revenue rose 2% to €5.45bn.

Deutsche's improved performance was the result of a 28% increase in revenue from bond and rates trading in a volatile year for markets prompted by the Covid-19 crisis and political and economic uncertainty.

Chief Executive Christian Sewing is trying to overhaul the bank by stabilising revenue and making it less reliant on investment banking. The investment bank's net revenue rose 32% to €9.3bn in 2020 but income fell at Deutsche's other divisions.

Sewing said: "We’re ahead of our own expectations. We have built firm foundations for sustainable profitability, and are confident that this overall positive trend will continue in 2021, despite these challenging times.”

Deutsche set aside €1.8bn for credit losses, up from €723m a year earlier. The 2020 figure included €251m for the fourth quarter.

Citigroup analyst Andrew Coombs said Deutsche's results were "decent" but that it was unlikely to extend much further with investment banking revenue likely to settle down after the turbulence of 2020.

Deutsche shares fell 1.4% to €8.61 at 10:31 GMT.