Deutsche Bank AG said on Thursday that profit rose strongly in the fourth quarter and beat expectations after revenue climbed on higher rates, as it completed a wideranging restructuring.
The German lender DB, DBK, said the net profit for the three months to December was 1.80 billion euro $1.98 billion, up from EUR 145 million for the same period in 2021.
The after-tax measure reported EUR 1.98 billion, well ahead of expectations of EUR 1.10 billion, according to a company-provided consensus estimate.
The bank said that the tax benefit from a deferred-tax asset valuation adjustment, a deferred-tax benefit and strong U.S. performance helped the bank's profits.
The Frankfurt-based company said that the quarter was helped by a gain of around EUR 310 million on the sale of Deutsche Bank Financial Advisors in Italy.
The results came after a cost-cutting strategy implemented in 2019 that included job cuts and divestments and curtailing investment-banking operations.
Revenue went up 7% on the year to EUR 6.32 billion, with a 39% growth in net interest income at the corporate banking unit, helped by rate hikes, strong operating performance and favorable foreign-exchange movements, it said.
Revenue was not up to par with expectations of EUR 6.50 billion.
Revenue fell 12% on the year, as merger and equities advisory services slumped, but fixed-income revenue reached its highest quarter for more than a decade, it said.
The bank said that costs were contained, with a 7% reduction in noninterest expenses in 4Q.
Provisions for credit losses went up to EUR 351 million from EUR 254 million in a more challenging market environment.
The lender's full-year target was surpassed by 13.1% and 9.4% in the quarter, as per the post-tax return on tangible equity in the quarter.
Its common equity tier 1 ratio, a measure of financial strength, rose to 13.4% from 13.3% at the end of the third quarter.
It declared a full-year dividend of 30 European cents, up from 20 cents in 2021.
In the years to come, we are well-equipped to deliver sustainable growth and returns to shareholders, Chief Executive Christian Sewing said.