Deutsche Bank sees investment bank revenue in line with peers
INTERNATIONAL - Deutsche Bank AG sees its investment bank performing in line or better than recent guidance given by competitors, after some of the trading momentum from the first half of the year carried over into the third quarter.
“The investment banking revenue environment has continued strong,” Chief Financial Officer James von Moltke said Tuesday at Bank of America’s financials conference. “We’d be, at this point, at least in line with or ahead of what our peers have guided so far.”
Like other investment banks, Deutsche Bank has been profiting from a boom in fixed-income trading on the back of high market volatility and record debt issuance by companies and governments. US lender JPMorgan Chase & Co. last week said trading revenue may jump 20% in the third quarter.
Analysts expect Deutsche Bank’s fixed-income trading revenue to increase by about 5 percent in the third quarter, according to company-compiled estimates.
Von Moltke also spoke about “encouraging signs” in two other core divisions, the retail unit and the transaction bank, though he said they continue to be affected by low and negative interest rates.
The bank is on track to meet its 2020 cost target despite falling behind headcount reduction plans after suspending layoffs for six weeks during the pandemic, von Moltke said. A lower willingness among staff to change jobs in the crisis has also contributed and may force the bank to increase severance payments, he said.