Deutsche swings back into profit despite global crisis (Roundup)

Frankfurt - Germany's biggest bank Deutsche Bank AG swung back into profit in the first quarter, the group said Tuesday, after a sharp rise in revenue. The Frankfurt-based bank said net profit came in at 1.2 billion euros (1.56 billion dollars) compared to a loss of 141 million euros in the same period in 2008. But while the results beat analysts' expectations, Deutsche's shares fell by more than 6 per cent to 40.50 euros in early Frankfurt trading partly as a result of the recent strong performance of the company's stock. Pre-tax earnings in the first quarter came to 1.82 billion euros, compared with a loss of 254 million euros a year earlier. Despite the global recession tightening its grip during the first months of the year, Deutsche reported a 57-per-cent jump in quarterly revenue to 7.2 billion euros. 'This was a key quarter for Deutsche Bank,' Deutsche chief Josef Ackermann said releasing the results. 'Once again we demonstrated our strength, as we have consistently throughout this crisis. 'But in this quarter, we also proved our earnings power,' said Ackermann, whose contract with Deutsche was extended by three years to 2013 on Monday. In releasing its results, Deutsche Bank added is name to the growing list of big international banks, which have reported solid first quarter earnings, consequently raising hopes that the worst might now be over for the financial crisis. This includes Bank of America, Credit Suisse and Goldman Sachs. However, Ackermann also warned 'continued caution and vigilance will be essential.' In particular, Deutsche's key investment-banking unit helped to power the group's results helped along by strong bond sales with the division returning to profit in the first quarter after the shakeout in global markets in the final quarter of 2008. This resulted in the division slumping into the red in last three months of 2008. Deutsche said its investment banking operations posted a 1.32 billion-euro pretax profit during the first quarter compared to a pre-tax loss of 5.77 billion euros in the final months of last year. However, as a reminder of the fragile state of the world financial sector, Deutsche Bank also wrote down the value of its assets by one billion euros. Deutsche Bank posted its first annual loss of 3.9 billion euros in more than 5 decades last year as bad debts mounted in the wake of the US mortgage market crisis.