Deutsche Bank posts exceptional loss of 1.2 bn euros
The biggest German bank, Deutsche Bank, unveiled Wednesday a third quarter net loss of 1.2 billion euros (1.66 billion dollars) owing to a one-off charge linked to its purchase of another financial institution, Postbank.
Analysts polled by Dow Jones Newswires had forecast a net loss of 1.47 billion euros.
Deutsche Bank warned on September 21 that it would incur a charge of 2.3 billion euros as part of its reevaluation of the holding in Postbank, which has Germany's largest retail banking network.
The new calculation was required because Deutsche Bank has made an offer for all of the shares in Postbank as part of an increase from nearly 30 percent to more than 50 percent by the end of this year.
Excluding the Postbank charge, Deutsche Bank said it made a net profit of 1.1 billion euros in the three-month period, down by about 21 percent from its profit of 1.4 billion in the third quarter of 2009.
The bank reported revenues of 5.0 billion euros including the charge.
Chairman Josef Ackerman said: "The third quarter results again prove the robustness of our recalibrated business model despite the difficult ongoing macro-economic and market conditions."
Deutsche Bank is taking over Postbank to add a strong retail banking pole to its traditional investment bank activities.
Early this month Deutsche Bank said it had raised 10.2 billion euros, its biggest capital increase ever, to finance the Postbank takeover and build up its shareholder capital base in view of proposals from international banking regulators in response to the global financial crisis.
"We have successfully executed the largest capital increase in the history of Deutsche Bank, which strengthens our capital base mainly to accommodate the planned acquisition of Postbank," Ackermann said.
"Our retail banking operation is vastly increasing its footprint in Germany, which will balance our earnings towards an even more stable business," he added.
Deutsche Bank did not provide an outlook for the full year, but is targetting a pre-tax profit of 10 billion euros in 2011.