Deutsche Bank posts record Q4 profit as investment bank drives earnings

Deutsche Bank reported record profits in the fourth quarter of 2025, beating market expectations as strong performance in its investment bank and asset management businesses offset slower corporate activity and lingering regulatory scrutiny.

According to its earnings statement on Thursday, Deutsche Bank posted net profit attributable to shareholders of 1.3 billion euros ($1.56 billion) for the three months to December.

That exceeded the 1.12 billion euros forecast by analysts.

Group revenues for the quarter totaled 7.73 billion euros, broadly in line with the 7.72 billion euros consensus compiled by LSEG.

The lender’s common equity tier 1 (CET1) capital ratio stood at 14.2% at the end of the quarter, down slightly from 14.5% in the third quarter but up from 13.8% a year earlier, underscoring what the bank described as a solid capital position.

Investment bank and asset management lead gains

The results highlighted the importance of Deutsche Bank’s investment bank, which remains its main revenue engine.

Fixed income and currencies trading delivered particularly strong performance, alongside growth at the bank’s asset management arm, DWS, and its private banking division.

Chief financial officer James von Moltke said the quarter capped “fantastic record years” for the fixed income and currencies business and DWS.

He added that growth was also evident in private banking, while acknowledging that 2025 had been a “slightly weaker year” for corporate activity, with investment banking and capital markets more subdued.

Credit impairment charges, a measure of loan losses, came in at 395 million euros, below the 408.3 million euros expected by analysts and down from 417 million euros in the previous quarter.

Noninterest expenses fell 15% year on year, while provisions for credit losses declined 6%, helping lift profitability.

The bank reported a return on average tangible shareholders’ equity of 8.7% for the quarter and 10.3% for the full year, in line with its guidance.

Outlook for 2026 and market conditions

Speaking with CNBC’s “Europe Early Edition,” von Moltke said all four of the bank’s core businesses are “really well positioned, intrinsically and in this environment” to perform in 2026.

He expressed optimism about the outlook for initial public offerings, while cautioning that it was “hard to speculate” on the timing or likelihood of a market correction.

“There are good reasons to believe [markets] might be overstretched; there are good reasons to believe that the market can continue to perform,” he said. “There’s currently a risk on sentiment that’s pervasive in the marketplace… absent some sort of disruptive events, we actually think the markets are quite constructive.”

Von Moltke also said German households could benefit from the country’s fiscal expansion and that Deutsche Bank’s corporate banking division is well placed to benefit from increased investment.

Regulatory probe and shareholder returns

The earnings release followed news that German federal prosecutors had launched a probe into alleged money laundering at the lender, with authorities searching Deutsche Bank offices in Frankfurt and Berlin.

Von Moltke said the bank is cooperating with investigators and noted that the transactions under review date back to 2013 and 2018.

“The idea is that through the potentially late, filed, or delayed filing of suspicious activity reports, there may be a predicate here for money laundering. Let’s see what comes out of it,” he said.

“It’s from transactions that are well in the past. We’ve invested heavily over the years since in our financial crime risk management capabilities. We think those investments have been really good to position the company well and protect ourselves, as well as the marketplace, from potential money laundering.”

Alongside the earnings, Deutsche Bank said it plans to pay a dividend of 1.0 euros per share and has received authorization to buy back up to 1.0 billion euros of its own shares, signaling confidence in its balance sheet and earnings outlook.

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