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Deutsche Bank continues to be profitable in Q2 but issues an economic alert

Previously, it was seen that Drew Goldman, head of global corporate finance coverage and advice at Deutsche Bank, will retire and be succeeded by regional leaders, according to a message that was sent on Monday.

A quick recap shows that according to the message issued by Mark Fedorcik, the co-leader of the investment banking division, Goldman, who has held several leadership positions throughout his 22-year experience with the German lender, wishes to investigate options outside of investment banking.

As shown in an announcement from the Dubai Financial Services representative, Goldman will start working for Abu Dhabi’s sovereign investment fund on October 3 as the global director of real estate investments.

Bruce Evans, international co-head of mergers and acquisitions (M&A), will now be in charge of Deutsche Bank’s Americas investment banking services and advising. Evans, who has worked for Deutsche for 15 years, was promoted to co-head of M&A in 2021.

Investment banking protection and advice in Europe are run by Berthold Fuerst & Henrik Johnsson, while Mayooran Elalingam oversees the franchise in Asia.

A spokesman for Deutsche Bank confirmed the memo’s contents.

So after these developments, the latest unveiling in this department turns many heads. As investment banking profits increased, Deutsche Bank (DBKGn.DE) reported a better-than-anticipated 51 percent increase in second-quarter earnings on Wednesday. However, the lender was less upbeat regarding the division’s outlook for the whole year and issued a warning about the economic outlook.

The report comes amid seven days of earnings announcements from big bankers in Europe. Investors are keeping an eye out for any indications that their activities and viewpoints are being negatively impacted by the conflict in Ukraine, rising interest rates, and a poorer overall economy.

Germany’s banks are in the heart of a diplomatic maelstrom because the economy of the nation is strongly reliant on Russian energy and any supply disruptions will have a significant impact.

A net profit of 1.046 billion euros ($1.06 billion) was attributed to shareholders. This is higher than analysts’ predictions of a profit of about 788 million euros and compares to a gain of 692 million euros from the previous period.

After years of losses, this quarter marked the eighth in a row that a profit was recorded.

For Germany’s biggest insurer and Chief Executive, the media-famous Christian Sewing, this year is essential as he works to meet the goals he set in a pricey revamp of the bank that began in 2019.

Despite sounding pessimistic over the near-term financial picture, Sewing stated in a note to the workforce that they must be pleased about the results.

The coming months will be difficult as always. He argued that there are grounds to think that things will get considerably tougher economically.

Due to inflation, bank surcharges, and other costs associated with the war in Ukraine, the bank reduced its cost target and no longer aimed for an expenditure ratio of 70% for this year. It now anticipates the ratio to go as great as the mid-seventies.

The bank maintained its overall revenue forecast but reduced its forecast for the financial institution downward, anticipating revenues to be largely flat this year as opposed to the previously anticipated modest increase.

Amid the uncertainty brought on by the war, Deutsche, like its American rivals, was affected by a fall in dealmaking, but trading held up due to erratic markets.

Earnings from the investing bank’s sourcing and consulting division fell by 63 percent in the quarter, despite an increase in overall corporate finance revenues of 11%.

One of the bank’s main departments, fixed-income, and currency operations, had a 32% increase in revenue.

The increase in interest rates contributed to the corporate bank’s 26 percent increase in revenues.

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