Deutsche Bank traders drive record profits as IB struggles

Deutsche Bank traders have helped drive the German lender to record annual and quarterly profits.

Revenues within the bank’s fixed income and currency division grew 6 per cent to €2bn, its strongest fourth quarter on record.

However, this contrasts with a 9 per cent decline in year-on-year advisory revenue for the same quarter, previously flagged as key unit of growth.

Advisory fees, which were €199mn in the fourth quarter of 2024, fell to €181mn in the same period for 2025.

In November Fabrizio Campelli, head of the corporate and investment bank at Deutsche, said he wanted to hire 60 senior bankers across its advisory and equity capital markets operations, part of a strategy to increase its share of the global investment bank fee pool.

There was no update on these hiring plans in prepared remarks today but chief executive Christian Sewing said he remains committed to “repositioning” the investment bank so it can expand advisory and ECM capabilities.

This will be done alongside “maintaining the strength” of the debt franchise, the CEO said.

The company’s investment bank has two divisions: its origination and advisory arm — recently renamed investment banking and capital markets — and its fixed income and currencies franchise.

Investment banking and capital markets revenues for 2025 were €1.9bn, down 6 per cent, or what Deutsche Bank called “flat” if adjusted for certain mark-to-market losses on leveraged debt capital markets exposures.

During a press conference Raja Akram, chief financial officer designate, said that leveraged capital markets were the “weakest area” of investment bank performance.

But he added that this year that segment of the market will develop in a way that is “good for Deutsche Bank”.

He also said that the selective hiring of ECM and advisory bankers in four target areas would help it compete against the largest Wall Street banks.

These sectors are industrials and infrastructure, financial services, healthcare, and technology.

“It is clear US banks had a fantastic year [in 2025] but we believe our position in Europe is strong and we will maintain market share on the continent alongside trying to gain market share in the US,” he said.

He insisted that Deutsche Bank would compete where it has a “natural advantage”.

“We can be a champion in our own right without worrying too much about what the US banks are doing,” Akram said.

Akram is due to takeover from outgoing CFO James von Moltke in March.

The bank says it has also received regulatory approval for an additional €1bn share buyback and proposed a dividend of €1 per share.

Sewing noted the bank’s post-tax return on tangible equity for the full year was 10.3 per cent, exceeding its target of 10 per cent. “We see this as a great start towards our commitment of greater than 13 per cent by 2028,” he said.

During a press conference Sewing also said the bank is using AI to make the trade finance book in the corporate bank more efficient, adding that there were no plans to reduce headcount at the bank as a result of using the technology.

Deutsche Bank is targeting a 50 per cent revenue contribution within the investment banking and capital markets segment in 2028 from ECM and advisory while maintaining strong growth in the traditionally strong debt origination business.

The bank’s ECM markets origination saw a 21 per cent year-on-year increase in revenue to €225mn.

“This highlights that this strategic area within the investment bank seems to be picking up more in line with ambitions to grow its overall earnings footprint,” said Julian Zimmerman, a bank and sovereign analyst at Scope Ratings.