DB - Deutsche Bank: Time To Take Some Profits After A Strong H1 2024 For German Banks (Rating Downgrade)

2024-07-01 10:37:48 ET

Summary

• Deutsche Bank has outperformed the iShares MSCI Europe Financials ETF by 10% in 2024.
• The bank saw 1% Y/Y higher revenue in Q1 2024, a return on tangible equity of 8.7%, and tangible book value of €29.26/share, up 3% Q/Q.
• All segments except the Private Bank saw a return on tangible equity of about 15%.
• Strong underlying performance should continue in Q2 2024, but reported results will be impacted by a legal provision related to the 2010 Postbank acquisition.
• The bank may yet provide further upside if it reaches its 2025 financial goals, which seems more challenging against the backdrop of rate cuts and higher wage demands.

Introduction

Deutsche Bank ( DB ) has outperformed the iShares MSCI Europe Financials ETF ( EUFN ) so far in 2024, with gains in the largest German lender exceeding benchmark returns by some 10% year-to-date:

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