Deutsche Bank (DBKGn.DE) on Wednesday promised more share buybacks next year and said it may return more capital to shareholders than it had previously envisaged, causing its shares to surge.
The outlook on potential payouts came as Germany’s largest lender posted a better-than-expected 8% drop in third-quarter profit.
Revenue from investment banking slumped but grew in the lender’s retail and corporate divisions on higher interest rates. Deutsche was also slightly more optimistic on its revenue outlook for the full year.
Deutsche Bank shares were up 7% in morning Frankfurt trade as analysts cited positive news on potential buybacks and dividends.
In an unexpected move, Deutsche said it would potentially return more capital to investors than the 8 billion euros it had envisaged through 2025.
James von Moltke, chief financial officer, told journalists there was “upside” to the 8 billion, but “how much remains to be seen”.
Analysts at Mediobanca said the shares “should be rewarded for additional capital return”.
Beyond the payout news, Deutsche’s earnings underscored trends in global banking as investment banks struggle with muted deal activity and trading while higher interest rates boost other divisions.
Deutsche’s net profit attributable to shareholders was 1.031 billion euros, beating the around 937 million expected by analysts.