Deutsche Bank AG (USA) (NYSE: DB) stock lost over 1.9% on 26th, April (As of 11:29 AM GMT-4; Source: Google finance) due to lower than expected first quarter performance and shareholder returns. For the first quarter of 2018, the Revenues lost 5% yoy to €7 billion against the first quarter of 2017. Reported net income reached €120 million hurt by a very high effective tax rate, which reflected tax effects related to share-based payments and nondeductible litigation provisions. Moreover, the bank faced over €130 million of the annual increase from higher bank levies, which was not expected before.
CIB reported IBIT of €205 million, hurt by the weak revenue performance. Excluding the impact of DVA, the impact of FX translation and changes in funding allocations to CIB, revenues lost over 11% yoy against the first quarter of 2017.
Global Transaction Banking and Origination & Advisory businesses (GTB) revenues fell 12% yoy to €918 million hurt by unfavorable FX movements, perimeter adjustments and higher internal funding allocations. But the group expects GTB revenues to improve from the second quarter on a sequential basis, on the back of the benefit from mandates won in the second half of 2017.
Origination & Advisory, revenues fell by 27% to €480 million, broadly in line with the overall Corporate Finance fee pool in euro terms. Debt Origination revenues fell 19% yoy to €316 million due to client demand fall. Despite the declining industry wallet, their investments in this business in prior periods have enabled them to enhance their market share from 2017 levels in both investment grade and leverage debt capital markets.
Equity Origination revenues fell by half to €76 million from pcp due to a loss on the block trade. FIC Sales & Trading, which includes major financing revenues, fell 16% yoy to €1.9 billion due to the impact of FX translation, internal funding allocations and a one-off gain of €84 million related to the valuation of a market infrastructure investment. Equity Sales & Trading Revenues lost 21% year-on-year to €543 million. Private & Commercial Bank divisional IBIT fell 25% or €108 million.