FRANKFURT: Deutsche Bans said on Tuesday its net profit in the third quarter was hit by "substantial litigation charges" and weaker investment banking, sending its shares sharply lower on the stock exchange.
Germany's biggest lender said in a statement that its net profit tumbled 94 percent to 41 million euros ($56.5 million) in the period from July to September, way below analysts' expectations.
Group net revenues were down 10 percent to 7.74 billion euros.
"In the third quarter we met several challenges," said co-chief executives Juergen Fitschen and Anshu Jain.
"We took substantial litigation charges and saw reduced profits in investment banking, leading to a lower quarterly result," they said.
Deutsche Bank is currently being investigated over allegations that some of its employees may have been involved in rigging the Libor and Euribor interest rates.
And a number of top managers are also suspected of involvement in a tax evasion scheme in the trading of carbon emissions certificates.
The group said it had set aside 1.2 billion euros in provisions for litigation charges in the third quarter, bringing the overall total in provisions so far to 4.1 billion euros.
"Due to the nature of our business, we are involved in litigation, arbitration and regulatory proceedings in Germany and in a number of jurisdictions outside Germany, especially in the US and UK.
"Such matters are subject to many uncertainties. While we have resolved a number of important legal matters and made progress on others, we expect the litigation environment to continue to be challenging," the bank wrote in its interim report.
The market environment with persistently low interest rates was also challenging, it warned.
Analysts expressed disappointment at the bank's performance and Deutsche Bank shares were among the biggest losers on the Frankfurt stock exchange, shedding 1.73 percent in late morning trade in a slightly firmer market. (AFP)
