Miracle on Taunusanlage 12: Deutsche Bank Crushes Estimates, Posts Surprise Profit

By God, these numbers look almost too good to be true. The company was supposed to lose hundreds of millions for the quarter, but instead posted a Santa Claus like gift for investors, profiting 256m euros — thanks in large part of fixed income. That’s the current theme with the investment banks — outrageously great trading revenues while everything else sucks windpipe.

Net income was 256 million euros ($279 million) compared with a 6.01 billion-euro loss in the year-earlier period, Deutsche Bank said in a statement from Frankfurt on Thursday. Fourteen analysts surveyed by Bloomberg News forecast a loss of 394 million euros on average. Trading revenue rose 10 percent to 2.6 billion euros, driven by debt and currencies, the lender’s biggest source of income, which beat analysts’ estimates in the quarter.

“We continued to make good progress on restructuring the bank,” Cryan said in the statement. “However, in the past several weeks, these positive developments were overshadowed by the attention around our negotiations concerning the residential mortgage-backed securities matter in the U.S. This had an unsettling effect. The bank is working hard on achieving a resolution of this issue as soon as possible.”

Net revenue rose 2.2 percent to 7.5 billion euros in the third quarter from a year earlier, while risk-weighted assets dropped 5.6 percent in that period. The cost-to-income ratio, a measure of profitability was 87 percent, down from 91 percent at the end of June.

Deutsche Bank said it faced 501 million euros of litigation costs in the third quarter, down from 1.21 billion euros a year earlier. That’s less than the 650 million euros 12 analysts surveyed by Bloomberg News forecast on average. Restructuring costs were 76 million euros in the quarter, below the 279 million euros 10 analysts had anticipated on average.

The lender’s common equity Tier 1 ratio, a key measure of its financial strength, stood at 11.1 percent at the end of September compared with 10.8 percent at the end of June. On average, 13 analysts surveyed by Bloomberg had forecast a ratio of 10.9 percent.

Jesus fucking Christ I am going to get my dick chopped off tomorrow with my short. Lucky for me, it’s only about a 5% position. God willing, he will smite these Nazi collaborators at a later date and bankrupt the big mess without offering safe quarter to any of their C level schemers. But, without question, these look like great numbers and should provide longs with an adequate reason to crush the skeletal frames of short sellers.

Moving on, Barclays also crushed estimates — thanks to trading revenues. You guessed it, fixed income schemes.

Barclays Plc said profit rose 35 percent in the third quarter as revenue from fixed-income trading surged to the highest in more than two years.

Pretax profit climbed to 837 million pounds ($1.02 billion) from 619 million pounds a year earlier, the London-based lender said in a statement Thursday. Excluding one-time items, profit was 1.7 billion pounds, beating the 1.53 billion-pound average estimate of five analysts surveyed by Bloomberg News.

Fixed-income revenue climbed 40 percent from a year earlier to 947 million pounds. The surge echoed the performance of the five major U.S. investment banks, which collectively posted a 49 percent jump in revenue from that business. Bond trading has been spurred by the surprise U.K. referendum to leave the European Union, divergent views on the direction of central-bank rates, and changes in money-market regulations.

All that being said, U.S. investment banks, in spite of their grandiose fixed income gains, haven’t gone anywhere in share price since their earnings. It has been one giant rigged market, with assholes taking all of the money for themselves — leaving us little folk with barely a few millions to live out our pedestrian existence.