Deutsche Bank, BNP Paribas Earnings Beat Underscore Resilience at European Lenders

Europe’s largest lenders reported stronger-than-expected second-quarter earnings on Thursday, helped by buoyant fixed-income trading and disciplined cost control, offsetting a sluggish deal-making environment and a firmer euro. Deutsche Bank led the roster, posting net income of €1.49 billion versus analyst expectations of €1.26 billion. Revenue rose to €7.80 billion, supported by €2.30 billion from fixed-income and currency trading. Pretax profit reached €2.42 billion, the highest since 2007, and management reiterated that the bank remains on course to meet its 2025 profitability targets. Shares climbed about 5.8% in early Frankfurt trading, while the lender’s CET1 capital ratio stayed broadly unchanged. France’s BNP Paribas also exceeded forecasts, generating €12.58 billion in revenue and €3.26 billion in net income. A 28% jump in rates-trading revenue lifted the FICC division to €1.41 billion, offsetting softer equity-trading results. The bank maintained a CET1 ratio of 12.5% and said it expects a "strong acceleration" in earnings during the second half, targeting full-year net profit of more than €12.2 billion. Spain’s Banco Sabadell reported net income of €486 million, about 11% above consensus, on net interest income of €1.21 billion. The lender affirmed a 16% return-on-tangible-equity ambition for 2027, projected annual profit above €1.6 billion without U.K. unit TSB, and outlined plans to return €6.3 billion to shareholders over the 2025-27 period, starting with a €0.07 interim dividend on 29 August. Among other financial groups, asset manager DWS Group recorded a better-than-expected €306 million in adjusted pretax profit and improved efficiency metrics, though net inflows trailed estimates. The broad-based earnings beats lifted European banking shares, suggesting the sector is weathering slower capital-markets activity and currency headwinds more robustly than investors had anticipated.