Deutsche Post uncertain as ups bad debt provision

City A.M. Reporter
DEUTSCHE Postbank revealed a return to profit in the second quarter yesterday but warned business may be more subdued for the rest of the year.

Germany’s largest retail bank by clients increased its loan loss provisions to €175m (£144.9m) in the second quarter, citing adjustments made to its exposure to commercial real estate.

Deutsche Postbank made €94m pre-tax profit in the second quarter compared with a €29m loss in the year-earlier period, helped by higher interest income and a smaller hit on subprime-related assets. That compared with analysts’ average forecast of €78m.

Chief executive Stefan Juette said in a statement he expects earnings in the second half of the year to fall short of the first, although they will be positive for the whole of 2010.