Deutsche Bank, Germany’s biggest bank, posted a 16 per cent rise in second quarter profit on Tuesday as its cost-cutting programme bore fruit and income from debt trading rose.

Pre-tax profit rose to €917 million euros ($1.23 billion) in the three months to the end of June, the Frankfurt-based bank said.

“All our core businesses contributed to this result,” co-Chief Executives Anshu Jain and Juergen Fitschen said, releasing the results.

Income from the bank’s key trading debt and foreign exchange business held steady at €1.83 billion despite the current low interest rates instituted by central banks around the world.

However, a drop in group revenue combined with a 49 per cent rise in its tax bill cut into the bank’s second-quarter net profit.

Net profit slumped to €237 million ($318.5 million) compared with €334 million in the same period last year, Deutsche said.

Group revenue dropped 4 per cent to €7.86 billion from €8.2 billion, the bank said.

Deutsche said the costs of legal action it faced were “unpredictable.” As a result, it was raising reserves for future litigation to €2.2 billion from €1.8 billion in the first quarter.

This follows a series of legal moves against the bank, including for its alleged involvement in the Libor benchmark rate scandal.

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