(Bloomberg) -- The August spike in volatility and erratic moves across asset classes left no visible scars on Deutsche Bank AG’s trading operation.
Trading profits remained robust in the third quarter, with only three days of net losses, according to the lender’s earnings presentation on Wednesday. That performance came amid a spike in value-at-risk during the middle of the quarter as markets were roiled by concerns about the outlook for the US economy.
Value at risk, or VaR, measures the worst expected loss under normal market conditions over a specific time interval at a given confidence level.
“We think the conditions of the third quarter have carried through without the volatility, incidentally, that we saw in August,” Deutsche Bank Chief Financial Officer James von Moltke said in a Bloomberg TV interview Wednesday.
A bout of volatility hit markets after an unexpectedly weak US jobs report on August 2 fueled worries that the Federal Reserve’s decision to hold interest rates at a two-decade high risked a deeper economic slowdown. The upheaval spilled over into the next week, though markets were quick to recover as macro data improved and the Fed and other central banks started to ease policy.
The better-than-expected performance in Deutsche Bank’s securities unit offset lower revenue in the corporate and private bank. The lender was able to lift income from buying and selling fixed-income securities and currencies by 11%, outperforming peers such as JPMorgan Chase & Co., Goldman Sachs Group Inc. and Citigroup Inc.
--With assistance from Oliver Crook.
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