Deutsche gets boost from assets

Incoming CEO Ackermann is expected to outline a strategic review

FRANKFURT, Germany (CNN) -- Deutsche Bank has posted a 56 percent increase in profit after a one billion euro gain from the sale of assets.

Europe's biggest bank by assets said on Monday net income rose to 567 million euros ($537 million) in the first three months to March 31, from 382 million euros a year ago. Earnings per share rose to 94 cents from 86 cents, said the company.

Deutsche Bank (FDBK), which has announced plans to cut 9,000 jobs from its 94,800-strong workforce, is under pressure from shareholders to intensify cost-cutting measures as it battles for a place among the top global investment banks.

The bank is Europe's least productive with low profits and a high cost base in Germany. Its stock, which has lost about 20 percent of its value over the last 12 months, slipped 1 percent to 71.13 euros in early Frankfurt trading on Monday.

Incoming chief executive Josef Ackermann, who joined the bank from Switzerland's Credit Suisse Group, is expected to outline the outcome of a strategic review as early as this Monday, analysts have said.

According to Reuters, Ackermann may scale back lending to middle-sized German companies and cut costs by 2 billion euros annually. Over the first quarter, the company sold assets worth about 1.1 billion euros in reinsurer Munich Re and insurer Allianz.

The company is also selling assets in German publicly-traded companies to boost its stocks price and give it more negotiation power in any merger. Deutsche Bank is seen as vulnerable to a takeover due to its low valuation.

Deutsche Bank also said it set aside 270 million euros to cover bad loans to companies, including bankrupt German builder Philipp Holzmann. Analysts polled by Reuters had expected provisions for loan losses of about 317 million euros.

In a sign the bank was working to cut its cost, Deutsche Bank said operating expenses fell by 13.5 percent, or 1 billion euros, to 6 billion euros. But sales fell 7 percent to 7.28 billion euros.