Thank you for joining us for our third quarter 2025 results call. As usual, our Chief Executive Officer, Christian Sewing, will speak first, followed by our Chief Financial Officer, James von Moltke. The presentation, as always, is available to download in the Investor Relations section of our website, db.com. Before we get started, let me just remind you that the presentation contains forward-looking statements which may not develop as we currently expect. We therefore ask you to take notice of the precautionary warning at the end of our materials. With that, let me hand over to Christian.
Thank you, Yuana, and good morning from me. As you will have seen, we delivered record profitability in the first nine months of 2025. We are tracking in line with our full-year 2025 goals on all dimensions. Nine-month revenues at EUR 24.4 billion are fully in line with our full-year goal of around EUR 32 billion before FX effects. Adjusted costs at EUR 15.2 billion are consistent with our guidance. Post-tax return on tangible equity is 10.9%, meeting our full-year target of above 10%, and our cost-income ratio at 63% is also consistent with our target of below 65%. Profitability is significantly stronger than in the same period of 2024, even if adjusting for the Postbank litigation provision, which impacted last year's result. Through organic capital generation, our CET1 ratio rose to 14.5% in the quarter.
This reflects our latest share buyback program, which we completed this month, and a significant proportion of next year's distributions. Asset quality remains solid, provisions were in line with expectations, and we had no exposure to recent high-profile cases. In short, we are fully focused on delivering on our 2025 targets. Let me now turn to the operating leverage, which drove our profit growth on slide three. Pre-provision profit was EUR 9 billion in the first nine months of 2025, up nearly 50% year-on-year, or nearly 30% if adjusted for the Postbank litigation impact in both periods. Similarly, adjusted for the Postbank litigation impact, operating leverage was 9%, and profit before tax was up 36%. We saw continued revenue growth of 7%, with momentum across the businesses. Net commission and fee income was up 5% year-on-year, while NII across key banking book segments and other funding was essentially stable.
74% of revenues came from more predictable revenue streams: the corporate bank, private bank, asset management, and the financing business in FIC. Cost discipline remained strong. Non-interest expenses were down 8% year-on-year, with significantly lower non-operating costs, largely due to the non-repeat of Postbank litigation provisions, while adjusted costs were flat. Let me now turn to our progress on the pillars of strategy execution on slide four. We are on track to meet or exceed all our 2025 strategic goals. Compound annual revenue growth since 2021 was 6%, in the middle of our range of between 5.5% and 6.5%. In a changing environment, we are benefiting from a well-diversified earnings mix. Operational efficiency stood at EUR 2.4 billion, either delivered or expected from measures completed. In other words, 95% of our EUR 2.5 billion goal.
Capital efficiencies have already reached EUR 30 billion in RWA reductions, the high end of our target range, and we see scope for further efficiency through year-end. During the quarter, we launched our second share buyback program of 2025, with a value of EUR 250 million, which we completed last week. This takes total share buybacks in 2025 to EUR 1 billion. So together with our 2024 dividend paid in May this year, total capital distributions in 2025 reached EUR 2.3 billion, up around 50% over 2024. This brings cumulative distributions since 2022 to EUR 5.6 billion. Finally, a word on our business on slide five. We are delivering strengths and strategic execution across all four businesses in our Global Hausebank in 2025. All four businesses have delivered double-digit profit growth and double-digit ROTE in the first nine months.
Corporate Bank continues to scale further the Global Housebank model and delivered strong fee growth of 5% in the first nine months while recognized as the best trade finance bank. Our investment bank has been there for clients through challenging times this year and has seen an increase in activity across the whole client spectrum: institutional, corporate, and priority groups. Private Bank has made tremendous progress with its transformation so far this year, with nine month's profits up 71%. Our growth strategy in wealth management is paying off. Assets under management have grown by EUR 40 billion year-to-date, with net inflows of EUR 25 billion, and in asset management, the combination of fee-based expansion with operational efficiency drives sustainable returns of 25%. We are benefiting from our strengths in European ETFs and expanding our offering in that area.
To sum up our performance in 2025 to date, we have delivered record profitability due to continued revenue momentum and cost discipline. Our nine-month performance is in line with our full-year financial goals on all dimensions. We are on track to reach or exceed our strategy execution targets. We have demonstrated strengths across all four of our businesses. Our capital position is strong and supports our aim of distributions to shareholders in excess of EUR 8 billion payable between 2022 and 2026. Before I hand over to James, I want to briefly address our future. We have built very strong foundations for the next phase of our strategic agenda, and with our positioning in the strongest European economy, we stand to benefit from powerful tailwinds coming from German fiscal stimulus, structural reforms, and renewed client confidence.
We look forward to discussing this with you at our investor deep dive in London in November.
Thank you, Christian, and good morning. As you can see on slide seven, we saw continued strong delivery this quarter against all the broader objectives and targets we set ourselves for 2025. Our revenue growth, cost-income ratio, and return on tangible equity are all developing in line with our full-year objectives. Our capital position is strong, and our liquidity metrics are sound. The liquidity coverage ratio finished the quarter at 140%, and the net stable funding ratio was 119%. With that, let me now turn to the third quarter highlights on slide eight. Our diversified and complementary business mix resulted in reported revenue growth of 7% year-on-year, or 10% if adjusted for foreign exchange translation impacts. Due to the non-recurrence of a provision release related to the Postbank takeover litigation matter from which we benefited last year, third-quarter non-operating costs and non-interest expenses were both higher year-on-year.
The tax rate of 26% in the third quarter benefited from the reduction of deferred tax liabilities due to the change in the German corporate tax rate, which will start to decline after 2027. We continue to expect the 2025 full-year tax rate to range between 28% and 29%. In the third quarter, diluted earnings per share was EUR 0.89, and tangible book value per share increased 3% year-on-year to EUR 30.17. Before I go on, a few remarks on corporate and other, with further information in the appendix on slide 36. CNO generated a pre-tax loss of EUR 110 million in the quarter, mainly driven by shareholder expenses and other centrally held items, partially offset by positive revenues in valuation and timing differences. Let me now turn to some of the drivers of these results, starting with net interest income on slide nine.
NII across key banking book segments and other funding was EUR 3.3 billion. Private Bank continued to deliver steady NII growth, supported by the ongoing rollover of our structural hedge portfolio and deposit inflows. Corporate Bank NII was slightly down quarter- on- quarter, reflecting lower one-offs, while it continues to be supported by underlying portfolio growth as well as hedge rollover. With respect to the full year, we continue to benefit from the long-term hedge portfolio rollover, detailed on slide 24 of the appendix, and are on track to meet our plans on a currency-adjusted basis. Turning to slide 10, adjusted costs were EUR 5 billion for the quarter. Cost discipline across the franchise remained strong. Compensation costs were up on a year-on-year basis, primarily reflecting the higher performance-related accruals, higher deferred equity compensation, and the impact of increasing Deutsche Bank and DWS share prices.
With that, let me turn to provision for credit losses on slide 11. Stage three provision for credit losses increased in the quarter to EUR 357 million as provisions for commercial real estate continued to be elevated, while the prior quarter included model-related benefits. Stage one and two provisions reduced to EUR 60 million and were driven by further model updates, which, as in the prior quarter, mainly impacted CRE-related provisions. Wider portfolio performance and asset quality remain resilient. While the macroeconomic and geopolitical environment continues to create uncertainty, we continue to expect lower provisioning levels in the second half of the year relative to the first half year, primarily due to the expected absence of additional notable model effects impacting stage one and two. We are actively monitoring and managing risks from private credit, which, as outlined on slide 28, accounts for about 5% of our loan book.
Our private credit exposure predominantly reflects lender-finance facilities extended to high-quality financial sponsors backed by diversified pools of loans. These facilities are overwhelmingly investment-grade rated internally and are underwritten and maintained with conservative LTVs. We apply conservative underwriting standards, including our assessment of sponsor and investor quality, loan sizes, and structural features. We are comfortable with our portfolio, and as Christian said, we had no exposure to recent high-profile cases. As you might expect, we remain vigilant and have undertaken additional portfolio reviews in light of these events. With that, let me turn to capital on slide 12. Strong third-quarter earnings net of AT1 coupon and dividend deductions led to an increase in the CET1 ratio to 14.5%, up 26 basis points sequentially. RWA were flat during the quarter.
As we head into the fourth quarter, let me remind you of the 27 basis point CET1 benefit we still have from the adoption of the Article 468 CRR transitional rule for unrealized gains and losses, which will expire at the end of the year. Also, following revised EBA guidance from June 2025 regarding the calculation of operational risk RWA under the new standardized approach, we must now perform the annual update of operational risk RWA already by the end of 2025, which is expected to lead to a 19 basis point drawdown in CET1 ratio terms. All else equal, therefore, these two items applied to the third quarter would lead to a pro forma CET1 ratio of approximately 14%, which is also roughly where we currently expect to finish the year.
Our third-quarter leverage ratio was 4.6%, down 11 basis points, principally from higher loans and commitments alongside increased settlement activity at quarter end. Tier 1 capital was essentially flat in the quarter as the derecognition of the $1.25 billion US dollar AT1 instrument that we called in September materially offset the quarter-on-quarter increase in CET1 capital. Let us now turn to performance in our businesses, starting with the corporate bank on slide 14. In the third quarter, corporate bank achieved a strong post-tax return on tangible equity of 16.2% and a cost-income ratio of 63%, maintaining its high profitability. Both metrics showed a year-on-year improvement for the quarter as well as for the first nine months of 2025. As anticipated in the previous quarter, corporate bank revenues remained essentially flat compared to the prior year quarter, demonstrating resilience in a challenging environment.
Margin normalization and FX headwinds were offset by interest hedging, higher average deposits, and 4% growth in net commission and fee income driven by continued expansion in corporate treasury services. On a sequential basis, revenues were slightly lower as the prior quarter benefited from one-off interest hedging gains and seasonally stronger net commission and fee income. Loans and deposits remained essentially flat on a reported basis. Adjusted for foreign exchange movements, loan volumes increased by EUR 5 billion year-on-year, driven by growth in the trade finance business and by EUR 1 billion sequentially. Deposit volumes remained strong, with underlying growth both year-on-year and sequentially offsetting the runoff of concentrated client balances. Non-interest expenses and adjusted costs were essentially flat as effective cost management mitigated the impact of inflation and investments in client service.
A release of provision for credit losses, reflecting a release of stage one and two and a low level of stage three provisions, demonstrates the continued resilience of the loan book. I'll now turn to the investment bank on slide 15. Revenues for the third quarter increased 18% year-on-year, with continued strength in FIC, supported by a material improvement in ONA. FIC revenues increased 19%, driven by strong performance across businesses. Macro products and credit trading demonstrated material year-on-year improvements following strong market activity through the quarter, while financing continued its momentum with revenues again higher than the prior year period, driven by an increased carry profile reflecting targeted balance sheet deployment. Moving to ONA, revenues were significantly higher both year-on-year and sequentially, increasing 27% and 22% respectively.
Debt origination was the biggest driver as both leveraged and investment-grade debt grew revenues year-on-year, with the leveraged finance market particularly active, having recovered well since the second quarter. Equity origination revenues increased 57%, driven by strong issuance activity, including an improved IPO market. Advisory revenues were essentially flat year-on-year as the industry fee pool moved away from our areas of strength. However, pipeline for the Fourth quarter is encouraging. Non-interest expenses were higher year-on-year, primarily driven by the impact of higher deferred compensation and increased litigation charges. Provision for credit losses was EUR 308 million, significantly higher year-on-year, with stage one and two provisions materially impacted by further model updates during the quarter and stage three impairments. Let me now turn to Private Bank on slide 16. The Private Bank continued its disciplined strategy execution and delivered a strong quarterly performance.
Profit before tax doubled, reflecting 13% operating leverage in the quarter. Return on tangible equity rose to 12.6%, showing robust growth both sequentially and year-on-year. Revenues increased, driven by a 9% rise in net interest income from deposits and lending, while net commission and fee income was essentially flat year-on-year. Growth in discretionary portfolio mandates, specifically in Germany, was partially offset by lower net commission and fee income from cards, payments, and postal services this quarter. Growth in personal banking was mainly driven by higher investment and deposit revenues. Lending revenues were up slightly, helped by the absence of an episodic item in the prior year. The continued expansion in wealth management and private banking was supported by solid momentum in discretionary portfolio mandates. Sustained cost efficiency, underpinned by transformation benefits, led to a 9 percentage point improvement in the cost-income ratio to 68%.
Personal banking continued its transformation with 24 additional branch closures in the quarter, bringing the total to 109 this year. These actions contributed to workforce reductions of 1,000 in the first nine months, demonstrating continued strategy execution. Business momentum remained strong, with significant net inflows of EUR 13 billion, supported by successful deposit campaigns. Underlying credit trends showed improvements, with provision for credit losses benefiting from model updates. Turning to slide 17, my usual reminder, the asset management segment includes certain items that are not part of the DWS standalone financials. Profit before tax improved significantly by 42% from the prior year period, driven by higher revenues and resulting in an increase in return on tangible equity of 9 percentage points to 28% for this quarter. Revenues increased by 11% versus the prior year.
Growth in average assets under management, both from markets and net inflows, resulted in higher management fees of EUR 655 million. In addition, performance fees saw a significant increase from the prior year period, primarily due to the recognition of fees from an infrastructure fund. Non-interest expenses and adjusted costs were essentially flat, resulting in a decline in the cost-income ratio to below 60% for the quarter. Quarterly net inflows totaled EUR 12 billion, with EUR 10 billion into passive products, including Xtrackers, which also recorded its best day ever this quarter in terms of net new assets. SQI, advisory services, and cash contributed a further EUR 3 billion of net inflows, which more than offset EUR 2 billion in net outflows for multi-asset and active equity products. Assets under management increased to EUR 1.05 trillion in the quarter, driven by positive market impact and the aforementioned net inflows.
During the quarter, DWS received the necessary licenses to open a new office in Abu Dhabi, strengthening its regional presence and client engagement in the Middle East, reinforcing its position as the preferred gateway to Europe for global investors. For further details, please have a look at DWS's disclosure on their investor relations website. Turning to the outlook on slide 18, we are on track to meet our full year 2025 targets and remain confident in our trajectory to deliver a return on tangible equity of above 10% and a cost-income ratio of below 65%. Our year-to-date performance supports our revenue and expense objectives. Our asset quality remains solid, and despite uncertainty from developments around CRE as well as the macroeconomic environment, we continue to anticipate lower provisioning levels in the second half. Our strong capital position and third-quarter profit growth provide a solid foundation as we head into 2026.
We also completed our second buyback, taking total buybacks in 2025 to EUR 1 billion, and we reiterate our commitment to outperforming our EUR 8 billion distribution target, and we look forward to providing you with an update on our forward-looking strategy and financial trajectory at our next investor deep dive on November 17. With that, let me hand back to Yuana , and we look forward to your questions.