Market crisis tips Deutsche Bank into red

By John O'Donnell

FRANKFURT (Reuters) - Deutsche Bank suffered its first quarterly loss in five years as global financial turmoil heaped more than $4 billion (2.02 billion pounds) in writedowns on the bank and market ructions put a brake on earnings.

The bank said on Tuesday it had slipped to a pretax loss of 254 million euros (199.6 million pounds) in the first three months of the year from a 3 billion profit a year earlier, marking its worst quarter since the collapse of the dot-com bubble.

Deutsche had been seen as one of the winners in the crisis that forced Swiss rival UBS and Royal Bank of Scotland to turn to shareholders to raise cash. Even Europe's top insurer Allianz SE has been affected.

But Deutsche Bank is looking increasingly vulnerable as the global crisis squeezes its most important businesses such as trading in debt products.

Revenue at Deutsche's investment bank tumbled to 880 million euros in the first quarter from 6.1 billion a year ago.

In a conference call with analysts, finance chief Antonio di Iorio retreated from the bank's goal of a pretax profit of 8.4 billion euros this year, saying uncertain markets made a forecast impossible.

"The issue is not the writedowns," said Dieter Ewald, a fund manager with Frankfurt Trust, which owns shares in Deutsche Bank. "What is worrying for me is the impact on the operating business -- that's decisive.

"Deutsche Bank is dependent on the markets. Are they in a strong position here? I would put a question mark over this."