German financial giant Deutsche Bank reported very strong results Wednesday despite taking a $3.1 billion hit to cover losses connected with the credit crisis. Despite the harsh market, Deutsche Bank still expects net third-quarter profit to exceed 1.4 billion euros, chairman Josef Ackermann said, which is more than a year before.

"Despite a challenging quarter for our investment banking franchise, our 'stable' businesses continue to perform well," Chief Executive Josef Ackermann said in a company statement. "We see substantial opportunities in investment banking after this period of correction. Therefore, we stay the course and remain committed to our publicly- stated financial targets for 2008, including pretax profits of EUR8.4 billion, assuming normally functioning markets," Ackermann added in the statement.

Deutsche Bank also announced it will keep its total liquid capital somewhere between 8 and 9 percent of its total assets. The full-year pre-tax profit target will be about the same as announced, Ackermann said.

In May, Deutsche Bank, Germany's biggest bank, reported net profit surging 29 percent to EUR2.121 billion ($2.9 billion). The group's key investment banking business was mainly responsible for Deutsche Bank's record quarterly earnings of EUR2.2 billion, the equivalent of a 10 percent increase over the first three months of 2006, beating analysts' expectation of about EUR1.8 billion.

Just this Monday, another European heavyweight, Switzerland-based UBS AG, announced third-quarter losses of up to SFr800 million ($685 million) and a massive shakeup of its management team. To fully grasp the problems at UBS, one has to remember that they had a profit of 2.2 billion francs in the year-earlier period. "We will make an overall pre-tax loss at Group level for the quarter. These events have led to management changes," UBS chief executive Marcel Rohner said. UBS is the world's largest manager of private wealth assets.

UBS is also to slash around 1,500 investment-banking jobs, the bank said. Its Swiss rival Credit Suisse said that it also was hit by the credit market crisis but managed to stay profitable. In the US, Goldman Sachs alleges that Merrill Lynch could report around $4 billion of mark-to-market losses to reflect lower asset values.

However, UBS says its Global Wealth Management & Business Banking and Global Asset Management businesses continue to record good results. The Swiss Federal Banking Commission said UBS had enough liquidity and a very solid equity base, and creditors and investors should not be concerned. For the year as a whole, UBS is expected to make a substantial pretax profit of somewhere around $8 billion.