FRANKFURT: Deutsche Bank posted a loss in the second quarter, it disclosed on Wednesday, its first in four years after setting aside 1.3 billion euros ($1.41 billion) as a provision for a protracted investor lawsuit over its Postbank acquisition.

The loss at Germany's largest lender broke a profit streak after 15 consecutive quarters in the black, in a setback for the bank's turnaround under CEO Christian Sewing.

The bank's net loss attributable to shareholders was 143 million euros in the quarter. That compares with a profit of 763 million euros a year earlier, and was better than analyst expectations for a loss of around 280 million euros.

The bank also increased its forecast for provisions for credit losses for the full year.

Deutsche Bank executives nevertheless said the bank would meet its targets.

The bank is "well on track towards meeting our 2025 goals and our distribution commitments to shareholders", Sewing said.

The bank's quarterly earnings are part of a flurry of reports from Europe's biggest banks, as investors eye whether gains from higher interest rates have run out of steam and if political ructions in France, Britain and the U.S. are weighing on sentiment.

The legal issue at Deutsche centres around the no-frills Postbank, with its millions of clients and roots in the country's postal system, which Deutsche began acquiring during the 2008 global financial crisis.

With the purchase, Deutsche was seeking to broaden its reach in Germany with a steady income stream after years of rapid international expansion.

Instead, Postbank has evolved into a source of consumer complaints, regulatory scrutiny, labour strife and the long-running and costly lawsuits.

The suits, which claim Deutsche underpaid for the Postbank purchase, have been bouncing around courts for years.

Deutsche said in April that it still strongly disputed the claims but that it had decided to post a provision for the cases of 1.3 billion euros. It was a surprise move that took investors off guard and resulted in a 9% drop in shares.

Deutsche's biggest breadwinner in the second quarter was its sprawling investment bank, which has operations spanning from Sydney to New York. Revenues rose 10% from a year earlier, in line with expectations, though below an average 16% rise at big U.S. competitors.

In contrast with the investment bank, revenues at Deutsche's retail and corporate banking divisions fell. ($1 = 0.9222 euros)

 - Reuters