Deutsche Bank has raised its forecast for bad loans against the backdrop of a weak German economy, as the bank returned to profit in the third quarter, boosted by investment banking and a cut in reserves for Postbank lawsuits.

Germany's largest lender had posted a 143-million-euro loss in the second quarter, at the time announcing it would not embark on a second share buyback program this year and factoring in a provision for its long-running lawsuit over its acquisition of its Postbank division.

Germany’s largest lender reported a better-than-expected rise in its third-quarter profit on growth in its investment-banking division and the partial release of provisions linked to litigation over its Postbank acquisition.