Deutsche Bank CEOs
 Co-chief executives of Deutsche Bank Jürgen Fitschen (L) and Anshu Jain. Reuters

Deutsche Bank failed to meet analyst expectations by posting a drop in net income quarter profits following a spate of costly lawsuits and higher tax payments.

Germany's largest lender posted a 29% fall in net income to €237m (£187.6m, $318.5m), compared with €334m a year earlier, as tax payments increased to €679m in the quarter.

Analysts tipped Deutsche Bank's net income to be around €470m.

Deutsche Bank stumped up €3bn in legal costs in 2013 but it is set to face further charges in litigation fees, and possibly fines and settlements, as it seeks to resolve Libor fixing, currency rigging and mortgage backed mis-selling claims.

Deutsche Bank also warned the markets of its exposure to Ukraine an the Middle East, which have been hit by geopolitical issues.

"Our environment is complex," said Jürgen Fitschen and Anshu Jain, Co-Chief Executive Officers at Deutsche Bank.

"The world's economies are growing at different speeds, and this may cause differences in the pace at which interest rates normalise, creating opportunities; however, emerging geopolitical events in Ukraine and the Middle East may impact financial markets and our clients, and we continue to adapt to a fast changing regulatory framework.

"We remain committed to working systematically through our strategic agenda and, with enhanced capital strength, we face these challenges with greater confidence."