The European banking sector may finally be recovered fully from the glogal financial crisis as it’s experiencing rising revenue, profits and capital positions, says a new report from Deutsche Bank AG’s research department.

According to the Deutsche Bank report, profits in the sector are now at their highest level since 2007; revenue is growing across the board; and loan losses are falling. Moreover, the banks’ capital ratios are “substantially above Basel III requirements,” on average, it notes. “The recovery of European banks from seven lean years following the financial crisis finally seems to be in full swing.”

On the profit front, aggregate net income of the 22 largest banking institutions reached almost €50 billion in the first half of the year, the report says, as net interest income, fees and commissions all grew by about 10% year-over-year. However, this improvement was driven partly by the depreciation of the euro, which is down by 19% against the dollar, the report says. In addition, trading income rose by about 33% “on the back of increased market volatility and a very weak prior-year result,” the report notes.

Total revenue jumped by a “staggering 15%” to €257 billion, the report says. At the same time, loan-loss provisions declined by 15% to just €21 billion, which is their lowest level since 2007.

Weaknesses in the large banks’ first half results are hard to spot, the Deutsche Bank report says. For example, although operating expenses grew by 12%, this is a slower pace than the growth in revenue. One black mark is litigation costs, which remain high for several institutions, the report notes.

Regardless, large European banks have become increasingly profitable, the report points out: “Many banks are not yet in a sustainable position again, but they are clearly moving in the right direction.

“Unless there are major hiccups from a renewed European crisis or other potential market turmoil, the seven lean years after the financial crisis may have finally come to an end,” the report concludes. “Along with that comes a gradual re-privatization of banks that were bailed out by taxpayers during the crisis and in which a number of governments still hold substantial stakes.”