Deutsche Bank has made "positive early progress" in its massive multi-year restructuring program, according to S&P Global Ratings.

In a note published Monday, the independent credit ratings agency retained a "stable" outlook for the embattled German lender, affirming its long and short-term issuer credit ratings at 'BBB+/A-2'.

S&P said the promising signs were "most evident in the refocusing of the investment bank and the runoff of exposures in the capital release unit (CRU)."

Deutsche Bank announced in July that it would pull out of its global equities sales and trading operations, scale back the investment banking division, and slash 18,000 jobs in a bid to bring profitability in line with cost of capital.

Management wants the changes to trim 20% of the 2019 adjusted cost base by as soon as 2022.

Deutsche Bank chief executive Christian Sewing struck an optimistic tone at the bank's investor conference last week, anticipating a marked rise in profitability and improved cost efficiency through to 2022. He said this was based on measures across private, corporate and investment banking.

Despite the German banking system facing substantial economic and industry risks, S&P has agreed that it saw "sufficient progress" from Deutsche Bank to affirm its credit rating.

"Looking ahead, with substantial operational execution due in 2020 across all divisions, we see this as a critical period that will determine whether, amid an adverse environment, the plan can ultimately be successful," the S&P analyst note said.

"We continue to see management's desired result as ultimately more supportive of Deutsche Bank's creditworthiness: a leading, less-leveraged and well-controlled European bank, with focused global reach, that covers its cost of capital, aided by a greater weight of stable revenues, significant contributions from all divisions, and scalable infrastructure," it added.

Shares of Deutsche Bank are lower by around three-quarters of one percent on Tuesday on a down day for wider markets. Since the appointment of Sewing in April 2018, the stock has lost almost 40% in value.

S&P analysts highlighted that the restructuring of the investment bank and establishment of the CRU appears to be "substantially complete" while Deutsche's regulatory capital is likely to finish 2019 ahead of expectations.

"Step by step, regulators appear to accept that the bank's control environment is improving, signaled for example in the European Central Bank's announcement that it will reduce the bank's 2020 capital requirements by 25 basis points to 11.6%," S&P said.

Wall Street analysts have expressed skepticism over the planned scale of the downsizing and reinvestment, and S&P acknowledged that there are "clear downside risks" at this early stage of the restructure.

"These stem principally from the already weak economic and market environment, which could deteriorate further, making Deutsche Bank's already difficult task of covering the cost of capital even harder," the note said.

"While the current management team has demonstrated its ability to cut costs, execution could yet be impeded or delayed, and an even weaker environment could further undermine revenues."

In the event of material setbacks to the possibility of Deutsche hitting its profitability target by 2022, S&P suggested that it could lower its long-term issuer credit rating for the bank.

"This could be more likely in the event of management missteps or a more costly, or longer, turnaround than anticipated, but it would most likely result from an even more adverse environment that severely weighs on group revenue," it added.

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S&P Global Ratings sees 'positive early progress' in Deutsche Bank restructure - CNBC