FRANKFURT am main
A day of madness for the title of Deutsche Bank on the Stock exchange. Tumbled 9% in the morning until you are below the threshold for a symbolic 10 euros, after that Thursday the United States was the news that a dozen large hedge funds had moved their business from the largest German bank in the fear of a crisis, shares are creeping up suddenly in the afternoon when it is circulated, the indiscretion, the collection agency Afp, and not confirmed, according to which it would be near an agreement for $ 5.4 billion on the fine of the Department of Justice Uses for misconduct in the sale of the securities securitized. The initial request of $ 14 billion it had in the past few weeks weakened the title and raised the hypothesis, which was always denied by Deutsche Bank and the German Government, a capital increase and a possible public intervention in support of the bank. At the end of the session in Frankfurt, as the stock closed up 6.4% at 11,57 euro. The New York Stock exchange, the rebound in intra-session arrived at 13 percent.
In the course of the day had descended to a minimum, the subordinated bonds of the bank, the so-called “coco bonds”, while it was increased in the cost of insurance against default through the Cds. The violent swings on the stock Deutsche Bank have dragged the other banks and the european stock Exchanges.
The story of the fine by the Us administration is crucial for a bank last July has been judged to be one of the weakest in Europe in the stress test conducted by the European Banking Authority. The amount initially requested by the american authorities, would go well beyond the reserves set aside by the institute to Frankfurt to meet the different judicial proceedings in which it is still involved and she would be forced to a capital increase. The figure circulated in the afternoon of yesterday is still in the upper part of the fork is considered tolerable by the shareholders of the sector that Deutsche Bank should have to go back to the investors. Beyond the euphoria of the stock exchange in the afternoon of yesterday, the problem is not completely solved, because in addition to the cause for the Rmbs in the U.s., the bank is involved in several investigations and scandals, including one in Russia.
After the collapse of the morning, the chief executive officer, John Cryan had tried to throw water on the fire with a message to employees, in which he said the “solid fundamentals” of the bank, the “distorted perception” on the part of the market, and accused the “speculation”, in addition to unspecified “forces of the market that wants to undermine the confidence in us.” Cryan had also explained that in the first half of this year, Deutsche Bank has made profits of a billion euro, rising to 1.7 billion if you exclude the extraordinary items, like restructuring costs. He also pointed to the abundant liquidity, 215 billion euros, a circumstance also recognized by the analysts of the banking sector to cope with any difficulties. Markets we also note that in case of necessity Deutsche can have access to liquidity from the european central Bank. Finally, he recalled that the policy of privatization is continuing: the other day, was sold the insurance company, the English Abbey Life and should be complete by the end of the year sale of stake in chinese bank Hua Xia, an operation which, moreover, many in the market believe is to proceed with the delay.
In the past few days, Deutsche Bank has had to repeatedly deny it, and had also made the German Government, have requested and you were preparing a rescue the public. The fact remains that, beyond the upsets of yesterday, the markets continue to have the perception of a bank struggling not only with the solution of the scandals, but with the definition of an effective strategy to recover profitability and a capital too close to the minimum limit of the requirements imposed by the supervisory authorities.
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