The German Bank is in a deep crisis, their investors are alarmed. The stock has lost 40 percent since the beginning. Now trying to calm German Finance Minister Schäuble. How bad it really is to the industry leader
The German bank shares has known for days only one direction – down. Nearly 40 percent of its value lost in the stock market since the beginning of the Bank. Even the financial crisis low of early 2009, the stock has since broken and listed on the lowest level since the early 1990s. With unusual steps the board is trying to calm the situation.
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What's at Deutsche Bank only going on?
The largest German money house currently struggling with many problems. The Since July reigning CEO John Cryan has taken a hard tag. This led last year mainly because of new provisions for numerous legal risks and high depreciation to a record loss of 6.8 billion euros.
Cryan expressed last hope that this is the worst over. But now even more violent headwind is added by new turbulence in the capital markets. The decline in oil prices, concerns about the Chinese economy and continuing problems of the euro zone put particular the importance for the bank investment banking.
Finance Minister Wolfgang Schaeuble tried on Tuesday to reassure investors and explained with a view to of Deutsche Bank: "I'm not worried."
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How responsive the stock market?
investors are unsettled. The German bank has been weakest value in Dax this year. Credit default swaps, which insure investors against losses at Deutsche Bank, reached the highest level for over four years. In recent days, the prices of these so-called credit default swaps.
doubled Is the concern justified?
No, stresses the German bank. The Institute was given its financial strength and its risk position "absolutely rock solid" Cryan wrote to employees. This was the bank underlined with its announcement on Monday evening that she could pay the promised interest on special loans. Actually, this is a matter of course, just for a bank whose most important asset in the market is confidence.
Is the new boss with investors already flunked?
Cryan was greeted with premature praise when he Anshu Jain replaced at the head of the bank in the summer, 2015. The Briton is considered hard renovators. On the stock market, the first came good. But it is not much left. Even compared to other banks, the performance of the Deutsche Bank is a disappointment. The German bank attributed this last especially that it has canceled its dividend for two years. However, there are considerable doubts about the rate of the bank. Analysts repeatedly ask, as the institution in future still want to earn money.
If the German bank in danger?
Although the German manufacturer has recently lost even if the rating agencies to back cover. However, the bank has much thicker capital buffers than before the financial crisis. In addition, the cheap money from central banks provides enough money for permanent funding.
would also be possible that the bank is bought by a competitor. On the stock market it currently does not cost 19 billion euros. By comparison, the US market leader JPMorgan is ten times as much. However, many contaminated sites like the legal risks should the German bank safe from a takeover. In addition, regulatory authorities may require more and more equity from major banks and a takeover would have therefore hardly worthwhile.
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but all is well?
Cryan asks for patience. "We should not try to manage the share price, we should try to manage the bank," he said in late January. First, it was necessary to work through the backlog quickly.
"A small group of our executives will be under my leadership to address this issue," Cryan stressed now in a message to the workforce. "All other employees are requested to further focus on our customers and the implementation of our strategy." It is the vision of the Board, "to be a German bank which you are familiar and successful" - the way there is long and rocky
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