Deutsche Bank Shares Plunge 6.0% on News of Capital Hike
Shares in Germany's biggest lender Deutsche Bank fell as much as 6.0 percent as the Frankfurt market opened Monday, hours after the bank announced it would raise cash by issuing new shares.
The bank's shares were down 4.89 percent to trade at 18.20 euros ($19.36) just before 0830 GMT, making Deutsche the worst performer in the Dax index of leading German companies, which was down 0.73 percent.
Sunday's announcement that the banking giant would raise new capital is a turnaround for CEO John Cryan, who until recently insisted no such move was needed.
Deutsche reported a net loss of 1.4 billion euros for 2016, after it agreed with US authorities around $7 billion in fines and compensation over its role in the sub-prime mortgage crisis.
Shares in the bank plunged at several points throughout last year, including when news of the DoJ's demand became public in September and when several hedge funds later withdrew investments.
Sapped by some 8,000 legal cases worldwide as well as stricter regulation in Europe and historic low interest rates, Cryan has sought to convince investors and observers of the bank's strength since his installation in 2015.
He had already set in motion a far-reaching restructuring including around 9,000 job cuts in home market Germany.
But the plans announced on Sunday go further, reorganising the bank around three pillars of retail and commercial banking, asset management, and corporate and investment banking.
Deutsche plans to focus more closely on Germany by retaining retail banking subsidiary Postbank and integrating it into its business -- giving it a 20 million strong customer base in one of Europe's most stable economies.
Source: Agence France Presse
| Copyright © 2012 Naharnet.com. All Rights Reserved. | https://naharnet.com/stories/en/226496 |