Deutsche Bank shares plunge after no deal reached with the U.S. Department of Justice


Deutsche Bank (DBKGn.DE) shares fell more than 3% early Monday after Chief Executive John Cryan failed to secure a speedy deal with the U.S. Department of Justice (DoJ) at the weekend over the misselling of mortgage-backed securities.

Cryan was attending the International Monetary Fund and World Bank’s autumn meetings in Washington, hoping that he might personally negotiate down the $14 billion fine the DoJ has demanded.

Later, Deutsche Bank shares had pared losses but were still at the bottom of a flat German blue-chip index .GDAXI, down 3% at 11.74 euros.

Terry Torrison, managing director at Monaco-based McLaren Securities, commented:

They had a bit of a bounce up last week, but I would still steer clear of Deutsche Bank. They were never going to sort out the U.S. issues that quickly, and whatever happens, I still think they will need to have a rights issue.”

Struggling to restore market confidence, Deutsche Bank is expected to issue new shares, sell assets, or both, once it knows the scale of the fine, to ensure that its capital ratio remains within regulatory limits.

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Deutsche Bank shares plunge after no deal reached with the U.S. Department of Justice

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