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Deutsche Bank chief Cryan tries to reassure on bank's strength | |
(35 minutes later) | |
The chief executive of troubled Deutsche Bank has made efforts to reassure staff in an email saying the bank's finances are strong. | The chief executive of troubled Deutsche Bank has made efforts to reassure staff in an email saying the bank's finances are strong. |
John Cryan told them the bank had become the object of "hefty speculation" and that "new rumours" were causing the share price to fall. | John Cryan told them the bank had become the object of "hefty speculation" and that "new rumours" were causing the share price to fall. |
The bank's shares hit new lows in European trading as confidence in the bank continued to falter. | The bank's shares hit new lows in European trading as confidence in the bank continued to falter. |
The fall followed reports that some hedge funds had withdrawn funds. | The fall followed reports that some hedge funds had withdrawn funds. |
The shares extended losses overnight in New York trading, taking the bank's share price below €10 (£8.60) for the first time ever. | The shares extended losses overnight in New York trading, taking the bank's share price below €10 (£8.60) for the first time ever. |
Mr Cryer said that at no point in the last 20 years had Deutsche Bank been as strong as it is now. | Mr Cryer said that at no point in the last 20 years had Deutsche Bank been as strong as it is now. |
But Deutsche Bank is under the most pressure of any bank since the financial crisis. | But Deutsche Bank is under the most pressure of any bank since the financial crisis. |
Investors are increasingly worried about the financial health of the bank, which faces a $14bn fine in the US for mis-selling mortgage-backed bonds before the financial crisis of 2008. | Investors are increasingly worried about the financial health of the bank, which faces a $14bn fine in the US for mis-selling mortgage-backed bonds before the financial crisis of 2008. |
The bank's shares have been falling steadily from a recent high of €27.80 last November, but at their peak in May 2007, before the start of the banking crisis, they were valued at almost €100. | The bank's shares have been falling steadily from a recent high of €27.80 last November, but at their peak in May 2007, before the start of the banking crisis, they were valued at almost €100. |
Deutsche's woes hit bank shares across Europe, with Barclays and Royal Bank of Scotland falling more than 4% at the start of trading in London. | Deutsche's woes hit bank shares across Europe, with Barclays and Royal Bank of Scotland falling more than 4% at the start of trading in London. |
German rival Commerzbank was down about 5%, while Swiss, French and Italian banks were down by about the same amount. | German rival Commerzbank was down about 5%, while Swiss, French and Italian banks were down by about the same amount. |
Unpopular | Unpopular |
In Italy, Economy Minister Pier Carlo Padoan told La Stampa newspaper that it was in everyone's interest "to look for solutions that must then be carefully handled". | In Italy, Economy Minister Pier Carlo Padoan told La Stampa newspaper that it was in everyone's interest "to look for solutions that must then be carefully handled". |
But the German government's position is not clear. | But the German government's position is not clear. |
Although a newspaper report earlier this week suggested the German government had made some provisional plans to rescue Deutsche, this would be politically unpopular. | Although a newspaper report earlier this week suggested the German government had made some provisional plans to rescue Deutsche, this would be politically unpopular. |
Eckhardt Rehberg, parliamentary budget spokesman for Chancellor Angela Merkel's conservative CDU party, told Reuters: "At the present time, I would rule out any capital help. That would not be the right way to go." | Eckhardt Rehberg, parliamentary budget spokesman for Chancellor Angela Merkel's conservative CDU party, told Reuters: "At the present time, I would rule out any capital help. That would not be the right way to go." |
Deutsche Bank made a net loss of €6.8bn last year and has embarked on a round of hefty cost-cutting that includes shedding 15% of its 100,000-strong global workforce. | Deutsche Bank made a net loss of €6.8bn last year and has embarked on a round of hefty cost-cutting that includes shedding 15% of its 100,000-strong global workforce. |
Like most of the world's leading banks, Deutsche Bank has been embroiled in the major banking scandals of recent years, including rigging interest rates. | Like most of the world's leading banks, Deutsche Bank has been embroiled in the major banking scandals of recent years, including rigging interest rates. |