Deutsche Bank is in the midst of major economic problems of the day as a result of that the bank has received a claim from the us government of around 14 billion dollars in the wake of the financial crisis in 2008.
the Claim relates to, among other things Deutsche Bank’s activities in the boliglånsbaserte securities, as was the large wagon which got the financial markets to their knees in 2008. Milliardkravet from the united STATES is money the bank hardly will manage to pay, and the bank has stated that they are not going to pay such amount.
the financial markets floods now over of speculation about what will happen with Germany’s kjempebank if the americans make the seriousness of the claim.
Now shall the authorities of the country to be ready to intervene. According to the German newspaper Die Zeit will the government be prepared to take over 25 per cent of the shares in the bank in a “worst case scenario”.
But according to the newspaper hope the bank releases the aid from the state.
This is a turnaround from the chancellor Angela Merkel and the German authorities have stated so far. Merkel stated a few days ago that they weren’t going to come with any rescue package.
Deutsche Bank’s crisis: Therefore, storbanken sued by the united STATES
Sell assets worth billions
the News that the moves of the German government comes just minutes after the bank notifies that the selling away from assets worth billions.
Wednesday, reports the Financial Times that Deutsche Bank has sold away the life insurance company Abbey Life for 1,09 billion euros (10 billion) to the Phoenix Group.
Thus forces the bank to its financial position somewhat, in anticipation of a clarification of the u.s. government.
According to the newspaper rises the stock just over three per cent after the bank announced the sale. The sale will lead to a regnskapstap for Deutsche Bank, but according to the newspaper claims the bank that the sale will strengthen kapitalkraden in the bank by 0.1 percentage points. The bank’s kapitalgrad to be at 10.8 per cent for the time.
More afraid for Deutsche-bankruptcy than brexit
Investeringsøkonom Tom Hauglund in Nordnet wrote in a report Wednesday morning that he is more afraid of the repercussions of any bankruptcy of Deutsche Bank than brexit (british choice whether to leave the EU).
Before the reports that the German government is working with a possible rescue package for the bank, he wrote the following:
Merkel has obviously not learned anything of the financial crisis and is also between the bark and the wood. Italy are not allowed to guarantee for its own bankverden, something that the EU itself has placed restrictions on. Merkel made it even worse at the weekend, then they said they will not support the bank in any form, and stated also that they will not help to motstride a requirement of 14 billion dollars from the u.s. department of justice.
The worst that can happen now is a new banking crisis in Europe. It is brewing in Italy and about the foundations bust in Germany, it could be chaos. This in turn will lead to even stricter capital requirements and the banking sector will end with to be regulated to death, he writes further, and adds that this stands in stark contrast to The european central bank’s approach to do whatever it takes to avoid a new crisis.
Hauglund think the wisest thing Merkel can do is to stand behind the bank, get americans to reduce the claim their and then get to the changes in Deutsche Bank:
– Last, but not least, she had got Deutsche to slowly but surely reduce the derivatposisjonene. Rumor says they have two to four times the USA’s GDP (gross domestic product, journ.anm.) in gross derivateksponering.
Why is the bank sued
In 2007 it happened no one thought could happen: the Us housing market collapsed.
the Fall in house prices and a growing number of mortgage customers have not be able to make up for dropped a giant load of boliglånsbaserte investments in the financial sector. The worst financial crisis since the 30′s was thus a fact.
A major cause of the collapse was utlånspraksisen to the banks. People without sufficient income or capital received mortgages with complicated renteordninger.
The rotten boliglånene was then bundled with other mortgages into financial products that let investors juggle with the risk of loss – so-called credit derivatives.
Such as boliglånene far better than they actually were.
Deutsche Bank was one of the actors that sold such products, and in the last week, it became known that the us government requires the entire 14 billion – about 114 billion – in compensation for the damage from the collapse.
The enormous risks that led to the financial crisis, stands in stark contrast to how Deutsche Bank misrepresented credit derivatives a few years earlier.
“Generally credit derivatives a better distribution of risk in financial systems”, concluded the Deutsche Bank among others in a report from 2004.
In the report, wrote the bank that it is “extremely unlikely” that anyone in the derivatives market will go bankrupt.
As is well known, went giant Lehman Brothers bankruptcy in 2008.
the U.s. government, by børstilsynet the Securities and Exchange Commission (SEC) in the lead, believes Deutsche Bank feilinformerte about the products.
the Products had the top marks in the ratings agencies, and the interest from investors who would earn money on interest rates, was equivalent to big.
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