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The First To Defect Wins: Deutsche Bank Planning €9 Billion Capital Raise
Rumors circulating in the market, stoke by a Bloomber report, that the biggest German bank, the one whose assets are about as large as the GDP of its host country, is considering a share sale of up to €9 billion. DB is rumored to have approached banks about arranging a stock sale, although the firm has still not decided to whether to pull the trigger. This development is nothing less than a direct response to Basel III which is expected to require European banks to shore up tens if not hundreds of billions in new equity capital. And as usual the first one loses the least. This only means that all the ugly toxic waste accumulated under the rug in Europe's financial institutions is about to emerge.
More from Bloomberg:
Deutsche Bank AG has approached
investment banks to assess their interest in managing a stock
sale to raise as much as 9 billion euros ($11.4 billion), said
three people with knowledge of the discussions.
Germany’s biggest bank has yet to decide on the sale, said
the people, who declined to be identified because the plans are
confidential. The proceeds may be used to increase the bank’s
stake in Deutsche Postbank AG and to meet rising regulatory
capital requirements, the people said.
Deutsche Bank has the option to increase its almost 30
percent stake in Bonn-based Postbank, which currently has a
market value of 5.6 billion euros. Deutsche Bank Chief Risk
Officer Hugo Banziger said in an investor presentation in June
that the Frankfurt-based bank would only raise capital for
acquisitions.
Deutsche Bank spokesman Ronald Weichert declined to comment
today. Deutsche Postbank AG Chief Executive Officer Stefan Juette, speaking at a banking conference in Frankfurt today,
said he doesn’t know if or when Deutsche Bank may take over the
lender.
In the past four years, Deutsche Bank acquired Berliner
Bank AG, Nuremberg-based Norisbank AG and the Postbank stake, as
well as ABN Amro Holding NV’s commercial-banking operations in
the Netherlands and private wealth manager Sal. Oppenheim Group.
Basel Rules
Whether Deutsche Bank proceeds with a share sale will
depend on the financing commitment it gets from different banks,
one of the people said. Companies planning to sell stock
typically seek to find securities firms to guarantee the
offering, agreeing to buy stock that investors don’t order. Five
banks, including Deutsche Bank, agreed to underwrite National
Bank of Greece SA’s 2.8 billion-euro rights offering this week.
Proposed rules under consideration by the Basel Committee
on Banking Supervision may also lead banks to raise reserves.
Germany’s 10 biggest lenders, including Deutsche Bank and
Commerzbank AG, may need about 105 billion euros in fresh
capital because of new regulation, the Association of German
Banks estimated on Sept. 6.
The lenders would need to raise that sum to reach an
estimated 10 percent Tier 1 capital ratio, a key measure of
financial strength, according to Dirk Jaeger, who is responsible
for regulatory topics at the group.
»
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Gulp ...
Does anyone have a good marinate for this crow I just pulled out of the freezer .. Turd?
What was Turd saying?
I've been busting balls about gold ( my call down ). Talking up stock market your run of the mill hopium ...
The euro banking system not supporting my thesis.
gotcha!
I have a little poem I'd like to read in honor of this occasion, if I may. Spaulding, get your foot off the boat! :"It's easy to grin / when your ship comes in / and you've got the stock market beat. / But the man worthwhile / is the man who can smile / when his shorts are too tight in the seat"...ah-ha-ha-ha. OK, Pookie, do the honors.
I think a bottle of Goldschlager would do quite well.
Oh goody! Toxic waste about emerge from under the rugs at European banks. I can hardly wait.
In general it is good to be the first rat off the ship.
I'm not thinking about something small enough to fit under a rug.
I'm thinking the parts of an iceberg that you don't see.
Spot on Rocky! No wonder Ackermann's been looking so stiff lately - he's got an iceberg stuck up his ass!
only 9B? seems.....modest.
9B ought to be enough to support 270B of assets-earning or not!
9B will keep them going for a year maybe?
Europe will take it all down over the next few months.
Time to buy some puts!
Vols are actually down this morning/afternoon. More eco data next week to start a decline. Close lower fractionally today. Closing Dow 10,000 next Friday...
Yea, I thought EU banks were all good? Didn't they give them a THOROUGH stress test?
The EU banking crisis is coming back into full bloom. No, you can't bail out the insolvent with more debt.
This Fall will feature more of those dreaded (for the bulls) weekend announcements. The PTB has weeks, months, not years before the next roll-over. Might not be a sharp drop, but the decline will accelerate. QE II, III, IV on tap. No, they won't do much. A quick goose, before more declines.
Bond holders want their money back. The Prisoner's Dilemma - whoever gets out first usually wins, except when everyone wants out. Race to the Bottom!
Out of my way, traderjoe! LOL...
I wanna sink to the bottom with you
I wanna sink to the bottom with you
The ocean is big and blue
I just wanna sink to the bottom with you
Cars on the highway,
planes in the air
Everyone else is going somewhere
But I'm going nowhere,
getting there soon
I might as well just sink down with you
Deutschebank runs the DGP 2x gold ETN.
Something for us goldbugs to keep in mind.
WOW! Maybe now we get that EUR "AND" Treasury wanker banger together! That'll ding 'em a bit hey?
Will they accept an in kind exchange of AIG shares?
The stock market should be rallying. Could have been worse. They could be raising 10 billion instead of 9 billion.
Time to rally 1,000+
Oh wait a minute. Today one of the main headlines was: "Market higher as euro debt fear eases".
Looks like in coming days or weeks those Yahoo! Finance headlines may look slightly different.
Oh the sheep.....gonna go right over the cliff sooner or later.
$9 billion today, $18 billion tomorrow and etc until investors get sick of it. It is just the beginning of begging until the welfare stops.
Yawn. More of the same. 9 billion Euro ? Peanuts for Deutsche Bank shareholders. No big deal.
Reminds of something I read just yesterday in Reminiscences of a Stock Operator. There was a part in a major rally where a railroad announced a massive secondary. The next thing you know, all the railroads were announcing them at earlier dates than the previous one. They were all racing to soak up the last dimes availble in the market.
Hmmmm...
Now batting........UBS.
Just wait until SocGen's skirt starts to flutter
Maybe kerviel has a brother. When is the next 3 day weekend?
Why so much? 9 billion? I thought all 93 banks tested only had to put up 3.5 billion in total? It looks like the ECB and our Fed have something in common...they're both full of shit.
One would geneally wonder where the money comes from and then you realize that the $9 billion will be created out of thin air, laundered once then used to buy equity ... so viola, new debt becomes equity ... and off we go to leverage that.
Thank u, i found this for a long time.
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