Deutsche Bank : watch

gerhard dengler

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Perhaps there is a thread already created discussing Deutsche Bank, but with the site search function still not working it is not possible to verify this.

In the meantime, the German behemoth bank called Deutsche Bank has been served with $14 billion fine by the American Department of Justice (DOJ) yesterday for mis-selling mortgage backed securities over a number of years.

Deutsche Bank have confirmed that they intend to negotiate a far lower settlement.

A couple of things.
Given that the EU have imposed €13 billion tax charge on American/stateless company Apple, which the Irish state intend to appeal, one could draw the inference that the Deutsche Bank fine could be retaliation.
However other banks have been caught and fined for mis-selling similar mortgage backed securities by the DOJ.

What is interesting is the effect that this fine has had on Deutsche Bank and the effect on confidence generally in that bank.
Deutsche's share price has been falling and this fine further exacerbates the fall in Deutsche's share value (share price fell by 7% in early trade)
US asks Deutsche Bank for $14bn to settle mortgage investigation - BBC News

The real question is does Deutsche have the resources to pay $14 billion fine and how would payment affect it's reserves?

In 2007 Deutsche Bank shares were trading at over €100, today they're at €12.
€10.00 per share threshold is the rubicon. If Deutsche's share prices falls below €10.00 then this would spell the evaporation of confidence in Deutsche.
At that stage, we're looking at Lehman Bank scenario.
 


gerhard dengler

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Was the EU commission too busy then?
The fine is for the mis-selling of mortgage backed securities in the USA.

You raise an interesting point, was there mis-selling of mortgage backed securities in Europe by Deutsche (or any other bank)?
And if so, why haven't these cases been pursued?
 

gleeful

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When you want to search, google this:

site: politics.ie search term

ie...

site: politics.ie deutsche bank
 

Fractional Reserve

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The old tit for tat you nail our multis we nail you're banks , great craic .

Perhaps there is a thread already created discussing Deutsche Bank, but with the site search function still not working it is not possible to verify this.

In the meantime, the German behemoth bank called Deutsche Bank has been served with $14 billion fine by the American Department of Justice (DOJ) yesterday for mis-selling mortgage backed securities over a number of years.

Deutsche Bank have confirmed that they intend to negotiate a far lower settlement.

A couple of things.
Given that the EU have imposed €13 billion tax charge on American/stateless company Apple, which the Irish state intend to appeal, one could draw the inference that the Deutsche Bank fine could be retaliation.
However other banks have been caught and fined for mis-selling similar mortgage backed securities by the DOJ.

What is interesting is the effect that this fine has had on Deutsche Bank and the effect on confidence generally in that bank.
Deutsche's share price has been falling and this fine further exacerbates the fall in Deutsche's share value (share price fell by 7% in early trade)
US asks Deutsche Bank for $14bn to settle mortgage investigation - BBC News

The real question is does Deutsche have the resources to pay $14 billion fine and how would payment affect it's reserves?

In 2007 Deutsche Bank shares were trading at over €100, today they're at €12.
€10.00 per share threshold is the rubicon. If Deutsche's share prices falls below €10.00 then this would spell the evaporation of confidence in Deutsche.
At that stage, we're looking at Lehman Bank scenario.
 

Lumpy Talbot

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No
Perhaps there is a thread already created discussing Deutsche Bank, but with the site search function still not working it is not possible to verify this.

In the meantime, the German behemoth bank called Deutsche Bank has been served with $14 billion fine by the American Department of Justice (DOJ) yesterday for mis-selling mortgage backed securities over a number of years.

Deutsche Bank have confirmed that they intend to negotiate a far lower settlement.

A couple of things.
Given that the EU have imposed €13 billion tax charge on American/stateless company Apple, which the Irish state intend to appeal, one could draw the inference that the Deutsche Bank fine could be retaliation.
However other banks have been caught and fined for mis-selling similar mortgage backed securities by the DOJ.

What is interesting is the effect that this fine has had on Deutsche Bank and the effect on confidence generally in that bank.
Deutsche's share price has been falling and this fine further exacerbates the fall in Deutsche's share value (share price fell by 7% in early trade)
US asks Deutsche Bank for $14bn to settle mortgage investigation - BBC News

The real question is does Deutsche have the resources to pay $14 billion fine and how would payment affect it's reserves?

In 2007 Deutsche Bank shares were trading at over €100, today they're at €12.
€10.00 per share threshold is the rubicon. If Deutsche's share prices falls below €10.00 then this would spell the evaporation of confidence in Deutsche.
At that stage, we're looking at Lehman Bank scenario.
That could be interesting politically with Deutsche Bank boardmembers shrieking at Frau Merkel that Deutsche Bank is 'systemic' and demanding a bailout straight away.

The strange thing is that Deutsche is actually quite intrinsic to the German economy in a way that Anglo Irish wasn't in the Irish economy.

There will be some heavy politics in this. Merkel will just have to turn on her 'phone and wish aloud that Washington would help her out by leaning on the American DOJ to reduce the fine down to a paltry couple of billion. The Americans will be monitoring her phone anyway so it would save her the few euros on her monthly minutes.

Could knock finally on the head this notion that German banks were all hunky dory and that it was only the PIIG nation banks that were messing about with dodgy derivatives based on shyte mortgage packages.

If Deutsche were at it the other German banks would have been at it as well.
 

HarshBuzz

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Mrwoody

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They should have fined them 13 billion just to get the conspiracy theorists going.
 

gerhard dengler

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If there is no negotiated settlement between Deutsche Bank and DOJ, and the $14 billion fine gets enforced, has Deutsche Bank the capacity to withstand that level of fine?

How weak/strong is Deutsche Bank? I think this is the real question. If she's as weak as some commentators suggest, then she is in big trouble.
And if she's in trouble, given her size, every counterparty to her will be effected as well.

There are literally billions of reasons why Deutsche Bank cannot be allowed fail.
 

NMunsterman

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I turned down a job at DB recently as I think the opposite.
Very wise move.
Their exposure to derivatives is in the order of 20 x times the entire German GDP - according to some, derivatives is little more than a legalized financial equivalent of a game of "Black-Jack".
 

YouKnowWhatIMeanLike

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I'd say about time for the EC to take down GE. there a plenty in the queue. BofA, JPM and WF, Citi sold their crap in the EU many times over.

But indeed it's quite remarkable how well connected Deutsche is. Some might even say it's the uberbank of all the banks. But whatever happens Deutsche will continue in one way or another. 14bn is peanuts for this monster of a bank. And the real amount the one they will be charged with we all know already will be minuscule in comparison.
 

Mad as Fish

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Yeap and if the Gobshytes in Brussels keep at it the Yanks will reciprocate
Which in the long term might make for a better world as companies start to observe the rules that are in place usually for very good reasons.
 

Lumpy Talbot

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No
Current nickname for Deutsche Bank on the London market is derived from their stock exchange designation DBAG- 'douche bag'.
 
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I won't mention the bank involved, but I remember reading a lovely phrase on their intranet. The phrase was "compliance fees" and was included in their annual report to shareholders as a line item in the financial accounts.

Now, "compliance fees" on the face of it could refer to maybe a more one-off expediture which consisted of getting highly-paid consultants in to research your (for example) SOx compliance and the costs of implementing their recommendations, of training staff and management etc, and creating a day zero whereby the bank was fully compliant with all of its regulatory requirements, right?

No. The "compliance fees" were fines. Non-compliance costs, if you like.

Weren't BNP done for seven billion a couple of years ago?
 


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