|Bid||6.58 x 555100|
|Ask||6.58 x 230000|
|Day's Range||6.51 - 6.66|
|52 Week Range||5.78 - 8.85|
|Beta (3Y Monthly)||1.61|
|PE Ratio (TTM)||N/A|
|Earnings Date||Jan 30, 2020|
|Forward Dividend & Yield||0.11 (1.58%)|
|1y Target Est||N/A|
U.S. private equity meets German-style corporate governance, and frictions occur. There should be little surprise there, in a country whose staid business culture never seemed to provide a fertile ground for the creativity of U.S. financial capitalism. According to the Financial Times, distressed assets fund Cerberus Capital Management is pushing for the ousting of the chairman of Deutsche Bank, Germany’s largest bank, which has indeed seemed under serious stress for the best part of the last decade.
In the aftermath of a trading fiasco that cost JPMorgan Chase some $6bn and opened a chink in the armour of Wall Street’s favourite chief executive Jamie Dimon, one hedge fund was having a whale of a time. BlueMountain Capital Management had harpooned the “London Whale” in 2012 and then been brought in to clean up the mess, pocketing $300m in one trade and cementing the status of its co-founder Andrew Feldstein (pictured above) as a credit whizz. As it happens, that would turn out to be the peak of BlueMountain’s success.
American private equity firm Cerberus owns a 3% stake in Germany's Deutsche Bank AG (NYSE: DB) and is pushing for the ouster of Chairman Paul Achleitner, CNBC reported Tuesday, citing two sources. Achleitner was named chairman of Deutsche Bank back in 2012; since then, the stock has lost more than 70%. Most recently, the German bank failed to close a merger with Commerzbank, and this merely added to Cerberus' frustration, CNBC said.
Deutsche Bank's DWS asset management subsidiary is doing away with most titles as of next year, according to an internal memo on Tuesday. The abolition of positions like managing directors and vice presidents "will build a collaborative work environment with flat hierarchies based on functional roles, skills and capabilities as well as a clear performance culture", said the memo, seen by Reuters. DWS will still have a chief executive and chief financial officer.
(Bloomberg) -- Asset manager DWS Group GmbH & Co. has pulled the rungs off the corporate ladder.The firm majority-owned by Deutsche Bank AG plans to scrap titles such as associate, vice president and managing director by the middle of next year, according to an internal memo seen by Bloomberg.“We will build a collaborative work environment with flat hierarchies based on functional roles, skills and capabilities,” the internal memo said. “Each role will have a clearly defined description covering responsibilities and specific expectations and priorities.”A spokesman declined to comment on the memo.Deutsche Bank spun off DWS last year, though still owns nearly 80% of its shares. DWS has been the subject of repeated speculation about a possible merger with firms including the asset management unit of UBS Group AG.While Deutsche Bank sees “some form of consolidation” as necessary to develop DWS into a top 10 global asset manager, it has no plans to give up its majority stake, Chief Financial Officer James von Moltke said in July.While the corporate titles are disappearing, there will still be job expansions or significant role changes for individuals, according to the memo. Roles will take into account “the expertise needed, business impact, team management and expected relationships with other parts of the business. The compensation for each role will be aligned accordingly.”DWS Chief Executive Officer Asoka Woehrmann will retain his job title.To contact the reporter on this story: Suzy Waite in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Shelley Robinson at email@example.com, Chris BourkeFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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Increased taxes on the rich, in an attempt to narrow the divide, is a critical part of the campaigns.
Cerberus has lost faith in Deutsche Bank’s chairman Paul Achleitner and is pushing for him to be replaced, according to three people familiar with the worsening relationship between the US private equity firm and Germany’s biggest bank. The desire for regime change has hardened since Deutsche abandoned merger talks with Commerzbank in April, these people said, scuppering the plans of Cerberus, which is Deutsche’s third-largest shareholder with a 3 per cent stake and the second-biggest shareholder in Commerzbank. Mr Achleitner endorsed ending the talks.
Deutsche Bank chairman Paul Achleitner has evidently hit a bum note. Cerberus, the US private equity group named after the hell hound, is calling for him to be replaced. Since May 2012, Deutsche Bank has had four chief executives and one chairman.
(Bloomberg) -- Deutsche Bank AG told U.K. regulators that it’s facing persistent issues in processing high-value payments in the country, a further sign of the IT problems plaguing the lender.The German lender met with Bank of England officials two weeks ago to explain disruptions of payments going through the BoE’s high-value payments system CHAPS on several days in October, according to a person familiar with the matter. The bank has also discussed the issue with Megan Butler, head of supervision at the Financial Conduct Authority, according to the Financial Times, which first reported the news.As a result of Deutsche Bank’s problems, about 21,000 payments for online retailer Amazon.com Inc. were delayed in recent months, the person said, asking not to be identified discussing the private information.Deutsche Bank has long struggled to replace an aging IT infrastructure. Chief Executive Officer Christian Sewing last year appointed a new chief operating officer, Frank Kuhnke, to lead the drive and recently hired Bernd Leukert, formerly a senior executive at German software company SAP SE, as head of technology and innovation.Payments services is a core offering of Deutsche Bank’s transaction bank, which Sewing recently took out of the investment bank and turned into a standalone division now known as corporate bank. He has called the division the “DNA” of the bank and made it a centerpiece of his turnaround plan unveiled in July.“We continue to invest substantially in our IT and platform capabilities,” a Deutsche Bank spokesman said in an emailed statement. “We put mitigating steps in place to ensure that similar issues cannot re-occur.”CHAPS has 34 direct participants and processed 4.3 millions payments worth 7.5 trillion pounds ($9.6 trillion) last month, according to its website.To contact the reporter on this story: Steven Arons in Frankfurt at firstname.lastname@example.orgTo contact the editors responsible for this story: Dale Crofts at email@example.com, Christian BaumgaertelFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg Opinion) -- On Friday, judges in Milan convicted executives from the world’s oldest bank, Banca Monte dei Paschi di Siena SpA, for falsifying its accounts in collusion with Deutsche Bank AG and Nomura Holdings Inc. Some 11 years after the misdeeds, it’s hard to have complete faith in the ability of regulators to prevent similar bad behavior.That executives have been held accountable for one of Europe’s biggest banking scandals will be some comfort to savers and taxpayers. Deutsche and Nomura face financial penalties of $175 million (Paschi has already settled). Michele Faissola, Sadeq Sayeed and Giuseppe Mussari — formerly of Deutsche, Nomura and Paschi — were among 13 executives sentenced to jail, the most senior bankers convicted of crisis-era chicanery. Nomura is considering an appeal, while Deutsche will review the court’s ruling.Regulators don’t have much to take credit for here in reining in the excesses of these lenders. After hiding hundreds of millions of dollars in losses in 2008 and 2009, Paschi went on to build a mountain of bad loans that led to multiple taxpayer rescues. Deutsche, meanwhile, has only just embarked on a serious plan to restore profitability after myriad fines for dubious practices.The complex Deutsche derivatives trade at the center of the Milan trial was certainly ingenious. Dubbed Santorini, it made a loss disappear on a previous deal that would have blown a big hole in Paschi’s 2008 results. To do this, Deutsche made one bet on interest rates with Paschi that it would almost certainly lose and another wager that it would win. While Deutsche paid out immediately on the bet that Paschi won, the German bank let the Italian bank pay out on the wager that it lost over several years. That allowed Paschi to window-dress its accounts and hide the previous loss.The outside world would be none the wiser for years, until I came across documents that helped recreate the concoction. Within days of my article being published in January 2013, a similar deal emerged between Paschi and Nomura; Paschi said it would restate its accounts. The derivative dressed up as a loan was so successful for Deutsche it repeated the trade with clients around the world. The German bank also ended up correcting its figures.Given the widespread nature of the gimmickry, it’s reasonable to ask where the regulators were in all this. The simple answer: asleep at the wheel. For years (and well before my reporting) financial supervisors from New York to Rome were aware of how far these banks were pushing the envelope.As early as 2010, Italy’s central bank, then headed by former European Central Bank president Mario Draghi, had discovered that Paschi had been masking losses. The Bank of Italy said in a 2010 report that it didn’t have “powers as regards accounting” and that the matter needed further study.There was no great rush. The same Paschi managers remained in place through 2012. In the meantime, the bank’s bad loans were piling up as local political interference and reckless lending led it to overlook credit risk. Bailout followed bailout as losses mounted.As recently as 2016, Paschi was probably insolvent and its financial controls were still deemed perilously weak. That didn’t stop the ECB in 2017 nodding through the lender’s third helping of state aid in less than a decade. Over and over, supervisors failed to pick up on practices detrimental to Paschi’s longer-term viability.Deutsche’s rehabilitation has been torturous too. It wasn’t until 2015, well after the bank had been embroiled in multiple scandals — from rigging benchmarks to laundering dirty Russian money — that regulators sought to tame its risk-taking ethos. Under former chief executive officers Anshu Jain and his predecessor Josef Ackermann, Deutsche Bank had become a factory of risky and complex trades from its London hub as it sought to compete head on with Wall Street. Only now, under chief executive officer Christian Sewing, is the German giant attempting a deep reboot of the business by shrinking its trading unit. Unfortunately the ambitious reorganization has coincided with an economic slump.Of course, there are many obstacles that regulators will point to that complicate their roles, not least the need to tread carefully to maintain financial stability — especially at a systemically critical lender such as Deutsche.But by failing to place sufficient pressure at the right time, regulators have allowed the banks they oversee to delay the inevitable: These companies need to find other ways to make money. European bank valuations are close to the level they were in the 1980s; confidence in the industry is fragile.There is some optimism that the shift of bank regulation from the national level to the European level, via the ECB, will strengthen supervision. The deepening of a euro zone banking union with a common deposit insurance scheme, championed last week by Germany’s finance minister Olaf Scholz, would further erode national meddling.Unfortunately the ECB’s early record as a watchdog has been mixed. Draghi’s successor Christine Lagarde has pledged to keep banks safe. She also needs to keep them honest.To contact the author of this story: Elisa Martinuzzi at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg Opinion) -- European fund management companies spent 2018 watching their share prices steadily decline, battered by increased regulatory scrutiny, customers withdrawing money and the relentless squeezing of fees. They’ve rallied this year, but the industry’s biggest beast in the region is outpacing its peers by an astonishing margin.Investors in Amundi SA have enjoyed a total return of more than 60% in 2019, outpacing the Stoxx Europe 600 index by 35 percentage points. The stock has beaten the 32% gains at DWS Group GmbH and Standard Life Aberdeen Plc, the 39% return for Schroders Plc and Man Group Plc’s 19% rise.Amundi, 68 percent-owned by France’s Credit Agricole SA, recently announced record quarterly inflows of almost 43 billion euros ($48 billion) in the three months through September, breaking a streak of three consecutive quarters of client withdrawals. Its 1.6 trillion euros of assets under management — up from 952 billion euros when it listed on the stock market in November 2015 — make it Europe’s biggest money manager.The most impressive statistic, however, is the one element of Amundi’s financials over which it has most control: its costs.The company’s frugality has nudged its cost-to-income ratio lower in recent years; it fell to an industry-beating 51.1% at the end of the third quarter. By comparison, Deutsche Bank AG-controlled DWS aims to cut its ratio to 65% and doesn’t expect to achieve that until the end of 2021.What could knock Amundi off its perch? Well, DWS Chief Executive Officer Asoka Woehrmann told the Financial Times this month that he plans to challenge his rival’s dominance by finding a takeover or merger that would increase his firm’s 752 billion euros of assets. Earlier this year Switzerland’s UBS Group AG was reported to be considering strapping its fund management arm to DWS. Insurer Allianz SE was also said to be interested in the German investment firm. Any such deal would create a challenger with the scale to match Amundi.But the French fund giant’s CEO Yves Perrier is unlikely to just stand by if industry consolidation begins. Now that he’s finished absorbing Pioneer Investments, a fund management unit bought from Italy’s UniCredit SpA for 3.5 billion euros in 2017, the decks are clear. While these mega-mergers might not happen, Amundi is well placed if they do. With its shares trading at their highest in more than 18 months, Perrier has the currency to fund a deal.To contact the author of this story: Mark Gilbert at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Asoka Wöhrmann took on one of the investment industry’s most difficult roles last year when he was promoted chief executive of DWS, Germany’s largest asset manager. Nicolas Moreau, his predecessor, was brutally axed after two years in the role after DWS failed to meet ambitious performance targets agreed at the time of the company’s March 2018 initial public offering. The IPO followed a protracted period of instability that included several failed efforts by its parent, Deutsche Bank, to sell the €752bn asset management business, multiple reorganisations and the departure of numerous senior staff members.
Deutsche Bank has been forced to admit to regulators its role in the UK payment system still suffers serious problems, years after it was first placed in remediation, which has led to tens of thousands of transactions for clients such as Amazon being held up. Deutsche executives met Bank of England officials two weeks ago to explain the latest failings. The BoE demanded an explanation as to why the bank’s systems were disrupted on 10 per cent of business days in October, putting Deutsche among the least-reliable participants in CHAPS, the clearing house automated payment system, despite being in remediation over the matter for at least three years.
An Italian court has convicted 13 former bankers from Deutsche Bank, Nomura and Monte dei Paschi di Siena over derivative deals that prosecutors say helped the Tuscan bank hide losses in one of the country's biggest financial scandals. Monte dei Paschi reached a settlement with the court over the case in 2016 at a cost of 10.6 million euros.
Thirteen former bankers from Monte dei Paschi di Siena, Nomura and Deutsche Bank were sentenced to jail on Friday after a case that shook Italy’s establishment and fomented the rise of populism in the country. The sentences — among the harshest handed out to bankers convicted of financial crimes in living memory — were delivered in Milan after the men were found guilty of helping Monte dei Paschi hide hundreds of millions of euros in losses between 2008 and 2012, using complex derivatives contracts. The verdict, read by Milan judge Lorella Trovato, was delivered to a packed courtroom in a fascist-era courthouse, the site of high-profile mafia trials and former prime minister Silvio Berlusconi’s court cases.
Citigroup Inc and Deutsche Bank AG may cross-examine four antitrust investigators involved in a criminal cartel prosecution against them, an Australian court ruled on Friday, a win for the defence in a closely watched legal battle. Citi, Deutsche, ANZ and eight of their staff were charged last year with withholding crucial information from shareholders about the sale.
Commerzbank has warned it will miss its full-year profit target despite beating expectations in the third quarter, as economic weakness and ultra-low interest rates bite. Germany’s second-largest listed lender said on Thursday that full-year net profit would be lower than in 2018, downgrading previous guidance for a slight increase. Commerzbank shares, which have lost a quarter of their value since the merger negotiations ended in April, were down 1.7 per cent in morning trading on Thursday.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Commerzbank AG downgraded its full-year profit outlook, marking a second retreat in weeks by Chief Executive Officer Martin Zielke after the European Central Bank took rates deeper into negative territory.The bank said net income for this year will now probably be lower than in 2018, down from the lender’s target of a slight increase, after the ECB cut the deposit rate to minus 0.5% and because of higher taxes. While the more pessimistic outlook comes after the lender abandoned its ambitions of increasing revenue this year, Commerzbank did join lenders including Societe Generale and UniCredit SpA boosting its capital buffers in the third quarter.European banks are struggling with the impact of negative rates on lending income and a worsening economic environment. German finance minister Olaf Scholz on Wednesday reopened the debate on consolidation as a potential solution to the continent’s banking ills with proposals to break the deadlock on banking union -- seen by many executives as necessary before deals can take place.Commerzbank shares gained as much as 2.6% in early Frankfurt trading, before paring gains to rise 1.1% as of 9:07 a.m.Several top investors and regulators have privately expressed skepticism about the latest turnaround plan, people familiar with the matter have said. In addition to promising to reduce the workforce by over 2,000, Zielke has also said he’s selling one of the company’s strongest profit engines, its Polish subsidiary mBank, while saying profitability will remain well below that of the competition for at least the next four years.“The further monetary policy easing announced by the European Central Bank in September and the resulting pressure on margins will have a negative impact on earnings,” Commerzbank said in its earnings statement, adding that it expects a “significantly higher tax rate in the fourth quarter.”The bank is grappling with strategy after talks to create a merger with German rival Deutsche Bank AG fell through earlier this year. Germany had been interested to create a large domestic-focused lender to ensure credit to its export-oriented economy during a downturn, but Deutsche Bank CEO Christian Sewing balked at the execution risks of a deal.Commerzbank last week released preliminary results for the third quarter showing net income jumped 35% in the period as risk provisions and other costs declined. The bank also sold a unit in the quarter, accounting for one-off revenue of 103 million euros ($114 million).Corporate ClientsThe corporate clients division, which has long been a particularly sore spot, continued to show a weak performance as revenue fell for a fifth consecutive quarter. The current division head Michael Reuther, will be succeeded in January by former ING Groep NV executive Roland Boekhout. The bank is also seeing more change in the board, with Chief Financial Officer Stephan Engels set to join Danske Bank A/S.Though the lender’s other core division, the one catering to retail clients, posted revenue growth, most of that came from the Polish subsidiary it’s now seeking to sell. By contrast, the German retail unit, which is the division’s biggest source of revenue by far, contracted 6%. The bank has said it’s shifting its focus from rapid client acquisition to getting existing clients to spend more money on banking services.As part of the September revamp, the lender also decided to scrap its previous promise -- and a major element of its previous marketing campaign -- to keep a network of about 1,000 branches in Germany. The retail division under Michael Mandel said it’s going to close about a fifth of those.(Adds failed merger talks with Deutsche Bank in sixth paragraph.)To contact the reporter on this story: Steven Arons in Frankfurt at firstname.lastname@example.orgTo contact the editors responsible for this story: Dale Crofts at email@example.com, Ross LarsenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg Opinion) -- Germany’s finance minister Olaf Scholz acknowledged this week that the European Union needs to make progress on cementing a banking union. The bloc’s growing reliance on American and British banks to underwrite the bulk of its capital markets activity, combined with the prospect of Brexit putting up barriers to European lenders accessing London-based capital, helps explain his new urgency.While domestic politics is playing a part in Scholz’s newfound warmth for the project (as my colleague Leonid Bershidsky argues here) and his insistence on important red lines may hinder progress (as Ferdinando Giugliano suggests here), he described his key motivation in an article for the Financial Times succinctly:Now that the U.K., home to London's capital markets, is on the verge of withdrawing from the bloc, we must make real progress. Being dependent for financial services on either the U.S. or China is not an option. So if Europe does not want to be pushed around on the international stage, it must move forward with key banking union projects, as well as the complementary project of capital markets union.Companies in Europe, the Middle East and Africa have raised more than $78 billion in equity offerings this year. In equity underwriting, Wall Street banks are becoming more dominant as Deutsche Bank AG and BNP Paribas SA, the EU-27’s biggest players in this field, cede market share.More than 40% of that underwriting business was led by JPMorgan Chase & Co., Morgan Stanley, Goldman Sachs Group Inc. and Citigroup Inc. Deutsche Bank’s market share has more than halved in three years.There’s a similar picture in the league tables for international bonds, where borrowers have raised more than $3.8 trillion this year. JPMorgan’s position as top lead underwriter in that category gives it a market share of almost 8% for the past three years, double that of Deutsche Bank. While BNP has increased its share to 4.4%, it remains well behind JPMorgan, Citi and Bank of America Corp. as well as London-based HSBC Holdings Plc and Barclays Plc.So Scholz is absolutely right to worry that the EU risks being starved of capital if its financial services industry continues to stumble from crisis to crisis and its markets remain fragmented. The plan earlier this year to create a national banking champion by merging Deutsche Bank with Commerzbank AG — a project endorsed by Scholz — was doomed to fail. But a cross-border European champion able to compete with Wall Street and the City of London is sorely needed.To contact the author of this story: Mark Gilbert at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.