Deutsche Bank shares hit record low as Germany refuses aid
FRANKFURT: Shares in Deutsche Bank, Germany’s biggest lender, hit a record low on Monday after reports at the weekend that Berlin had refused state aid for the embattled lender.
The sell-off saw shares plunge by more than 6.14% to stand at 10.65 euros, making it the DAX 30’s worst performer. At one point, the shares stood at 10.63 euros, a historic low.
“Given the state of the news, people are selling almost in a panic,” said analyst Michael Seufert of NordLB bank.
Investors were blindsided by news earlier this month that US regulators were seeking a $14-billion fine from Deutsche Bank over its actions leading up to the subprime mortgage crisis in 2008.
And German news weekly Focus at the weekend reported that chancellor Angela Merkel had ruled out any chance of offering state aid or interceding with the US authorities. “There’s no reason at the moment why the bank would have to ask the government for help,” Seufert pointed out.
But investors fear that even if Deutsche negotiates a much lower deal with the US Department of Justice, the looming fine will still exceed the $5.5 billion the bank has set aside to cover its roughly 8,000 open legal cases.
