Deutsche Bank reports 2.2-bn euro hit from subprime crisis

FRANKFURT, Oct 3, 2007 (AFP) – Deutsche Bank, Germany’s biggest lender, said Wednesday it would take charges of roughly 2.2 billion euros (3.1 billion dollars) to cover losses connected with the US home-loan crisis. Many major banks have decided to make clear their losses from the global banking crisis as quickly as possible to try to put the issue behind them. But the bank still expected its net third-quarter profit to exceed 1.4 billion euros, it said.

Chairman Josef Ackermann told an investor conference in London that the bank would book the charges to cover leveraged loans and loan commitments, as well as losses from “structured credit products, residential mortgage-backed securities and relative value trading in both credit and equities.”

As a result of those charges, the bank’s corporate banking and securities division “as a whole is likely to report a net pre-tax loss in the quarter, currently estimated in the range of 250-350 million euros,” a statement said.

The news came two days after two other global banking giants, Citigroup of the US and the Swiss bank UBS said they had also been hit hard by turbulence after the US market for high-risk home loans, the subprime market, collapsed.


Notify of
Inline Feedbacks
View all comments