Deutsche Bank's board of directors has given the go-ahead for an 8 billion euro capital increase. The operation, explains a note from the leading German bank, will take place through the issue of 687,5 million new shares which will initially be subscribed by Credit Suisse, Barclays, Goldman Sachs, BNP Paribas, Commerzbank, HSBC, Morgan Stanley and UniCredit. The subscription period will open on March 21st and close on April 6th.
The objective is to achieve a Cet1 ratio of 14,1% and a leverage ratio of 4,1%. Another 2 billion will be raised through the sale of assets and the IPO of a minority stake in the Deutsche Asset Management.
Deutsche Bank's board of directors has also decided to sell a stake in the asset management unit over the next 2 years. On the other hand, the stake in Postbank, with its 14 million customers, will be kept within the group perimeter.
Green light also to a cost reduction plan of 2 billion euros by 2018.
In terms of accounts, Deutsche Bank closed 2016 with a loss of 1,4 billion euros, well above expectations, in the wake of legal costs, declining revenues and restructuring costs. The result follows the loss of 6,8 billion recorded in 2015.
In the fourth quarter of 2016 alone, the German bank recorded a net loss of 1,9 billion euros linked to the more than 7 billion dollars paid to the US for its role in the subprime crisis.
