Posts tagged "Ackermann"
When will Deutsche Bank stop frittering away its capital?

When will Deutsche Bank stop frittering away its capital?

Last week, an article by Antoine Gara in The Street.com argued that Deutsche Bank should cut its planned dividend payments for 2013.  Recall that the bank has set a payout of €.75 per share, which the article notes exceeds the bank’s profits last year. Meanwhile, the bank’s recent earnings revision, which came about as a result of its decision to set aside an additional € 600 million for anticipated settlements of mortgage litigation and the Iran sanctions and LIBOR investigations, caused the Tier 1 capital ratio to fall from 8.0% to 7.8%.  According to Gara: Although Deutsche Bank could have minimized the capital hit of its earnings revision by cutting the dividend, the bank remains committed to a payout that would be unlikely to pass the Federal Reserve’s muster in the United States. Deutsche Bank’s rising legal costs and signs that regulatory probes may soon hit the bank’s pocket book... {read more}
Ackermann’s last call: No More Government Money for DB, (unless it’s lucrative and secret)

Ackermann’s last call: No More Government Money for DB, (unless it’s lucrative and secret)

Update: On March 8, 2012, the Financial Times reported that Deutsche Bank “had taken at least €5bn-€10bn of LTRO money in the February auction.” According to the report, Deutsche “tapped a large portion of the funds via its subsidiaries in Spain and Italy.” {read more}

Deutche Bank’s Ackermann pledges to do “everything in our power” to avoid a forced recapitalization

Last week was a tough week for Deutsche Bank, its too-big-to-fail peers and European finance officials. On Tuesday Silvia Quandt Research analyst Michael Rohr told Dow Jones that Deutsche Bank would face a capital shortfall of more than EUR9 billion if it wrote down its sovereign debt exposure to market value and was expected to hold core Tier 1 capital of at least 10% under Basel III banking rules. [1] On Thursday, Credit Suisse put out a report claiming that as many as 66 European banks could fail new supposedly-tougher stress tests (based on Basel III definitions of capital), with RBS, Deutsche Bank, and BNP needing the most capital – at €19bn, €14bn and €14bn respectively.[2] Then ratings agency Fitch piled on, putting a number of those banks, including Deutsche Bank, on negative watch “as “the ongoing Eurozone crisis continues to feed intense market speculation regarding the potential for bank... {read more}
Is Deutsche Bank’s Ackermann "one of the most dangerous bankers in the world?"

Is Deutsche Bank’s Ackermann “one of the most dangerous bankers in the world?”

Last April, MIT professor and former IMF economist Simon Johnson called Deutsche CEO Josef Ackermann “one of the most dangerous bankers in the world.” Johnson, who made this remark in an interview with the left-leaning German daily Die Tageszeitun, singled out Ackermann because of Deutsche Bank’s longstanding profit target of 25% return on equity, and because of what he called “excessive risk taking” by the bank. {read more}