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Deutsche Bank chief seeks to quash state aid rumours

A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2015, after shares in Deutsche Bank, Germany's biggest lender, hit a record low. 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. / AFP PHOTO / DANIEL ROLAND / “The erroneous mention[s] appearing in the metadata of this photo by DANIEL ROLAND has been modified in AFP systems in the following manner: [-A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2016.--] instead of [-A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2015.-]. Please immediately remove the erroneous mention[s] from all your online services and delete it (them) from your servers. If you have been authorized by AFP to distribute it (them) to third parties, please ensure that the same actions are carried out by them. Failure to promptly comply with these instructions will entail liability on your part for any continued or post notification usage. Therefore we thank you very much for all your attention and prompt action. We are sorry for the inconvenience this notification may cause and remain at your disposal for any further information you may require.”

A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2015, after shares in Deutsche Bank, Germany’s biggest lender, hit a record low.<br />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. / AFP PHOTO / DANIEL ROLAND / “The erroneous mention[s] appearing in the metadata of this photo by DANIEL ROLAND has been modified in AFP systems in the following manner: [-A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2016.–] instead of [-A display showing the German Stock Market Index DAX is pictured at the stock exchange in Frankfurt, Germany, on September 26, 2015.-]. Please immediately remove the erroneous mention[s] from all your online services and delete it (them) from your servers. If you have been authorized by AFP to distribute it (them) to third parties, please ensure that the same actions are carried out by them. Failure to promptly comply with these instructions will entail liability on your part for any continued or post notification usage. Therefore we thank you very much for all your attention and prompt action. We are sorry for the inconvenience this notification may cause and remain at your disposal for any further information you may require.”

Deutsche Bank does not need state aid, the chief executive of Germany’s biggest lender said in a newspaper interview Wednesday, seeking to quash rumours that have hammered its share price.

State aid “is not on the table”, John Cryan told Germany’s biggest-selling newspaper Bild.

“At no point did I ask for help from the Chancellor,” he added, responding to reports in the German press at the weekend that Angela Merkel had refused to come to Deutsche’s rescue.

Shares in the bank hit a record low on Monday, dropping 7.54 percent to close at 10.55 euros ($11.80) and recovering little of the lost ground on Tuesday.

Investors were spooked after it emerged in mid-September that the US Department of Justice (DoJ) is seeking a $14-billion fine from Deutsche over its role in the subprime mortgage crisis.

“It has been clear from the beginning that we won’t pay this amount,” Cryan told Bild, adding that “we expect the DoJ will treat us just as fairly as the American banks” that have settled their cases with much lower payouts.

Analysts expect Deutsche will be able to negotiate down its bill with the US authorities in the subprimes case, but it is not clear whether the $5.5 billion the bank has set aside to cover its legal costs will be enough.

That fear has weighed on the bank’s share price, as the value of its existing stock will be diluted if the bank is forced to raise more capital on the markets.

“At the moment there is no question of a capital increase,” Cryan told Bild.

“We have far fewer risks on our books than before and we have a comfortable supply of free liquidity, of cash,” he said.

Cryan, in the post at the head of Deutsche Bank for a little over a year, has launched a massive restructuring of the Frankfurt institution, planning to slash 200 branches in Germany and almost 9,000 jobs worldwide by 2020.

Shares in the bank have lost more than half of their value since January after the bank booked an almost 7-billion-euro loss in 2015.



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