Deutsche Bank on Life Support?

(UK Telegraph) Deutsche Bank is to cut 1,900 jobs in an effort to save €3bn, as Germany’s  largest lender revealed profits almost halved in the second quarter.

A file photograph showing the a bundle of euro bank notes leaning against a savings box infront of the twin towers of the Deutsche Bank in Frankfurt, Germany, 25 January 2006

The cull will happen mainly outside of Germany, and comes in response to a slowdown in financial market activity.  The move marks an about-turn for the bank, which in April said it saw no need for layoffs at its investment bank.  It comes as Deutsche, Switzerland’s UBS, and Spain’s BBVA all reported lower profits on Tuesday, warning that the ongoing eurozone debt crisis was sapping the confidence of investors and clients. Meanwhile, countries such as Sweden continue to thrive, with personal loans at a steady growth rate, and lenders seeing enviable returns. Sites such as Buffert highlight just how effective the Swedish loan market is – and just how the Swedish model of lending could be the way forward.

Deutsche said its bottom-line profit was slashed nearly in half by the eurozone debt crisis in the second quarter.  The lender said in a statement its net profit amounted to €661m (£515.8m) in   the period from April to June, compared with €1.2bn during the same period   last year.


Back on April 26th, when DB was just off its 52-week high, I warned that it was in danger of collapse.  The past 90 days seems to be bearing that premise out:

As I have previously stated, “Deutsche is the biggest bank in Germany, and Germany is the largest and strongest economy in Europe… so the consequences of any major damage (or cumulative smaller damaging events) to DB would very likely cascade throughout the Euro-Zone, with terminal results.  The echo-effect of any major diminution in DB’s value, or loss of public confidence in the bank, would cause losses throughout the Euro market, which would in turn do further damage to Deutsche (increased default rates on loans, and loss of value on other bank-owned assets in the EU market) – so we have the prospect of a runaway train crash in its most naked state.

Also of interest is that, because DB has such a large footprint in the US real-estate markets (both residential and commercial), the terminal results would be felt here without much delay, as any “restructuring” of Deutsche Bank NA’s “assets” (real estate loans) would cause a flurry of value assessments on the assets (properties) underlying the loans, as part of the “due diligence” process such an event would necessitate.  By this mechanism, any restructuring of Deutsche would likely trigger another major round of real-estate devaluation in the US.  The reality is quite stark: Deutsche will, quite probably, be the trowel by which we unearth the rest of the fraud and mis-valuation in our own real-estate sector… I believe it is only a matter of time before this happens, and see DB as the probable trigger.”

Having sounded the alarm back in April that as DB goes, so goes the rest of the western banking system and the society which created it.

I believe that we have indeed seen the successful conclusion of the Middle Game between Asia and the West, and the beginning of the End Game has begun, where we see the blockading and destruction of the passed pawn (Iran) and the placing of all pieces into active positions (war and martial law).

The definitive mark of End Game prosecution, the win-or-loose moment, is the offensive use of the King (Obama?) and the…frequently sacrificial… use of the Queen (Angela Merkel? ) to break the opponent’s defenses…

What comes next will be very *interesting*.


~Those who abuse Liberty, sentence themselves to death!

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1 Response to Deutsche Bank on Life Support?

  1. Pingback: Deutsche Bank: Aaaaaaand It’s gone… | NCRenegade

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