Deutsche Bank increases capital He needs money for acquisitions Postbank

The leader of the banking sector in Germany Deutsche Bank (DB) is preparing the biggest difference in their recent history of increasing equity. As a result of the additional issue of its shares of the bank intends to bail out 9 billion euros. The money will be directed to the full redemption of securities Postbank. As a result, the number of private clients DB should double.

According to information received Handelsbank of the financial community, the head of Deutsche Bank Josef Ackermann and his chief financial officer Stefan Krause complete now negotiating with investment banks, and now may be known which of them will be the organizer of the forthcoming in the coming weeks additional issue. Issue of new shares for sale will allow Postbank DB closer to his goal - to reduce dependence on the volatility-prone areas of investment banking. And if in 2013 or even earlier, Mr. Ackermann will relinquish its seat successor, then give him a stable financial structure, based on its investment banking business and private clients.

The expansion of the local market has already begun DB, absorbing previously Berliner Bank, Norisbank and Bank Sal. Oppenheim, as well as gaining nearly 30% stake in Postbank. Incidentally, if the DB will be the sole owner of Postbank (DB has an option to acquire all the securities of the bank), it would mean that the current number of its private customers (14 million) increase immediately doubled.

However, as recently noted chief financial officer Stefan Krause, DB, deal with the Postbank «not so easy. When in 2008, Josef Ackermann bought a stake in Postbank at this bank owned the entire e-mail group Deutsche Post, capital adequacy ratio of the subject transaction was very low and amounted to 7,3%. No wonder that in the course of this summer, the European Regulators stress tests assessing Postbank were worse than any other German bank.

Now, if DB really intends to fully acquire Postbank, something other than 3 billion euros to buy itself it needs to raise at least another 5 billion euros - in order to maintain its capital adequacy ratio at 10% or higher. Besides, we should not forget that on the balance Postbank lurking still illiquid assets of almost 6 billion euros. In this regard, Thomas Shtegner of investment bank Macquarie believes that in order to buy Postbank not worsen the capital adequacy ratio DB, it should be 9.6 billion euros.

Experts believe that Messrs. Ackermann and Krause decided to act now because they want ahead of other banks, which will inevitably rush to the money market in order to meet more stringent requirements on the amount of equity under the new rules of Basel III ». From the comments in this regard the official representative of Deutsche Bank abstained. Meanwhile it became known that an increase in capital planning and the second largest bank of Germany - Commerzbank, but the timing of the additional issue he had not yet determined.