On Tuesday, shares of Deutsche Bank slumped to a new low. On Tuesday afternoon, the shares were worth only € 11.20 per share. Such a low price was reached last more than 30 years. At the end of trading shares depreciated by 4.8% to € 11.24 per share.
The collapse of stocks reflects the collapse of the bank itself with over 100,000 employees worldwide, which passes through the greatest crisis in its corporate history.
Germany’s largest financial institution recorded during the past fiscal 2015 a record loss of 6.8 billion euros. In the first half of 2016 was only achieved a formally small profit because some interest payments were not included. Earnings per share, however, went in the red territory, said DPA.
Investors are concerned because of the relatively weak capital base. Also in the stress test of the European Supervisory Authority EBA bank failed to show excellent results. Following the publication of the results on Friday it appeared that Deutsche Bank was among the worst performing 10 of 51 surveyed banks.
In the worst shock scenario, the bank achieves indicator Equity Tier 1 (ratio of core capital Tier, CET1) – capital to risk assets amounting to 7.8%.
Meanwhile, the company estimated on the stock exchange at about only 27 percent of its book value, ie the total value of the identifiable assets. This is a devastating figure because it shows that investors doubt the quality of the assets on the balance sheet – or even in the accounting in the bank.
Тhe last time the bank’s shares were at such a low level, Deutsche Bank was an entirely different and above all much smaller group that focuses primarily on Germany and Europe, especially over the traditional business with private and corporate customers. Only through the acquisition of Anglo-Saxon investment banks Morgan Grenfell and Bankers Trust in 1989 and 1998, the bank rose among the largest banks in the world.