Deutsche Bank has steep Q4 loss of $2.91 bn, Juergen Fitschen, Anshu Jain says biz strong
better than it was at the same time in 2012, with the U.S. economy recovering and a reduction in financial-market turmoil in the eurozone. He warned on a conference call with analysts however that the bank's restructuring was ``a journey that will take years, not months.''
Like all global banks, Deutsche Bank is under pressure from an international effort, known as Basel III, to hold more capital as a buffer against losses. Basel III is a response to the financial crisis that began in 2007 with large bank losses on mortgage-backed securities in the United States and worsened with the collapse of U.S. investment bank Lehman Brothers.
Building larger capital buffers can mean either raising capital by selling new shares, or by exiting risky investments and holdings _ since the capital requirement is measured against the value of outstanding loans and investments adjusted for how risky they are. The more risky a security or asset, the more capital must be held.
Deutsche Bank has put many of these assets in a separate unit which will manage their disposal. Jain said the bank's efforts during the year at selling off or writing down risky investments as the equivalent of selling (euro) 8 billion in new shares.
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