Deutsche Bank rises as clients and rivals show support

Shares in troubled Deutsche Bank rose as much as 3.5% yesterday after major clients and even rivals voiced support for the lender, fearing contagion after concern over its future last week sent the stock to a record low.

The German bank’s shares are 47% down in the year to date and hit a 30-year low late last week. Investors have lost trust in Deutsche Bank as hopes have faded for a swift deal with US authorities over a multibillion-dollar penalty.

The German bank is throwing its energies into reaching a settlement before next month’s US presidential election, with the US Department of Justice demanding a fine of up to $14bn (€12.5bn) for mis-selling mortgage-backed securities.

Chief executive John Cryan and finance head Marcus Schenck are travelling to the US to meet clients and staff and to attend the annual conference of the IMF.

While their programme has not been made public, a person close to the bank said it would be a surprise if Mr Cryan did not take the chance to meet regulators over Deutsche’s legal cases.

German finance minister Wolfgang Schaeuble is also scheduled to attend the IMF meeting and may use his visit to Washington, DC, to lobby for a favourable outcome for Deutsche Bank.

The German government has denied reports it has a rescue plan for the bank. Unconfirmed reports on Friday said Deutsche and the Department of Justice were close to agreeing a much lower penalty of $5.4bn.