IOB - IOB Delayed price. Currency in EUR
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Previous close7.79
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52-week range4.47 - 10.37
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  • Green Shoots Emerge in World Economy as Virus Lockdowns Ease

    Green Shoots Emerge in World Economy as Virus Lockdowns Ease

    (Bloomberg) -- Slowly but not surely, the world economy is emerging from its coronavirus-enforced hibernation.As governments ease lockdowns of businesses and allow consumers to travel and shop again, measures of high-frequency data and confidence increasingly suggest a bottom has been reached in the worst global recession since the Great Depression.A new set of daily activity gauges from Bloomberg Economics finds almost all of the economies it monitors witnessed a pick-up in activity since late March and early April, although no country is yet approaching its pre-virus levels. Germany, Japan and France are among those rebounding the fastest, while Spain and the U.K. remain relatively weak.A legacy of higher unemployment, bankruptcies and health fears also means recoveries are likely to be slow and sluggish after an initial bounce, with a full rebound unlikely before the discovery of a vaccine. The risk remains that the deadly virus could spike again, forcing constraints to be slapped back on.“The picture is generally getting better, but it is a slow crawl out,” Deutsche Bank Securities Chief Economist Torsten Slok told Bloomberg Television. “We are standing at the bottom of the canyon and looking up.”Policy makers are working to add momentum to the climb back with yet more economic stimulus. Japan on Wednesday announced more than $1 trillion of extra help for households and businesses, while the European Commission unveiled a package worth as much 750 billion euros ($825 billion) to help the continent’s worst-hit economies.Investors, for their part, are showing signs of confidence. European stocks rose on Thursday, and shares climbed in most of Asia as continued signs of economies reopening were weighed against the increase in Sino-American tensions over Hong Kong.In China, which was the original epicenter of the virus, the earliest indicators for May suggest its recovery is continuing. Official purchasing managers’ indexes should show the recovery making more headway, with the services sector probably continuing to rebound at a robust pace, according to Bloomberg Economics.China Manufacturing and Non-Manufacturing PMIsAsia’s policy makers continue to add stimulus to counter concerns in export-oriented economies that the blow to global demand will weigh on their outlooks. The Bank of Korea cut its key interest rate to a record low on Thursday.Among the trade engines in Asia, signs that manufacturing is improving haven’t yet been accompanied by a pickup in services. South Korea’s first 20-day export orders showed mild improvement in May, while still in double-digit decline, while export orders for Taiwan in April grew for a second month.Those figures from Korea and Taiwan are favorite early indicators for Shaun Roache, Asia-Pacific chief economist at S&P Global Ratings in Singapore. He says “global demand for tech is proving quite robust,” while services data “are still weak almost everywhere.”In India, where the world’s biggest lockdown threatens to push 12 million into extreme poverty, there may be glimmers of hope in high-frequency figures. A basket of such indicators, including traffic congestion, electricity demand, and employment, point to a “modest lift off lows,” Radhika Rao, an economist at DBS Group Holdings Ltd. in Singapore, said in a report Thursday.U.S. High Frequency Data DashboardIn the U.S., some green shoots are evident with most indicators on Bloomberg Economics latest weekly dashboard of high-frequency, alternative and market-based data showing slight but steady improvement from distressing levels. Those include filings for unemployment benefits, mortgage applications and travel by air and public transit. Air travel and table booking in restaurants are also picking up, albeit they are still far below their peaks.Some monthly data are also exhibiting signs of steadying or edging up. New-home sales in the U.S. unexpectedly increased in April, while consumer confidence as measured by the Conference Board stabilized in May after a sharp decline the previous month.“The U.S. economy appears set to turn the corner on the Covid-19 recession as businesses quickly reopen across the country,” said Mark Zandi, chief economist for Moody’s Analytics.At the end of last week, 575 counties, accounting for about 13% of the U.S. gross domestic product, were still locked down, according to Zandi. That’s down from a peak of 2,600 counties -- with nearly 30% of GDP -- at the end of April.“Maybe we’re near the bottom in terms of the economic downturn and hopefully we’ll start seeing improvement in coming months,” Federal Reserve Bank of New York President John Williams said in a May 27 Bloomberg Television interview. “I expect to see a pretty significant rebound in the second half of this year.”If the recovery does take hold in June, it would mark the U.S. downturn as perhaps the shortest recession in records going back to 1854, but among the most severe. The unemployment rate more than tripled in April to 14.7%, the highest since the Great Depression, as employers cut an unprecedented 20.5 million jobs. A further rise in joblessness is expected this month.“While the decline in confidence appears to have stopped for the moment, the uneven path to recovery and potential second wave are likely to keep a cloud of uncertainty hanging over consumers’ heads,” said Lynn Franco, senior director of economic indicators at The Conference Board.READ MORE: U.S. Economy Starts to Rise From AbyssAs for Europe, an easing of restrictions has also allowed a pickup in economies. Stores are reopening, as are restaurants in many countries, and high-frequency data measuring peoples’ movement to restaurant bookings show the start of a revival.Some measures of confidence and activity have also stabilized after plunging in the previous two months, helping to embed the idea that the euro-area economy is at the trough of the slump. German business expectations improved in May, and a regional measure of manufacturing and services activity jumped from a record low.On Thursday, the European Commission’s euro-wide sentiment index showed a small pickup in May.In the U.K., the country is moving into a key month in June. Schools will be allowed to restart, and there’s a timetable for stores to open their doors again after two brutal months. But it’s going to be cautious progress. The U.K. has overtaken Italy and Spain in terms of virus cases, and has the highest number of deaths in Europe.While Germany has already reopened restaurants, the U.K. may not do so until at least July. That’s captured in data from booking website OpenTable, which shows a bounce in German dining versus the U.K.Despite the emergence of activity, most economists have discarded the idea of a V-shaped recovery.Social distancing rules are still going to impinge on everything from how factories operate to consumers’ willingness to visit stores, car showrooms and bars. Many temporary job losses will prove permanent and debt-ridden companies will be forced to close for good.That leaves economists warning 2022 may be the earliest before economies recover the ground they have lost despite the euphoria in stocks.“There is divergence between Wall Street and Main Street,” Nouriel Roubini, a professor at NYU Stern School of Business, told Bloomberg Television. “The recovery is going to be anemic. Something like a U.”(Updates with markets, euro-area economic sentiment starting in seventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • China Isn’t Using Its Currency as a Cold War Weapon

    China Isn’t Using Its Currency as a Cold War Weapon

    (Bloomberg Opinion) -- The deterioration of U.S.-China relations is fast and furious, with Washington throwing out accusations of unfair trade practices, unlawful technology transfer and an early cover-up of the coronavirus outbreak, which has claimed over 100,000 American lives. The Chinese yuan, this year’s beacon of stability, is now is now at risk of tumbling like other emerging markets currencies.On Wednesday, the offshore yuan, which trades freely, flirted with its weakest level on record, dropping as much as 0.7% to 7.1965. While Thursday morning’s yuan fix came in stronger than expected, the overall sentiment is downbeat.It’s tempting to theorize that a weaker yuan could become a powerful weapon in the new Cold War, yet there’s little evidence of foul play from the People’s Bank of China. Since mid-2017, the central bank has based its fixing on the previous day’s close, dollar movement overnight against a currency basket, and what it calls the “countercyclical factor," a catch-all metric that grants wiggle room to deviate from market fundamentals. The yuan can move in a 2% trading range around the PBOC’s daily target.Take a look at Goldman Sachs Group Inc.'s estimate of the countercyclical factor. Over the last year, the PBOC has been consistently guiding its yuan stronger, not weaker, to artificially track the dollar. For all the theatrics of getting labeled a currency manipulator, Beijing wasn’t making its exports any cheaper.What’s new this year is the PBOC’s Zen-like attitude. Rather than playing the heroic fireman, handling one crisis after another, the central bank has been largely hands-off. It has used the countercyclical factor in a meaningful way only twice since January, on Feb. 4 when China emerged from the Lunar New Year holiday to face a national lockdown, and at the end of March when the outbreak was shaking up global markets.And why should the PBOC adhere to the dollar anyway? The coronavirus downturn has only showcased America’s exceptionalism — it prints the world’s reserve currency. Haven demand for the dollar has surged, evidenced by soaring currency swap rates from the euro zone to South Korea, and the Federal Reserve’s scramble to re-establish swap lines with other central banks. Looking back to 2008, the greenback only started to weaken two months after demand for “emergency dollars” peaked, data provided by Deutsche Bank AG show.So it makes sense for China to adopt a more enlightened approach, allowing the yuan to weaken during periods of dollar strength, and catch up when global tensions recede. From the PBOC’s view, the trade-weighted yuan is certainly stronger now than it was last fall, when the central bank was in fire-fighting mode. China doesn’t want to spend another $1 trillion of its foreign reserves defending its currency. The rapid drawdown in 2015 and 2016 traumatized the Chinese for good.To be sure, the pressure of capital outflows is still there. Just look at the consistent negative value of the “net error and omissions” figures in China’s balance of payment data. However, here’s the beauty of the virus: The Chinese can’t go anywhere. They can’t come to Hong Kong to buy insurance products, and unless you’re ultra-rich (with private bankers around the world apartment-hunting for you), Manhattan real estate is off-limits. The PBOC has less to worry about than before.So now the market can test the true value of the yuan. It could easily drop below 7.30 if the phase one trade deal breaks down and the Trump administration imposes some of the tariffs it had previously threatened, estimates HSBC Holdings Plc.Long-time China bear Kyle Bass abandoned his yuan short in early 2019 for the greenback-pegged Hong Kong dollar. He didn’t profit from his yuan trade because the PBOC established powerful tools, such as selling yuan-denominated bills in the offshore market, to kill anyone betting against the currency. Now that their interests are becoming aligned, it’s time for the bears to wake up.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Bloomberg

    SoftBank’s Vision Fund Is Planning to Cut 10% of Staff

    (Bloomberg) -- SoftBank Group Corp.’s Vision Fund is planning deep cuts in staffing after reporting about $18 billion in losses from the declining value of its startups, according to people familiar with the matter.The reductions could affect about 10% of the fund’s workforce of roughly 500, said two of the people, who asked not to be identified discussing personnel decisions. The Vision Fund’s headquarters are in London, with additional operations in Tokyo and California. The cuts will be across all levels of staff, said one person.A spokesman for the Vision Fund declined to comment.SoftBank founder Masayoshi Son and his $100 billion Vision Fund changed the tech industry by handing out enormous checks to relatively unproven startups. But the fund went from SoftBank’s main profit contributor a year ago to its biggest drag on earnings. It lost 1.9 trillion yen ($17.7 billion) last fiscal year after writing down the value of investments, including WeWork and Uber Technologies Inc.Son originally said he hoped to raise a new Vision Fund every two to three years, but he has conceded he can’t attract money now because of the poor performance. The fund, led by Rajeev Misra, operates as a SoftBank affiliate with most of the money coming from limited partners, led by Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala Investment Co.“It makes sense that SoftBank is cutting positions at the Vision Fund as they are in an extremely difficult situation, and they may start targeting highly paid workers to cut costs,” said Koji Hirai, head of M&A advisory firm Kachitas Corp. in Tokyo.The Vision Fund grew rapidly after launch three years ago as Misra recruited scores of people from the finance industry, including many of his former colleagues from Deutsche Bank. Among its managing partners are several of the German bank’s ex-employees, including Colin Fan, former co-head of its investment banking division.The fund also set up an unusual compensation structure that includes a $5 billion loan to employees. The debt is swapped for equity in the fund and generates profit when deals make money -- and losses when they don’t, scaled by seniority, people familiar with the matter have said. The poor performance so far, along with the layoffs, may prompt some employees to look for other positions.“One side effect is that the best people at SoftBank may exit to find better funds,” said Hirai. “If so, their fund business may become even worse, sliding down from a slope.”The Vision Fund has struggled since WeWork botched its efforts to go public last year and SoftBank stepped in to bail the company out. The Vision Fund currently manages more than 80 portfolio companies, but Son expects about 15 of the fund’s startups will likely go bankrupt while predicting another 15 will thrive.“Vision Fund’s results are not something to be proud of,” Son said earlier this month as he announced record losses. “If the results are bad, you can’t raise money from investors. Things aren’t good, that’s why we are investing with our own money.”The fund has already unwound some investments, including selling a nearly 50% stake in dog-walking startup Wag Labs back to the company last year. Son has said he plans to sell off about $42 billion in assets to finance stock buybacks and pay down debt.SoftBank disclosed it’s unloading some shares in Alibaba Group Holding Ltd. and is in talks to sell about $20 billion of T-Mobile US Inc., Bloomberg News reported. It’s also exploring a deal for its minority stake in industrial software maker OSIsoft LLC that could be worth $1.5 billion.SoftBank shares, after plummeting in March, have recovered and are little changed for the year. The stock rose just more than 1% in Tokyo trading.One emerging question is how Alibaba -- SoftBank’s most valuable holding -- will be affected by the clash between the U.S. and China. A bill just approved by the U.S. Senate could force Chinese companies like Alibaba to stop trading their shares on U.S. exchanges.“The big picture is SoftBank is caught up with U.S.-China conflict right now, and SoftBank may need to conduct a drastic restructuring if Alibaba was delisted from New York,” said Hirai. “Its main banks and the capital markets are anxiously awaiting an outcome for the situation.”(Updates with additional details starting in the first paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • CoCo Bond Investors Face a Covid-19 Reckoning

    CoCo Bond Investors Face a Covid-19 Reckoning

    (Bloomberg Opinion) -- The Covid-19 pandemic is even starting to affect the highly specialized world of bank capital.Lloyds Banking Group Plc, a large British lender, has just become the third European bank this year to do what was once unthinkable and decline to redeem an outstanding “CoCo” bond at its first call date. This form of hybrid debt — also known as additional tier 1 (or AT1) regulatory capital — is especially risky because the investor bears the losses if the bank fails, and it usually pays a generous interest rate.Because of their special status, there had always been a tacit understanding — though not a legal obligation — that investors would be able to cash in the bonds at the first redemption date, if they so chose, at least with European CoCos. But that tradition looks to be well and truly over among the stronger banks.Lloyds cited “extraordinary market challenges presented by Covid-19” as the reason to extend its own AT1s. With its dividend payments to equity holders suspended currently at the behest of the U.K. financial regulator, because of the coronavirus crisis, it would have looked rum indeed if the bank had cut its equity capital for the benefit of a small group of bondholders. This select bunch ought to have known the risk.The financial savings for Lloyds are just as relevant. By retaining the 6.375% 750 million-euro ($824 million) CoCo, it will switch to paying a floating coupon just above 5%. If it had redeemed the AT1 and issued a replacement bond, it would have had to offer a higher coupon to reflect the current market, probably one above 7%.Lloyds has a solid Tier 1 capital base of 16.9%, so in normal times it would have been expected to keep its bond investors happy. But regulatory pressure and the increase in yields on risky debt during the current crisis has forced even the better capitalized banks to prioritize their financing costs.Spain’s Banco Santander SA set the precedent last year of a blue-chip lender not redeeming its AT1 debt out of pure economic self-interest. That’s standard practice in the U.S. market, but Santander’s action caused a storm here in Europe. Germany’s Deutsche Bank AG and Aareal Bank AG have also skipped calls this year.This Americanization of the European CoCo market looks like a trend. ABN Amro Bank NV and Royal Bank of Scotland Group Plc both have AT1 bonds with calls due this summer, and Barclays Plc is due later in the year. They may follow the Lloyds example and retain cheap AT1 capital raised at lower yields.Banks have benefited hugely from AT1 issues as regulators count it as permanent equity (although it was almost always redeemed), meaning it counts toward capital buffers. And the cost is much lower for the issuer than true perpetual debt. Investors have been happy to play along as the yields far exceed those on bank debt with legally enforceable redemption dates.The Lloyds move is a wake-up call for AT1 investors.While the bigger banks’ CoCo bonds will probably still be popular, even if the call date is no longer guaranteed implicitly, the change might do more damage to weaker lenders. If investors no longer feel confident that their money will automatically be returned at the first redemption date, they’ll demand a higher return for the risk.The CoCo market only reopened tentatively this month with a new Bank of Ireland Group Plc deal. The Irish lender did what Lloyds refused to do and redeemed its existing AT1 and reissued at a higher cost. At least it managed to keep its investors happy and on board.This new separation between large stable banks being able to act according to their own economic advantage, while smaller rivals have to offer chunkier premiums, is a worry for the health of the financial system. It ought to be an urgent matter for consideration by European regulators. Forcing the strong banks to keep capital has consequences for their less illustrious peers.  This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Markets too optimistic about coronavirus recovery - Deutsche Bank CEO

    Markets too optimistic about coronavirus recovery - Deutsche Bank CEO

    Deutsche Bank chief executive Christian Sewing said on Tuesday that markets were too optimistic in their assessment of a recovery from the coronavirus crisis. It's a bearish statement from one of Europe's top bankers as key stock indexes have continue their climb from their lows in March. Sewing, speaking to investors attending an online conference, said that the real economic consequences of the crisis are still uncertain despite an ongoing market recovery.

  • Bloomberg

    Deutsche Bank CEO Says Trading Momentum Continued in May

    (Bloomberg) -- Christian Sewing has a bullish message for anyone doubting how his beleaguered Deutsche Bank AG will come through coronavirus crisis.The chief executive officer said on Tuesday that the positive momentum enjoyed by the big fixed-income trading unit in the first quarter carried over into April and May. At home, Deutsche Bank is benefiting as corporations who want access to the giant government aid package are turning to Germany’s biggest lender as their middleman. And despite the crisis, he has no intention of slowing down cost reductions.The comments sent shares of the lender higher, while raising the bar for the CEO to deliver when he presents second-quarter earnings. Sewing, speaking at the bank’s global financial services conference, said the crisis validates his decision to reduce risk, exit equities trading and focus on the businesses where Deutsche Bank has a leading position.Analysts, who have seen a succession of Deutsche Bank CEOs overpromising and underdelivering, so far don’t share his optimism. Not a single one forecasts Deutsche Bank to reach an 8% return of tangible equity in 2022, a target Sewing reiterated on Tuesday. Several have said that Deutsche Bank’s credit provisions in the first quarter may prove too low as peers in other countries put aside much higher amounts of money.Government ProgramSewing addressed those concerns, saying that the bank’s credit quality is strong compared with competitors, not least because of its conservative lending practices in the past and high exposure to Germany, where government aid has been particularly strong. Deutsche Bank’s credit provisions will likely continue to rise in the second quarter but still stay below those of the competition, he said.Sewing also said Deutsche Bank was on target or ahead of its restructuring program, and that he had no intention of letting the current environment derail it. One week ago, he resumed firings that he had suspended at the height of the crisis in March.Deutsche Bank shares extended gains, rising 6.2% at 4:25 p.m. in Frankfurt. The stock is the best performer this year among the large European lenders, adding 6% after years of declines.Sewing in July presented a sweeping restructuring plan to end half a decade of consecutive losses. He pulled the bank out of equities trading, promised to cut its headcount by 18,000, and fix its deficient controls. Fixed-income trading is expected to deliver a sizable chunk of the growth planned for the bank as negative interest rates continue to erode income from lending.The trading unit posted a 13% gain in revenue in the first quarter, as unprecedented volatility led to trading bonanzas across Wall Street. The increase was less than the average at U.S. competitors.(Updates with comments on loan-loss provisions from fifth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Why the Fed Just Reprimanded Deutsche Bank and What It Means Going Forward
    Motley Fool

    Why the Fed Just Reprimanded Deutsche Bank and What It Means Going Forward

    News outlets are reporting that Germany's largest bank still has not corrected its internal controls related to anti-money laundering.

  • Business Wire

    Deutsche Bank AG Announces Automatic Acceleration of DB Crude Oil Double Short Exchange Traded Notes due June 1, 2038 (DTO)

    Deutsche Bank announced today the automatic acceleration of the DB Crude Oil Double Short Exchange Traded Notes due June 1, 2038 (DTO), due to the repurchase value on May 18, 2020 being zero.

  • Reuters - UK Focus

    Lobby calls on EU for extra capital easing to help banks lend more

    A banking lobby group called on Tuesday for the European Union to further soften a capital measure to ensure banks do not run out of headroom to help companies hit by the coronavirus crisis. The Association for Financial Markets in Europe (AFME) said the European Central Bank (ECB) has estimated that such measures will free up 120 billion euros ($131 billion) to support 1.8 trillion euros of additional lending. "The question is are these changes going to be sufficient to furnish banks with enough capacity to provide the support to their customers that is going to be needed in the coming downturn, let alone the recovery?" Michael Lever, head of prudential regulation at AFME, said in a blog post.

  • Deutsche Bank completes milestone in internal bank merger - Deputy CEO

    Deutsche Bank completes milestone in internal bank merger - Deputy CEO

    Deutsche Bank over the weekend completed a milestone in the merger of its private and business clients subsidiary in Germany with the mother ship, the lender's deputy chief executive said on Monday. The step is a sign of business-as-usual and progress in the bank's restructuring at a time that the coronavirus outbreak is wreaking havoc on the global economy, disrupting operations and forcing large swathes of staff to work from home. Karl von Rohr, Deutsche's deputy, told Reuters that the bank has transferred 41,000 assets over recent weeks and adapted hundreds of documents, an effort that involved more than 600 employees.

  • $277 Billion Package May Not Give Immediate Boost to India

    $277 Billion Package May Not Give Immediate Boost to India

    (Bloomberg) -- India’s 21 trillion rupee ($277 billion) virus-relief package fell short of economists’ expectations, providing fiscal measures that will help improve growth over the years without delivering an immediate boost to an economy that desperately needs it.Analysts have been pouring over the details provided by Finance Minister Nirmala Sitharaman over the past five days, and the conclusion of many is that the additional spending boost is far less than the 10% of gross domestic product that the headline number suggests. HSBC Holdings Plc estimates a fiscal cost of just 1% of gross domestic product.“Markets were expecting a more immediate demand-side stimulus,” HSBC economists led by Pranjul Bhandari, wrote in a note. “True that some measures to remove immediate distress are contained within the package. However, a large part of the attention has been towards medium-term supply-side measures.”​​The rupee fell the most in Asia on Monday, tracking stocks as investors discounted the rescue plan. The currency declined as much as 0.5% to 75.97 per U.S. dollar in a third day of declines. The S&P BSE Sensex of stocks slid 2.6% at 2:35 p.m. in Mumbai.Some of the key measures outlined by Sitharaman include: loan guarantees for small businesses, cheap credit to workers and farmers, tax breaks for service providers, increased foreign direct investment in defense manufacturing and a suspension of new insolvency proceedings for up to a year.Here’s a look at what economists are saying about the support package:How much of this money is new spending?Much of the economic package includes measures already budgeted by the government and the central bank.“Only about 10% of this stimulus can be traced as direct additional budgetary cost to the central exchequer,” said D.K. Srivastava, chief policy adviser at EY India. “Nearly 5% of the stimulus relates to already budgeted expenditures.”Rahul Bajoria, an economist at Barclays Plc in Mumbai, said the measures include 8 trillion rupees of support already announced by the Reserve Bank of India. He estimates the actual fiscal impact on the budget will be only 1.5 trillion rupees, or 0.75% of GDP.What kind of a boost will the package provide?The main focus of the government’s measures is providing a $72 billion liquidity boost for small businesses, shadow banks and electricity distributors, as well as loan support for farmers. Small businesses are the bedrock of the $2.7 trillion economy, employing more than 110 million people.Loan support helps to cushion the blow for businesses but won’t boost consumer spending, a dilemma that many countries around the world are facing as job losses mount. The spending and reform measures proposed by India’s government are more geared to improve supply-side bottlenecks and support economic growth in the medium- to long-term. It doesn’t provide citizens with a cash boost to spend.“Providing financial support to keep units alive is good,” said Pronab Sen, program director with International Growth Centre and a former chief statistician of India. “That’s necessary to begin with but that’s only step one. Step two is demand support. If this is all they are going to give the demand support will not exist.”What does this mean for economic growth?India’s services industries, which make up more than half of GDP, weren’t specifically targeted in the government’s relief package. Businesses from airlines to hotels to entertainment centers will continue to struggle despite the financial support measures outlined.“The fiscal packages announced so far have stayed clear of sector-specific announcements that target the more vulnerable sectors, such as travel, tourism, hotels and restaurants,” Sonal Varma and Aurodeep Nandi, economists at Nomura Holdings Inc., wrote in a note.Goldman Sachs Group Inc. economists said the structural reform measures announced by the government are more medium-term in nature and won’t result in an immediate boost to growth. They see GDP contracting 5% in the fiscal year through March 2021, which would be India’s deepest recession ever.Read More: Goldman Sees Worst India Recession With 45% Second Quarter SlumpWhat happens next?A nationwide lockdown was extended for a third time through May 31, with some incremental easing of curbs to allow economic activity to resume. Companies are facing difficulties reopening factories though -- primarily because of travel restrictions, conflicting rules, broken supply chains and a shortage of workers.With the fiscal package out of the way, the focus will once again shift to the central bank to provide support. The six-member monetary policy committee will likely cut interest rates again in early June. It’s already lowered rates by 75 basis points this year and injected billions of dollars into the financial system through money market operations.“Given the extension of the lockdown, the RBI, in our view, should cut the repo and reverse repo rate by 75 basis points in the upcoming June policy or at least cut the reverse repo rate by 75 basis points while cutting the repo rate by 50 basis points,” said Kaushik Das, an economist at Deutsche Bank AG in Mumbai.(Updates with comments from economists in third and last paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Deutsche Bank Sets Target for Sustainable Investment by 2025

    Deutsche Bank Sets Target for Sustainable Investment by 2025

    Deutsche Bank's (DB) plans to launch its first-ever green bond is reflective of its efforts to meet investors' expectations, regarding the ESG space.

  • Deutsche Bank weighs sale of online bank Norisbank - source

    Deutsche Bank weighs sale of online bank Norisbank - source

    Deutsche Bank is weighing the sale of its German online bank Norisbank, a person with knowledge of the matter said on Thursday. Deutsche Bank is in the midst of an overhaul that includes streamlining operations, exiting some business lines and shedding 18,000 staff. Deutsche Bank acquired it in 2006 for 420 million euros(371.65 million pounds) from DZ Bank.

  • Deutsche Bank criticised in internal N.Y. Fed audit - German newspaper

    Deutsche Bank criticised in internal N.Y. Fed audit - German newspaper

    Deutsche Bank's regulators in the United States have criticised the German lender in an internal audit for weaknesses in fighting money laundering and in risk management, according to a German newspaper on Wednesday. The Sueddeutsche Zeitung said the bank has 90 days to respond to the audit, which was sent to Deutsche management at the end of March. Deutsche Bank declined to comment and the Federal Reserve Bank of New York didn't immediately respond to a request for comment.

  • Jersey jackpot of $2 million awaits Deutsche's lost shareholders

    Jersey jackpot of $2 million awaits Deutsche's lost shareholders

    While Deutsche Bank employees fret about their jobs and pay, Germany's largest lender is trying to track down several hundred former staff to claim share payouts it has been holding in Jersey. The assets, which are in the form of stock as well as accrued dividends, have been held for years by the outpost, which was the central depository for awards for Deutsche Bank employees globally, excluding those in Germany and the United States. Jersey court documents show that over the past year Deutsche Bank has used resources including LinkedIn, 192.com, Google, and the investigative group Kroll to hunt down the ex-staffers.

  • Deutsche Bank targets 200 billion euros of sustainable investment by 2025

    Deutsche Bank targets 200 billion euros of sustainable investment by 2025

    German lender Deutsche Bank plans to pump at least 200 billion euros ($216.8 billion) into so-called sustainable financing and investments by 2025, its first formal targets for doing so. The money will include loans provided by the bank, bonds placed on behalf of its clients and assets managed by its private bank. The move is the latest by a leading global lender to showcase commitment to sustainable investing, as pressure builds on banks to support the globally agreed transition to a low-carbon and more environmentally friendly economy.

  • Deutsche Bank top managers to forego some pay to cut costs

    Deutsche Bank top managers to forego some pay to cut costs

    Deutsche Bank's top managers will waive one month of fixed pay in an effort to cut costs as Germany's largest lender deals with the fall-out of the coronavirus crisis. Members of the management board as well as the bank's group management committee will be affected by the move, chief executive Christian Sewing will tell shareholders at next week's annual general meeting, according to a text of the speech published on Tuesday. "In this phase of upheaval we have to make our bank even more weatherproof - or, to be more precise, stormproof," Sewing said.

  • Pimco Is Managing to Do More With Less

    Pimco Is Managing to Do More With Less

    (Bloomberg Opinion) -- The year started well for Pacific Investment Management Co., the fixed-income asset manager owned by German insurer Allianz SE. After pulling in 83 billion euros ($90 billion) of fresh cash from investors in 2019, the firm continued to attract new money in January and February. Then the global pandemic struck. Investor withdrawals equaled almost half of last year’s inflows, leaving Pimco with net outflows of 43 billion euros in the first quarter.Exhibiting masterly understatement, Chief Financial Officer Giulio Terzariol told Bloomberg Television, “March was a tough month.” Retail investors abandoned the market as the novel coronavirus threatened to trash the global economy.Beneath the headline decline in assets under management — Pimco’s worst drop in the five years since the surprise departure of bond maestro Bill Gross, as noted by my Bloomberg News colleagues — the firm’s recovery continues apace. That means Allianz will be dealing from a position of strength if it finally takes the plunge and decides to expand its asset-management business by buying a rival player. In the current beleaguered environment, the one variable that asset managers are able to control is their costs. As Pimco’s overall revenue grew by 18.4% in the year, to more than 1.3 billion euros, the firm was able to shave almost a percentage point from its cost-to-income ratio, extending a trend of parsimony that’s been in place for at least the past five years.Moreover, the margin Pimco is able to charge for managing other people’s money has been remarkably stable, particularly given the fee compression that the rest of the active management industry has endured amid increased competition from low-cost index-tracking products. While its first-quarter margin of 37.3 basis points was down a tad from December, it actually improved from 36.1 basis points in the year-earlier period.A year ago, Pimco’s parent toyed with the idea of buying DWS Group GmbH, when Deutsche Bank AG was mulling offloading its remaining 80% stake in the fund manager as part of its ultimately doomed attempt to merge with Commerzbank AG.In the end, neither transaction happened. But Allianz has given notice that it intends to be part of any industry consolidation. At some point, the German insurer might want to bolster its fund-management defenses against the rise of the index trackers by buying a specialist in passive strategies. With a market share of more than a quarter of Europe’s exchange-traded products, DWS may still prove attractive — if it ever comes up for sale.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • U.S. Infections Rise 1.3%; Trump Touts Testing: Virus Update

    U.S. Infections Rise 1.3%; Trump Touts Testing: Virus Update

    (Bloomberg) -- President Donald Trump said that “we have prevailed” as U.S. deaths from the coronavirus exceeded 80,000 -- a remark he later said pertained only to testing for the infection. The White House ordered staff to wear a face mask after Vice President Mike Pence’s press secretary tested positive for the virus last week.New York state will begin to reopen in some regions on Friday, though New York City, the U.S. epicenter of the outbreak, will likely see its lockdown extended into June. Wuhan, where the epidemic began, reported its first new infections since the Chinese city ended its lockdown last month.Russia reported a record number of new cases in one day as it emerged as a new hub of the outbreak in Europe, though the spread slowed elsewhere on the continent. France, Switzerland and Greece are loosening restrictions. The U.K. outlined a plan to ease the country’s lockdown in phases, as its premier urged Britons to prepare for a new normal.Key Developments:Virus Tracker: Cases top 4.1 million; deaths exceed 284,000NYC had 24,172 excess deaths as outbreak acceleratedInfections near meat plants twice U.S. rate after Trump orderSleuthing at funeral parlors to track nursing homes’ tollWhat we don’t know about coronavirus origins might kill usEurope faces more slog than snapback in economySubscribe to a daily update on the virus from Bloomberg’s Prognosis team here. Click VRUS on the terminal for news and data on the coronavirus. See this week’s top stories from QuickTake here.Trump Says ‘We Have Prevailed’ (5:30 p.m. NY)President Donald Trump declared at a White House news conference on the coronavirus outbreak that “we have prevailed,” as U.S. deaths from the disease exceeded 80,000 -- a remark he later said pertained only to testing for the infection.“Thanks to the courage of our citizens and our aggressive strategy, hundreds of thousands of lives have been saved,” Trump said. “In every generation, through every challenge and hardship and danger, America has risen to the task, we have met the moment and we have prevailed.”Asked later about his remark that the U.S. had “prevailed,” Trump said he was only talking about testing for the virus. The U.S. didn’t exceed 100,000 coronavirus tests performed until March 19, according to data compiled by the Covid Tracking Project, but more than 300,000 tests were conducted daily on Thursday, Friday and Saturday.White House Orders Staff to Wear Masks (4:40 p.m. NY)The White House ordered everyone entering the West Wing to wear a face mask after Vice President Mike Pence’s press secretary tested positive for the coronavirus last week. The announcement was made in a memo addressed to staff on Monday, according to two people, and said employees didn’t need face coverings while working at their desks.“Staff who sit in the West Wing are not required to wear a facial covering while at their desk if they are appropriately socially distanced from their colleagues,” the memo from the White House Management Office reads.“Unless you absolutely need to conduct in-person business in the West Wing, we respectfully ask you to avoid unnecessary visits,” it added.U.S. to Distribute $11 Billion in Test Funding (4:30 p.m. NY)The Trump administration plans to distribute $11 billion to states for coronavirus testing, according to senior administration officials.The $11 billion is part of the CARES Act stimulus package. It will be distributed under a formula that reflects the burden of Covid-19 as well as population-based estimates, the officials said. The administration plans to release details about the distribution in the next day or two, the officials said.Western States Ask Congress for $1 Trillion in Aid (4:05 p.m. NY)Five Western states have sent a letter to Congress asking for $1 trillion in “direct and flexible relief” for local and state governments trying to recover from the coronavirus outbreak.The letter, which was addressed to congressional leadership including House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell, was signed by the governors of the Western States Pact -- a group of states that has banded together to organize their Covid-19 response.California Governor Gavin Newsom announced the letter during his daily press briefing Monday, and it was also signed by the governors of Oregon, Colorado, Nevada and Washington. They are seeking the funding for all 50 states.“This aid would preserve core government services like public health, public safety, public education and help people get back to work,” the letter reads. “Red and blue states alike all are faced with the same Covid-19 math.”U.S. Confirmed Cases Rise 1.3% (4 p.m. NY)U.S. cases rose 1.3% from the day before to 1.34 million, according to data compiled by Johns Hopkins University and Bloomberg News. That was down from Sunday’s growth rate of 1.8% and the lowest daily increase since April 30.New York added 1,660 cases on Sunday, the smallest number since mid-March, and 161 additional deaths, the lowest since late March.Florida reported 40,982 cases, up 1% from a day earlier, according to the state’s health department. Deaths reached 1,735, an increase of 0.8%.California’s cases rose 1.9% to 67,939 while deaths rose 0.9% to 2,770, according to the state’s website.Ontario Cases Fall as Quebec Struggles (3:55 p.m. NY)Ontario reported the lowest number of new cases in six weeks as Canada’s most populous province gradually reopens. Curbside retail, hardware stores and some construction projects have been allowed to restart business. The province expects to announce a plan next week for schools, which have been closed since mid-March, Doug Ford, the province’s premier, said.Meanwhile in Quebec, Premier Francois Legault said the situation in Montreal remains concerning. As schools and shops open in the rest of the province, residents and businesses of Canada’s second-largest city are scheduled to continue under tighter restrictions until May 25.Twitter to Tag Misleading Virus Posts (1:55 p.m. NY)Twitter Inc. will label some misinformation that’s confusing or misleading, increasing the likelihood that more Covid-19 tweets will be marked or taken down. Previously, Twitter reserved that for posts posing a direct threat to safety. The new label will apply to tweets that are “less severe” but “where people may still be confused or misled,” the company said in a blog post.Twitter, like Facebook Inc., has been trying to curb the spread of incorrect data and misleading material, relying on public health authorities to determine what may be misleading.N.Y. to Start Some Reopenings Friday (1:04 p.m. NY)Certain businesses in New York state -- including construction, curbside retail, drive-in movie theaters and some recreational activities -- will reopen this week on a regional basis, Governor Andrew Cuomo said. Each area will have to meet seven criteria, including low rates of virus-related hospitalizations and having certain testing and tracing measures in place. There will be control rooms to monitor each area’s reopening, ensuring they meet the metrics, the governor said in his daily briefing.Cuomo has said that it would be a “miracle” if hard-hit New York City were ready to reopen on May 15. Earlier today, Mayor Bill de Blasio said the city’s lockdown is likely to continue into June.Risk of Transmission Will Rise Again: WHO (1 p.m. NY)As countries ease restrictions and people mix more, the risk of transmission will rise again, said Mike Ryan, head of the World Health Organization’s health emergencies program. The question is whether countries can identify and isolate clusters of cases so the transmission doesn’t reach previous rates, he said.“Shutting your eyes and trying to drive through this blind is about as silly an equation I’ve seen,” Ryan said. “I’m really concerned that certain countries are setting themselves up for some seriously blind driving over the next few months.”Ryan also said the idea that countries with lax measures will “all of a sudden magically reach some herd immunity” is a “really dangerous calculation” as it would involve many deaths.“People are growing tired, we understand, but we need to have people stay with us,” said Maria Van Kerkhove, the WHO’s technical lead on Covid-19.Italy Sees Fewest Cases Since March 4 (12:19 p.m. NY)Italy registered 744 new cases, the lowest number since March 4, on Monday, as Prime Minister Giuseppe Conte struggles to finalize a 55 billion-euro ($59 billion) stimulus package to rescue an economy stricken by the lockdown. Confirmed cases total 219,814. Daily fatalities rose to 179 from 165 on Sunday, with a total of 30,739 reported since the start of the pandemic in late February. The number of patients in intensive care fell to 999, marking the first time in two months it’s fallen below 1,000.Florida Cases Rise 1% as Reopening Expands (12:07 p.m. NY)Florida reported 40,982 Covid-19 cases on Monday, up 1% from a day earlier. Deaths among Florida residents reached 1,735, an increase of 0.8%.Florida allowed salons and barber shops to reopen Monday in most parts of the state, a week after retailers and restaurants were permitted to start back up. Florida’s three most populous counties were initially held back from the first phase of reopening, but one of them -- Palm Beach County -- started up again Monday. Miami-Dade and Broward are expected to follow on May 18.NYC Likely in Lockdown Into June (11:13 a.m. NY)New York City’s lockdown is likely to continue into June, Mayor Bill de Blasio said. While some parts of the state, which has been under lockdown since March, will be able to reopen from Friday, the city hasn’t made enough progress in cutting down on new cases, even as hospital and intensive-care admissions fall.“June is when we’re potentially going to make changes if we make real progress,” the mayor said at his daily briefing Monday. “We have to keep bringing it back to the science and the data.”De Blasio also said health officials will turn to dozens of small private neighborhood medical practices to aid in testing, contact tracing and outpatient care.Clinics throughout the city will be provided with protective gear, including 120,000 surgical masks per week, and 150 will receive training to offer remote care through telemedicine, de Blasio said. The practices will also have access to hotels to isolate patients who live in crowded households, he said.Extra HIV Deaths Foreseen Amid Drug Shortages (9:50 am NY)The World Health Organization and UNAIDS estimated that a six-month disruption of supplies of antiretroviral therapies could lead to 500,000 extra deaths from HIV in sub-Saharan Africa if countries don’t take action. That’s more than the total number of deaths from HIV in the region in 2018. About 25.7 million people live with HIV in that area, where supplies may be disrupted because HIV services are closed or because of shortages. Some antiretrovirals are being used to treat Covid-19.“The Covid-19 pandemic must not be an excuse to divert investment from HIV,” Winnie Byanyima, executive director of UNAIDS, said in a statement.Putin Ends National Stay-at-Home Period (9:35 a.m. NY)Russian President Vladimir Putin ended his national stay-at-home period after six weeks, putting the responsibility for restrictive measures on regional leaders, even as the number of infections surged past most European countries.The number of confirmed cases in Russia rose by 5.6% to 221,344 on Monday, surpassing Italy, France and the U.K. Russia has been recording more than 10,000 new cases a day for more than a week, but the growth has been slowing. Total fatalities rose to 2,009 after 94 more people died.Gilead’s Drug Seen in Short Supply (9:20 a.m. NY)The U.S. will get less than half of Gilead Sciences’ worldwide donation of 1.5 million vials of its Covid-19 medicine over the next six weeks, which isn’t expected to be enough to treat all the patients who would qualify for it.Gilead is donating about 607,000 vials of its remdesivir in the U.S. during that time frame. That’s enough to treat 78,000 hospitalized patients, according to the Department of Health and Human Services. Health officials authorized emergency use of the treatment earlier this month.Wear Face Masks for Long Haul: U.K.’s Johnson (9 a.m. NY)Britons should wear face coverings in enclosed spaces and prepare for a different kind of normal that may last for a year or more, Boris Johnson’s government said as he published a road map for the national recovery from coronavirus.Johnson said social-distancing measures are likely to be needed for the foreseeable future, with people continuing to work from home where they can, until a vaccine or drug treatment can be found. The government aims to allow shops to reopen next month and pubs after July 4.Among the options under consideration is the idea of allowing households to mix, potentially forming “bubbles” with another household. That would allow two households to share childcare, helping parents go back to work, the document said.U.K. jury trials will resume as soon as May 18, Ian Burnett, the Lord Chief Justice of England and Wales, said Monday in a separate statement. The new trials will still have 12 jurors and use social distancing and other measures to ensure safety.Deaths in the U.K. rose by 210 to 32,065, after an increase of 269 the day before.Wuhan Sees First New Cases Since Lockdown (8:18 a.m. NY)Wuhan reported the first new cases since ending its 76-day lockdown on April 8. The six locally transmitted cases, reported on May 9 and 10, were found in people already under quarantine who were asymptomatic before testing positive, according to the local government. Although the new cases are few and appear under control, they serve as a reminder of the risks China faces as it tries to reopen an economy that has seen its worst contraction since 1992.Marriott Demand Slumps, Coty-KKR in Deal (7:35 a.m. NY)Marriott International Inc. saw its business crater in April, with travel virtually shut down around the world. Revenue per available room, a measure of occupancy and pricing, decreased 90% in April, a sign that the company faces a tough road to recovery from the pandemic.Continental Resources Inc., the oil producer founded by billionaire Harold Hamm, is curtailing 70% of its operated output in May. Under Armour plans to reduce its planned operating expenses by about $325 million by reducing bonus compensation for some employees, temporary layoffs and limiting additional spending. However, AutoNation, the biggest car dealership chain in the U.S., said car sales have already started to pick up in the end of April as shutdown orders eased.Coty Inc. shares surged after the cosmetics company agreed to sell beauty and hair-care brands including Wella to KKR & Co. in a deal that will also include an investment in the cosmetics company by the buyout firm. Sales in the quarter slumped 23%.Commerzbank AG abandoned its planned sale of Polish subsidiary mBank SA, saying the coronavirus outbreak has made it impossible to attract a worthwhile offer.India May Allow Some Domestic Flights (6:58 a.m. NY)India is considering allowing some domestic flights to resume on May 18 or earlier as the government looks to reopen a key part of the economy and provide relief to airlines, which haven’t been able to fly since March because of a nationwide lockdown, according to people familiar with the matter.The Ministry of Civil Aviation is in talks with airlines, travel agents and the federal home ministry about the move, the people said, asking not to be identified because the deliberations aren’t public. A decision may come Monday, they said, adding that Prime Minister Narendra Modi is meeting with state chief ministers this afternoon.Macy’s Attracts Billionaire Investors (6:54 a.m. NY)Macy’s Inc., one of the U.S. retailers struggling as the pandemic crimps demand, attracted Czech billionaire Daniel Kretinsky, whose investment vehicle bought a stake to engage in “constructive discussions” with management. Macy’s is seeking additional sources of financing to meet its obligations as many of its brick-and-mortar stores remain closed.Vesa Equity, the investment vehicle for Kretinsky and partner Patrik Tkac, amassed a 5% stake in Macy’s, according to a securities filing. The purchase makes it one of the company’s top five shareholders, according to Bloomberg data.Deutsche Bank Offers Bond to Bolster Capital (6:24 a.m. NY)Deutsche Bank AG is offering a subordinated bond to boost its capital ratio as the bank girds itself for the deepest recession in almost a century. The bond, known as Tier 2, “will increase Deutsche Bank’s total capital ratio” and “improve its buffer versus regulatory capital requirements,” the lender said.Chief Executive Officer Christian Sewing recently said that increased lending and higher credit provisions due to the coronavirus will cause the bank’s capital buffers to temporarily fall below the minimum threshold he set. Germany’s largest lender was already dipping into its capital reserve before the crisis to pay for the deep restructuring that the CEO revealed last summer.New Virus Cases in Indonesia Rise (6:13 a.m. NY)The death toll from the coronavirus outbreak in Indonesia neared 1,000 as more cases were confirmed across the archipelago, with President Joko Widodo expressing disappointment over the slow progress in expanding testing for the disease. Eighteen people succumbed to the virus in the past 24 hours, taking the total to 991. The total number of positive cases rose by 233 to 14,265.With the pandemic showing no signs of slowing, Jokowi, as Widodo is known, called for scaling up the nation’s diagnostic capacity, saying the daily testing of 4,000-5,000 specimens was “far below our target.”(A previous version corrected the average weekly increase in U.S. cases.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Deutsche Bank Sells Bond to Boost Capital as Recession Looms

    Deutsche Bank Sells Bond to Boost Capital as Recession Looms

    (Bloomberg) -- Deutsche Bank AG is offering a subordinated bond to boost its capital ratio as the bank girds itself for the deepest recession in almost a century.The euro-denominated bond, known as Tier 2, “will increase Deutsche Bank’s total capital ratio” and “improve its buffer versus regulatory capital requirements,” the lender said in a statement on Monday.Chief Executive Officer Christian Sewing recently said that increased lending and higher credit provisions due to the coronavirus will cause the bank’s capital buffers to temporarily fall below the minimum threshold he set. Germany’s largest lender was already dipping into its capital reserve before the crisis to pay for the deep restructuring that the CEO revealed last summer.European and national regulators have granted banks more flexibility in how they can meet certain capital requirements to help keep lending flowing to businesses struggling amid the crisis.“We’re issuing now because the market environment is supportive,” said Dixit Joshi, Deutsche Bank’s group treasurer. “The issue will also help to support business growth and our clients.”The lender will sell 1.25 billion euros ($1.4 billion) of Tier 2 notes at 600 basis points above benchmark midswap rates, according to a person with knowledge of the sale, who asked not to be identified as they’re not authorized to speak about it.Deutsche Bank also launched a tender for 2 billion euros in outstanding bonds to “provide liquidity” to investors, Joshi said. If successful, the deal may also boost quarterly earnings as the current valuation likely means Deutsche Bank could buy the securities below the price the lender has used to account for them on its balance sheet, potentially providing an accounting benefit.The new bond won’t affect the bank’s common equity tier 1 ratio, a key measure of financial strength. However it will widen the gap between its total capital ratio and a regulatory requirement known as maximum distributable amount, which determines whether coupons on Additional Tier 1 notes can be paid. The requirement is 15.04% and the bank had a 16.59% ratio at the end of the first quarter.Bond issuance conditions have improved significantly since the coronavirus crisis shuttered primary markets in February. The average spread on euro Tier 2 bonds is more than 100 basis points tighter than it was in late March, according to a Bloomberg Barclays index. Royal Bank of Scotland Group Plc last week became the first European lender to sell Tier 2 debt for nearly three months.Deutsche Bank’s bond makes use of a recent regulatory change that now allows banks to use more subordinated debt to meet regulatory requirements, helping them to cut costs. The change makes it likely that other banks will sell more subordinated bonds, whether Tier 2 or riskier Additional Tier 1s, said Tom Kinmonth, a fixed income strategist at ABN Amro.Banks who aren’t “in a super-comfortable situation” with their capital buffers are particularly likely to use the new flexibility provided by the regulator, said Andreas Meyer, who helps manage more than 3 billion euros including bank bonds at Aramea Asset Management in Hamburg.(Updates with bond details in sixth paragraph, tender in seventh paragraph and more details on market conditions in tenth and eleventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • I've Seen Trump's Tax Returns and You Should, Too

    I've Seen Trump's Tax Returns and You Should, Too

    (Bloomberg Opinion) -- President Donald Trump took to Twitter early Sunday morning, elated: “So great to see our Country starting to open up again!”He shared that sentiment with nearly 80 million followers and attached it to a tweet from one of his golf clubs, Trump National, in Rancho Palos Verdes, California. “Game on! We are thrilled to announce the reopening of @trumpgolfla beginning Saturday May 9th!,” the club tweeted. “We look forward to welcoming you back. Book your tee time now!”Sometimes a tweet is just a tweet. And sometimes it’s an advertisement for your business. And sometimes, when the president of the United States promotes his business on Twitter while overseeing the federal response to a pandemic gutting the economy, it’s a financial conflict of interest.Is Trump pushing businesses to reopen despite ongoing perils attached to the coronavirus because it’s best for the country? Or is it because Covid-19 has battered his family’s fortunes? Or is it simply because he has the upcoming presidential election in mind? Who knows. But we are more than three years into this presidency and the same questions that have hung over Trump from the moment he launched his bid for the White House still linger: What are the contours of his personal finances and how do they inform his actions and policies?On Tuesday, the Supreme Court will help shape our understanding of some of this when it hears arguments involving efforts by Congress and a New York prosecutor to get access to Trump’s tax returns, bank documents and bookkeeping records. Trump’s lawyers and the Justice Department contend that the president shouldn’t have to comply with subpoenas — or can block his financial advisers from complying — because the requests are overly intrusive or undermine the sweeping immunity from criminal investigations he should enjoy while in office.Congress says it wants Trump’s tax returns so it can craft legislation modernizing federal ethics and disclosure laws and protecting the 2020 election from foreign interference. Manhattan District Attorney Cyrus Vance Jr. is conducting a probe into the Trump Organization’s efforts to mask hush money paid to two women who said they had sexual encounters with Trump. He wants to explore whether Trump’s team falsified business records as part of those maneuvers.While the Supreme Court’s decision will likely touch on crucial Constitutional matters such as the separation of powers and the legislative branch’s ability to monitor the executive branch, the animating force guiding the court in this matter may be even more basic: whether or not any president is above the rule of law. If the court’s decision pivots off of that, then you’d do well to read George Conway’s recent op-ed in the Washington Post. “The Constitution is concerned with protecting the presidency, not the person who happens to be the president,” Conway writes. “That’s because no one in this country is above the law.”The Constitution also makes it clear that presidents can’t use the most powerful office in the land to line their wallets. Articles I and II forbid presidents from accepting what the 18th century called “emoluments” and what the 21st century calls “bribes” from foreign or domestic sources. The Constitution’s ban on emoluments in and of itself requires presidents to be transparent about their finances and circumspect about their business dealings.While federal conflict-of-interest laws dating from the Civil War era and updated in 1978 in the wake of the Watergate scandal also require presidents to disclose assets and business interests – and to have potential conflicts monitored by a federal ethics watchdog — much of the disclosure remains voluntary. Presidents remain exempt from federal conflict-of-interest statutes, so practices like placing assets in a blind trust (which Lyndon B. Johnson, Jimmy Carter, Ronald Reagan, both of the Bushes and Bill Clinton did) or releasing personal income tax returns (which every president since Carter has done) is essentially voluntary. Financial transparency in the White House is a tradition but not a requirement.Trump chose to buck tradition, of course. He hasn’t released his tax returns and the trust controlling his business interests is anything but blind — it’s overseen by his two eldest sons and his longtime accountant. Litigants typically aren’t hesitant to release information or documents that reflect well on themselves, so the natural question arising from Trump’s stonewalling in the matters the Supreme Court will hear is, “What’s he hiding?”Trump sued me for libel in 2006 for a biography I wrote, “TrumpNation,” claiming the book unfairly and intentionally misrepresented his track record as a businessman and lowballed the size of his fortune. The suit was dismissed in 2011.During the course of the litigation, Trump resisted releasing his tax returns and other financial records. My lawyers got the returns, and while I can’t disclose specifics, I imagine that Trump is hesitant to release them now because they would reveal how robust his businesses actually are and shine a light on some of his foreign sources of income.Deutsche Bank AG, one of the firms Trump’s lawyers are trying to stifle in their arguments before the Supreme Court, also turned over documents in my case — including its own assessment of Trump’s wealth that pegged his fortune at $788 million in 2004, well below the $3 billion he told them he had at the time. Deutsche is the only major global bank to have continued doing business with Trump since the early 1990s and is conversant with his financial comings and goings since then.Mazars USA is Trump’s outside accounting firm. Trump’s lawyers will argue before the Supreme Court that it too shouldn’t comply with subpoena requests for documents. Mazars, which boasts a history ProPublica recently described as “colorful,” turned over documents in my litigation with Trump as well (through a predecessor company with which Mazars later merged). That trove included a financial statement Trump routinely used to substantiate his claims to fabulous wealth. The document, it turned out, was drafted without regard for standard accounting practices or other factors that might have diminished the future president’s claims.If all of this information from Trump’s taxes, bankers and accountants was good enough for me over a decade ago, it’s certainly good enough for Congress and the Manhattan district attorney today. It’s also good enough for the American people. If we’ve learned one thing from the Trump presidency it’s that it’s no longer enough to rely on tradition when it comes to the Oval Office and financial transparency. Financial transparency should be a requirement for all presidents going forward — and the Supreme Court would do well to help pave the way.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Timothy L. O'Brien is a senior columnist for Bloomberg Opinion.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • EQS Group

    Deutsche Bank launches Tier 2 issuance and announces public tender offer for senior non-preferred debt

    Deutsche Bank AG / Key word(s): Bond Deutsche Bank launches Tier 2 issuance and announces public tender offer for senior non-preferred debt 11-May-2020 / 10:12 CET/CEST Disclosure of an inside information acc. to Article 17 MAR of the Regulation (EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. * * *Frankfurt am Main, 11 May 2020 - Deutsche Bank (XETRA: DBKGn.DE/NYSE: DB) launches a new euro-denominated Tier 2 issuance and announces a public tender offer for certain of its euro-denominated senior non-preferred securities. The target acceptance volume of the tender is 2.0 billion euros and the Tier 2 issuance will be of benchmark size.The new Tier 2 issuance will increase Deutsche Bank's total capital ratio and, as a consequence of the implementation of CRD V rules regarding the composition of P2R (Pillar 2 Requirement), improve its buffer versus regulatory capital requirements.The public tender offer is designed to manage the Bank's overall Minimum Requirement for Own Funds and Eligible Liabilities (MREL) supply by retiring various senior non-preferred securities, some of which lose their MREL recognition during 2020.It encompasses the following euro-denominated securities issued by Deutsche Bank AG:0.375% January 2021 (ISIN: DE000DL19T18) 1.625% February 2021 (ISIN: DE000DL19UQ0) 1.250% September 2021 (ISIN: DE000DB7XJB9) 3mE+65bp September 2021 (ISIN: DE000DB7XJC7) 1.500% January 2022 (ISIN: DE000DL19TA6) 1.875% February 2022 (ISIN: DE000DL19UR8) 3mE+80bp May 2022 (ISIN: DE000DL19TQ2) 2.375% January 2023 (ISIN: DE000DB5DCS4) 1.125% March 2025 (ISIN: DE000DB7XJP9) 2.625% February 2026 (ISIN: DE000DL19US6) 1.750% January 2028 (ISIN: DE000DL19T26)The offer is expected to expire on Friday, 15 May 2020.Information is available on Deutsche Bank's Investor Relations website under https://www.db.com/ir or by contacting +49 800 910-8000.Requests for the Tender Offer Memorandum may be directed to the Tender Agent: Lucid Issuer Services Limited (+ 44 20 7704 0880, db@lucid-is.com)Contact: Christian Streckert Phone: +49 69 910 38079 Email: christian.streckert@db.comEduard Stipic Phone: +49 69 910 41864 Email: eduard.stipic@db.com_________________________________________________________________Deutsche Bank AG Taunusanlage 12 60325 Frankfurt am Main Germany ISIN: DE0005140008 WKN: 514000Listed: Regulated market in Berlin-Bremen, Duesseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich und Stuttgart; EUREX; NYSEThe International Securities Identification Numbers (ISINs) of further financial instruments issued by Deutsche Bank AG, and admitted to trading on a domestic organized market or for which such admission has been applied for, are listed in the attached PDFs.Forward-looking statements contain risks This release contains forward-looking statements. Forward-looking statements are statements that are not historical facts; they include statements about our beliefs and expectations and the assumptions underlying them. These statements are based on plans, estimates and projections as they are currently available to the management of Deutsche Bank. Forward-looking statements therefore speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.By their very nature, forward-looking statements involve risks and uncertainties. A number of important factors could therefore cause actual results to differ materially from those contained in any forward-looking statement. Such factors include the conditions in the financial markets in Germany, in Europe, in the United States and elsewhere from which we derive a substantial portion of our revenues and in which we hold a substantial portion of our assets, the development of asset prices and market volatility, potential defaults of borrowers or trading counterparties, the implementation of our strategic initiatives, the reliability of our risk management policies, procedures and methods, and other risks referenced in our filings with the U.S. Securities and Exchange Commission. Such factors are described in detail in our SEC Form 20-F of 20 March 2020 under the heading "Risk Factors". Copies of this document are readily available upon request or can be downloaded from www.db.com/ir.* * *11-May-2020 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de * * * Language: English Company: Deutsche Bank AG Taunusanlage 12 60325 Frankfurt a. M. Germany Phone: +49 (0)69 910-00 Fax: +49 (0)69 910-43800 E-mail: db.presse@db.com Internet: www.db.com ISIN: DE0005140008 WKN: 514000 Indices: DAX, EURO STOXX 50 Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated Unofficial Market in Tradegate Exchange; NYSE EQS News ID: 1040599 End of Announcement DGAP News Service

  • Nomura Learns Some Uncomfortable Home Truths

    Nomura Learns Some Uncomfortable Home Truths

    (Bloomberg Opinion) -- So much for taking on Wall Street. Anyone expecting Nomura Holdings Inc. Chief Executive Officer Kentaro Okuda to have put the bank’s overseas misadventures behind it was in for a shock.Nomura reported its first loss in five quarters Friday, dragged down by declines in its internationally focused asset management and wholesale banking divisions. Overseas operations sank into the red at the pretax level for the first time in a year. By contrast, the domestic retail business turned a profit. During the coronavirus pandemic, home was the one place that remained safe for Japan’s largest brokerage.That should be troubling for investors hoping that Nomura had turned a corner and was poised to strengthen its position after former CEO Koji Nagai’s cost cuts left the company in seemingly solid shape at the turn of the year. Clearly, the Covid-19 outbreak couldn’t have been foreseen. What’s disturbing is that Nomura failed to soften the blow by generating meaningful trading profits from a quarter of wild volatility, in contrast to peers from Goldman Sachs Group Inc. to Deutsche Bank AG. It was also outshone by smaller Japanese rival Daiwa Securities Group Inc., which reported a profit for the period.Okuda, who took over from Nagai at the start of April, has pledged to continue his predecessor’s overhaul, which included significant management restructuring and a 20% reduction in Nomura’s Japanese retail brokerage branches. Hopes that the major surgery had been completed, which drove a 34% rally in Nomura shares last year, will now have to be discounted. The era of flip-flopping between expansion and retrenchment in its overseas operations may not be over after all.The 34.5 billion yen ($324 million) net loss for the three months through March is all the more surprising given that Nomura has a niche in bond trading, which was a key contributor to the previous quarter’s 57.1 billion yen profit. The brokerage’s bond trading revenue dropped to 78 billion yen from 99.7 billion yen in the December period, though it rose from a year earlier. Chief Financial Officer Takumi Kitamura said the wholesale business, which houses its bond trading activities, had an uncertain outlook.So what now for Nomura? Its core domestic retail business looks relatively healthy, despite Japan’s state of emergency closing several branches. The retail division reported pretax income of 18.4 billion yen, a more than fivefold increase from a year earlier.The priority should be on protecting and building its domestic franchise, where Nomura has a strategic advantage. That means continuing to invest in its digital operations. The bank has long been seen as a dinosaur in this area and has been losing business to more nimble online brokers.Nagai’s $1 billion cost-cutting program is 70% complete, Nomura said. It would make no sense to abandon a revamp that had appeared to be delivering sustainable results at the end of last year. As for its international business, shareholders could be forgiven for despairing. The brokerage has been trying to put its ill-fated 2008 acquisition of Lehman Brothers’ Asian and European operations behind it for more than a decade. The December quarter has proved yet another false dawn. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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