Deutsche Bank Exodus Continues As Real Estate Chief Leaves For Blackstone

Have you ever wondered which big bank after Lehman Brothers would be next to fall? This is why you see so much shuffling from within and people resigning suddenly and going to work for another institution.

Moreover, with over $72 TRILLIONyes trillion, in derivatives exposure — we have likely found it. To put this tiny bit of risk in perspective, the GDP of Germany itself is a mere humble $2.7 trillion.

This is why Germany is also worried in this high stakes game of chicken. If Greece goes, Deutsche Bank who’s heavily invested will go, and creates the possibility of bringing the country with it. From there you can only see how such a scenario would spread to the rest of the world.

 

Earlier this month, Deutsche Bank’s co-CEOs Anshu Jain and Jürgen Fitschen were shown the door (well, technically they resigned, but with shareholder support plummeting amid skepticism about both financial targets and ongoing legal problems, it’s easy to read between the lines). The bank, which has paid out more than $9 billion over the past three years alone to settle legacy litigation, has become something of a poster child for corrupt corporate culture. Consider the following rundown of the legal problems the bank faced as of the beginning of its 2015 fiscal year:

We are currently the subject of regulatory and criminal industry-wide investigations relating to interbank offered rates, as well as civil actions. Due to a number of uncertainties, including those related to the high profile of the matters and other banks’ settlement negotiations, the eventual outcome of these matters is unpredictable, and may materially and adversely affect our results of operations, financial condition and reputation.  Continue reading

Is Deutsche Bank the next Lehman?

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Looking back at the Lehman Brothers collapse of 2008, it’s amazing how quickly it all happened.  In hindsight there were a few early-warning signs,  but the true scale of the disaster publicly unfolded only in the final moments before it became apparent that Lehman was doomed.

And the rest is history.

Could this happen to Deutsche Bank?

By the time we are aware of a crisis – if one is in the offing — it will already be a roaring blaze by the time it is known publicly.   It is by now well-established that truth is the first casualty of all banking crises.  There will be little in the way of early warnings.   To that end, we begin connecting the dots: Continue reading