Deutsche Bank changes tack with share issue

Deutsche Bank shares sank almost 6% today as the troubled lender embarked on an €8 billion (£6.9 billion) capital raising.

The company announced last night that it would pursue a rights issue, its fourth capital hike since 2010, issuing 687.5 million new shares on March 21. Boss John Cryan had previously seen such a move as a last resort.

Today shares in Deutsche were the biggest fallers on the DAX, Germany’s main stock index.

Deutsche Bank made a net loss of €1.4 billion last year after receiving heavy fines for a string of scandals. In January it was hit with a £503 million penalty for money laundering via banks in London.

It is planning a reorganisation, listing a minority stake in its asset management arm and offloading other assets. It will also bring its securities trading business and corporate finance together and scrap the sale of its Postbank unit.

“On strategy, it’s obvious we had a change of heart,” Cryan said. “Our decisions are a significant step forward on the path to creating a simpler, stronger and growing bank.”