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FT.com / Companies / Banks – Deutsche Bank losses predicted to reach €800m

Deutsche and Goldman Sachs had been the two financial institutions that had most successfully navigated the credit meltdown.

The credit trading group, headed by Boaz Weinstein in New York, made billions for Deutsche Bank, especially last year, when the group took large negative bets on subprime mortgages. But its positions went wrong after Lehman Brothers filed for bankruptcy protection in mid-September.

During the third quarter Deutsche lost €386m in equity proprietary trading and €873m on the credit side. But the bank recorded a net profit for the quarter of €414m after reclassifying some of the assets on its balance sheet.

The credit trading group under Mr Weinstein traded corporate and convertible bonds and credit default swaps. Compared with hedge funds which dabbled in the same areas, such as Citadel, which was down 47 per cent year to the end of November, the losses at Deutsche Bank have been fairly small.

via FT.com / Companies / Banks – Deutsche Bank losses predicted to reach €800m.

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This entry was posted on December 13, 2008 by in Financial Markets, Meltdown, Uncategorized.

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