Chillin' out till it needs to be funded
Deutsche Bank also announced that Deutsche Post, the part state-owned postal and logistics company, would take a short-term 8 per cent stake in the bank as part of a revised Postbank deal.
The two groups scrapped the terms of a Postbank deal agreed in September in favour of a “more capital-efficient” transaction for Deutsche Bank.
Deutsche Post, owner of Postbank, will get about 8 per cent of Deutsche Bank in return for a stake of 22.9 per cent in Postbank, valued at €1.1bn. The entire Postbank transaction is now worth €4.9bn.
It means Deutsche Post becomes Deutsche Bank’s biggest shareholder and sees the German government – whose development bank owns about 30 per cent of Deutsche Post – having an indirect stake in Deutsche Bank. Deutsche Post can sell the Deutsche Bank stake in two tranches from April onwards and people close to the bank on Wednesday rejected talk of part-nationalisation.
The revision of the Postbank deal is a further sign that Berlin wants the country’s banking consolidation to remain on track, after it supported Commerzbank’s takeover of Dresdner Bank. The government helped that deal through by giving Commerzbank more than €18bn in capital and taking a 25 per cent stake.
Deutsche Bank wants Postbank – which has more retail customers than any other German bank – to support its retail business and compensate for a big downturn in investment banking revenues.
Its decision to acquire Postbank had come under scrutiny since it was revealed last September, two days before Lehman Brothers’ collapse triggered widespread bank bail-outs and a fall in the value of financial institutions.
Postbank – which this week warned of bigger losses than expected for 2008 – now has a total market value of about €3bn. By contrast, Deutsche Bank first agreed to pay €2.8bn for just under 30 per cent of Postbank.
Germany’s largest bank will make a net loss of about €3.9bn for 2008, compared with net profit of €6.5bn in 2007.