Deutsche Bank (Wikipedia photo, Flash 90/ Nati Shohat)
Deutsche Bank shares fell more than 9% in early trade today (Friday) following a jump in the credit CDS risk premium on Thursday night, as concerns about the stability of European banks continued.
The German lender’s shares retreated for a straight day on Tuesday and have now lost more than a fifth of their value so far this month. The bank’s risk premium jumped to 173 basis points on Thursday night from 142 basis points the previous day.
The emergency bailout of Credit Suisse by UBS, following the collapse of SVB Bank, has sparked concern about contagion among investors, deepened by further monetary policy tightening by the US Federal Reserve on Wednesday.
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Deutsche Bank’s additional bonds ( AT1 ) — an asset class that hit the headlines this week after Credit Suisse’s controversial AT1 downgrade as part of its bailout deal — also sold off sharply.
Deutsche led broad declines in Europe’s biggest banking stocks on Friday, with Commerzbank, Credit Suisse, Societe Generale and UBS all down more than 5%.
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