Deutsche Bank denies reports it could raise €10bn for Commerzbank merger
Deutsche Bank shares have slid further after the German lender was forced to deny reports it has discussed raising up to €10bn (£8.6bn) for its proposed merger with Commerzbank.
Exploratory talks between Germany’s two biggest banks have been ongoing since contact was initially made earlier this month.
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Deutsche Bank executives have discussed raising between €3bn and €10bn, the Financial Times first reported.
But the bank denied that any discussions over a capital increase had taken place.
The merged bank would become the Eurozone’s second largest lender behind BNP Paribas, with around €1.9 trillion (£1.6 trillion) in assets and a market value of €25bn.
Speculation over how much capital Deutsche Bank would need to raise to complete the deal has differed markedly.
The German government, which has pushed for the merger, is understood to want Deutsche Bank to raise as much capital as possible to boost the combined bank.
Deutsche Bank said it was “much too early” to assess whether there was any potential capital need before robustly denying media reports.
Reports also emerged that the bank was on course for a weak first quarter after a slow start to 2019 in its trading business, with sources telling Reuters January was “catastrophic.”
A Deutsche Bank spokesman said: “To be clear there have been no discussions with the management board of Deutsche Bank about a capital increase in relation to the potential Commerzbank transaction.
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“Furthermore, we have not even decided whether to do a transaction with Commerzbank at all.”
Shares fell 3.4 per cent to €7.26.