Market Overview

Deutsche Bank Stock Is Dropping More Than Other Peers After Greek News

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Shares of Deutsche Bank AG (USA) (NYSE: DB) were among the worst performers in the financial sector on Monday morning.

Shares of the German-based bank were trading lower by around 4.5 percent at $30.10 shortly after the opening bell.

According to a Bloomberg report on June 29, Deutsche Bank has a $2.3 billion exposure in Greece, the third largest after HSBC Holdings plc (NYSE: HSBC)'s $5.5 billion exposure and Credit Agricole SA's $3.2 billion.

A Deutsche Bank spokesperson told Reuters that the company continues to monitor the situation in Greece and "adjusted our processes and procedures to take into account the new situation."

Related Link: Will Greece Affect The Options Market This Week?

Deutsche Bank investors are also on edge following a June 12 report by Zero Hedge that Deutsche Bank is shaping up to be "the next Lehman Brothers" as the bank was forced to raise 1.5 billion of Tier 1 capital in 2014 and then sold eight billion euros worth of stock at up to a 30 percent discount.

More recently, the bank failed its recent "stress test" fail and then saw its two CEOs announce their surprise departure from the company. Just a few days later the rating agency S&P lowered the bank's rating to BBB+ (three notches above "junk".)

"And that's where we are now. How bad is it?," Zero Hedge wrote. "We don't know because we won't be permitted to know. But these are not the moves of a healthy company."

The article also pointed out that, "If Deutsche Bank is the next Lehman, we will not know until events are moving at an uncontrollable and accelerating speed and by the time we are aware of a crisis – if one is in the offing — it will already be a roaring blaze by the time it is known publicly."

Deutsche Bank Underperforming Its European And American Peers

For the most part, European based banks were underperforming its North American peers.

Shares of HSBC were trading lower by only 2.13 percent while Euronext Paris listed Credit Agricole's shares were lower by 2.54 percent. In addition, shares of UBS Group AG (NYSE: UBS) were lower by 3.34 percent, Barclays PLC (NYSE: BCS) was trading lower by 3.30 percent.

Meanwhile, shares of Bank of America Corp (NYSE: BAC) were lower by 0.76 percent while shares of Citigroup Inc (NYSE: C) were lower by 0.74 percent. Goldman Sachs Group Inc (NYSE: GS) saw its shares trading down by 0.70 percent.

Shares of JPMorgan Chase & Co. (NYSE: JPM) were among the best performers, losing only 0.46 percent.

Shares of the Financial Sector ETF, the Select Sector Financial Slct Str SPDR Fd (NYSE: XLF) were trading lower by 0.53 percent.

Of note, a lone outlier, shares of Nomura Holdings, Inc. (NYSE: NMR) spiked higher by more than 5 percent and established new 52-week highs of $7.22.

Posted-In: banks Bloomberg European banks Lehman Brothers Reuters Zero HedgeIntraday Update Movers

 

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Who'll Leave The E.U. First: Greece Or The U.K.?