Deutsche Bank to write down £1.9 billion in Q1
by Gill Montia
Story link: Deutsche Bank to write down £1.9 billion in Q1
Deutsche Bank has reported that it will be writing down £1.9 billion worth of assets for the first three months of 2008.
The bank also warned that trading conditions have become “significantly more challenging during the last few weeks” but did not expand upon how the writedown would impact on its annual profits.
However, it did reveal that its tier one capital (the amount of equity and reserves a lender must keep on its balance sheet to comply with financial regulation) will be in line with forecasts of between 8% and 9%.
In the third and fourth-quarter of last year, Deutsche Bank’s writedowns totaled £1.56 billion and last month it warned that further losses would follow.
The majority of the bank’s mortgage backed assets are “Alt-A” home loans. These are less risky than sub-prime but include mortgages where the borrower’s documentation is not complete.
Deutsche Bank will publish its first-quarter results at the end of April.
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