Deutsche Bank rows back on strategy, announces capital raise, asset management IPO

Deutsche Bank management changed tack at the weekend, saying it would float its coveted asset management arm and sell new shares in a bid to build-up its capital buffers.

On Sunday, chief John Cryan said Germany's largest lender would sell €8.0bn in stock and list its AM unit over the next two years.

The latter move would, alongside other divestments, help raise a further €2.0bn of fresh capital.

"It’s a positive step forward that we take the brave step of admitting we were going in the wrong direction," Cryan said.

Cryan also announced that its investment banking and trading businesses would be brought back together again, just one year after having split them up.

It would also reintegrate Postbank.

Current finance chief Marcus Schenck and Garth Ritchie would head the new investment bank and trading unit and were named co-deputy CEOs; however, Cryan also indicated he would stay.

Frankfurt-based Deutsche Bank still aimed to slash costs to the tune of €22.0bn by 2018, the lender said.

The lender generated net losses in excess of €8.0bn over the past two years, amid fines for alleged financial misconduct and as it reduced its footprint in trading debt securities.

Deutsche Bank would propose a dividend of €0.19 per share in May.

As of 0908 GMT stock in the lender was down by roughly 5% to €18.11, having hit a one-year high at €19.55 on 1 March.

Deutsche Bank's €1.75bn of additional Tier 1 bonds on the other hand were trading six euro cents higher to 97 cents of their face value as of 1105 GMT.