German Chancellor Angela Merkel has nixed any bail out for Deutsche Bank prior to the national election next September, Focus magazine reported, citing unidentified government officials.
The German leader has also ruled out helping the bank’s with its legal imbroglio with the US Justice Department, which is seeking $14 billion in sanctions against the bank’s mortgage-backed securities business, the magazine said.
Deutsche’s shares are down 5.5% in pre-market trading in the US on the report.
The similarities between Deutsche and Lehman Bros. keep coming up. Lehman was forced into bankruptcy before Washington got into picking winners in 2008, now Deutsche is being brought to its knees as its stock price will open at an all-time low of $12 a share.
I’m not alone in seeing the similarities, European bourses are down more than 1.5% on the news that Germany’s largest bank is on its own.