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ECB asks Deutsche Bank to simulate costs of winding down trading - CFO

Reuters  |  FRANKFURT 

(Reuters) - The has asked to estimate the costs of winding down the trading operations of its investment bank, the first such by one of Europe's biggest banks, Deutsche's chief said on Monday.

But said the ECB's request was not an unusual exercise and that it was totally unrelated to Deutsche's internal review of its global investment

"We think we are first in the queue here because we are the largest capital markets in the ECB's supervision," von Moltke said in an interview with

The timing of the is sensitive because Deutsche Bank's division has been losing market share and key staff, contributing to three consecutive years of losses at Germany's largest lender.

Last week, Deutsche ousted its and Marcus Schenck, one of the heads of the investment bank, also left. The management upheaval has added to speculation that might slim down its sprawling operation.

An declined to comment on individual "There are in general various exercises such as recovery plans which the asks to provide," she said. "In any case, the does not intervene in any business model decision of "

Deutsche Bank, by talking publicly about normally private supervisory exercises, wants to avoid the impression that regulators are worried about the investment

The has stabilised since late 2016, when speculation mounted that it would need a government bailout in the wake of huge fines from U.S. authorities.

Global regulators are working on unified procedures for such exercises like the one that Deutsche is conducting. Regulators are primarily focused on big global that trade risky securities like derivatives.

The regulators have categorised some as "sytemically important" because of their size. They have identified as the most systemically important in the euro zone.

Regulators in Britain have already conducted a similar with Deutsche's London-based arm.

The exercise can shed light on whether a sudden halt of trading activities would require government guarantees or support from taxpayers, the said in its Monday edition. The German paper was the first to report the of the

"This (the exercise) doesn't have any connection to any sort of state aid," von Moltke said.

began the task in late January and expects to conclude it in the third quarter.

(Reporting by and Andreas Framke; Additional reporting by Frank Siebelt; Editing by and Jane Merriman)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, April 16 2018. 20:21 IST
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