Mark Zuckerberg and Priscilla Chan: A Romantic Facebook Timeline
Why Facebook's Falling Share Price Really Doesn't Matter
On the heels of trading losses earlier this summer, Deutsche Bank (NYSE: DB) sought to reassure the markets on Tuesday that the investment bank's "strong risk management" had the kept the situation under control.
CEO Josef Ackermann acknowledged that Deutsche's investment banking business had been hurt by recent credit market turmoil, including constrained liquidity which many analysts called a credit crunch, but the CEO underscored that liquidity was returning to the market and that he was pleased with the banks overall performance.
"In the last few days, there have been signs that markets begin to stabilize. Liquidity is returning," Ackermann said in a statement. "Availability of funding has not been a problem for Deutsche Bank in recent weeks."
Still, Ackermann was careful to note that Deutsche, which derives nearly half of its revenue from sales and trading, would see an effect from market corrections on its trading revenue in August.
"The turbulent market conditions during the month of August inevitably affected Deutsche Bank, notably in sales and trading and corporate finance," Ackermann said. About one-half of Deutsche Bank's revenue stems from sales and trading. Deutsche's shares closed up $4.80 to $128.30 Tuesday.
Deutsche Bank closed on one of its credit proprietary trading desks, which invests the bank's own money, after it lost about Eur100 million, or about $136 million.
Fly Analysis: CEO Ackermann's comments contained candor, something Wall Street appreciates almost as much as it appreciates good news. Still, according to many research reports, the subprime issue is young and incomplete, and with Deutsche's mark-to-market valuations dependent on market conditions, the investment bank's performance in the quarters ahead will depend to a considerable degree on the health of the subprime sector and the absence of any additional negative surprises therein.
Goldman Earnings Sink After Buffett Dividend
Johnson & Johnson's Income Falls 23%
Burberry Shares Leap on Sales Update
