Deutsche Bank Shares Plunge to Crisis Level

A road cleaning machine drives past the exterior of a Deutsche Bank AG bank branch in Berlin, Germany, on Wednesday, Sept. 28, 2016. Deutsche Bank AG rose in Frankfurt trading after the German lender agreed to sell its U.K. insurance business for 935 million euros ($1.2 billion) and Chief Executive Officer John Cryan ruled out a capital increase. Photographer: Krisztian Bocsi/Bloomberg via Getty Images

Deutsche Bank AG fell to the lowest since a crisis of confidence in 2016 as analysts cut their recommendations on the stock after it released disappointing fourth-quarter earnings on Friday.

Germany’s largest lender dropped in Frankfurt trading to a value last seen in November 2016. Earlier in the day, MainFirst analyst Daniel Regli lowered his recommendation on the stock to underperform, citing the bank’s “damaged franchise as well as a need for substantial restructuring, including the closure of several businesses.” He didn’t say which. Neil Smith at Bankhaus Lampe lowered the target price even though he maintained his buy recommendation.

Deutsche Bank has now fallen 19.6 percent since the beginning of the year, by far the steepest drop in the Bloomberg 500 Europe Banks and Financial Services Index. Barclays Plc had the second-worst performance among big banks with a 5.1 percent decline.

The Steepest Drop

Deutsche Bank is the worst performer year-to-date among European banks

Source: Data compiled by Bloomberg

Note: Year-to-date percent change in share price

Chief Executive Officer John Cryan on Friday reported the lowest quarterly revenue since 2010 amid a trading slump that has hurt the lender’s investment bank. A sell-off across global equity markets at the beginning of the week further depressed the share price and it has continued to fall on Wednesday while most competitors saw their stocks rebound.

Deutsche Bank had struggled to stem a slide in its shares and maintain client confidence after the U.S. Department of Justice requested $14 billion in September 2016 to settle a probe tied to sales of mortgage-backed securities. The German lender reached an agreement worth $7.2 billion in December of that year.

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