Deutsche Bank 'planning €8 billion rights issue'

10 September 2010

Deutsche Bank is said to be planning a rights issue that is intended to raise between €8 billion to €9 billion ($10.2 billion to $11.4 billion) for the financial institution.

Insider sources told the Financial Times that an official announcement on the plan is likely to be made early next week.

Deutsche Bank is said to be preparing the money-raising effort in order to comply with stricter capital requirements for the financial sector that are set to be agreed at a meeting of the Basel Committee on Banking Supervision this Sunday (September 12th 2010).

The move by Deutsche Bank may lead other banks across the world to follow suit and conduct their own rights issues.

Last month, the Basel Committee proposed that bank bond investors should be liable to pay some of the costs of future bailouts of financial institutions, with debt listed as bank capital written off or converted to stock in the event of a crisis, reported Bloomberg.

By Claire Archer

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