Monday, October 3, 2016

“I don’t know whether to laugh or cry,” says vice chancellor Merkel about the CEO of Deutsche Bank – the Public.en

The vice-chancellor and German minister of Economics, Sigmar Gabriel, not liked the most recent comments from the chief executive of Deutsche Bank, John Cryan, on the current situation of the German bank. The vice-chancellor accuses the CEO of mismanagement.

The minister of Economy answered this Sunday to the statements of John Cryan Friday, in internal note remember that the "trust is the basis of the financial sector". "Some of the forces of the market are trying to undermine this confidence," wrote the CEO of deutsche bank, cited by Bloomberg. John Cryan insisted that "Deutsche Bank has lots of problems, but liquidity is not one of them."

The answer from Berlin came two days later. “I don’t know whether to laugh or cry with the fact that the bank that had a business model based on speculation and say, now, that is the victim of speculation,” said the vice-chancellor Merkel, during a trip to Iraq.

Cited by Reuters and by the Financial Times, the minister of Economy, emphasised its concern with the 100 thousand employees of the German bank. “The scenario are thousands of people who will lose their job. You will pay the price of the madness of the leaders irresponsible,” said Sigmar Gabriel.

In line with the fears of the governor of German, this Monday morning, the agency Bloomberg advances that the bank plans to cut about a thousand jobs, a reduction that will hit mainly the workers of the central services of the company. The dismissal adds to the already announced cut of 3 thousand jobs announced in June. In October 2015, the bank decided to move forward with a restructuring, after a loss of seven million euros in 2015 and that provides for the termination of approximately 200 agencies in Germany until 2020 and the reduction of more than 9 thousand jobs in the world.

last Friday, the actions of the largest German bank were to fall close to 6%, after the indication that the regulators in the us were asking for $ 14 billion of compensation to which the case against Deutsche Bank was closed, because of its role in the international financial crisis of 2008. The institution is accused, alongside other big banks have sold mortgage loans (loans that are converted into financial products), knowing that they were toxic.

The market reacted immediately and after some news that spoke of a plan of capital injection by the German Government, Berlin belied to be working on a rescue plan to the banking institution.

Now, the comment of Sigmar Gabriel, leader of the social democrats of the SPD that share the coalition with the conservative party of Merkel, reinforce the point that, should the bank go even with a request for help, it is not certain that the German Government is available to respond. According to some analysts, a financial injection to the institution would harm the image of the German chancellor, who was often a voice critical of the intervention of european States in the rescue of banking institutions. In addition, Merkel is facing an election next year, so that an intervention could cost the victory to his party.

Now Peter Ramsauer, chairman of the Economy Committee of the German Parliament, is not spared in the criticisms of the USA and stated in an interview with the Welt am Sonntag that the actions of the regulatory authorities of the north-american "have the characteristics of an economic war".

Despite news that questioning the solidity of the bank, some of the biggest names in German industry have already pledged support to the Deutsche Bank. "German banks are strong are important for the German economy stronger", said Dieter Zetsche, responsible for the automobile manufacturer Daimler, in remarks to the German newspaper Frankfurter Allgemein.

This Monday, european stock markets remained uncertain, with the Frankfurt Stock exchange closed due to the holiday of the day of German unification and the investors pay attention to Deutsche Bank.


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