German newspaper Bild am Sonntag reported that bank CEO John Cryan had failed to come to an agreement with senior representatives of the U.S. Department of Justice in a meeting late Friday. Sources confirmed the lack of a deal to CNBC but the bank declined to comment when contacted.
The perception is that Deutsche Bank needs to raise cash after the U.S. Justice Department (DOJ) suggested it pay $14 billion to settle a number of investigations. Initial worries about Deutsche Bank actually surfaced earlier in the year, with investors detailing concerns over its exposure to the energy sector and a possible cash crunch.
The bank has repeatedly defended itself over recent weeks, however, telling CNBC that there is “no reason to worry” and that the bank had a “comfortable cushion.” Deutsche Bank’s stock has slid over 48 percent so far this year and the cost of insuring exposure to its debt has risen sharply. It has come under pressure from aggressive short-selling, notably from some large hedge funds.
The recent saga surrounding Germany’s biggest bank follows a report late last month that it was close to a $5.4-billion dollar settlement with the Justice Department. However, the lack of an official announcement quashed rumors of the deal and the latest negotiations look to be another setback.
