Update, 2/12/16: Deutsche Bank should insist on an immediate buyout of its Las Vegas casino stake through the Station Casinos IPO. In October 2008, as the last global financial crisis raged, Deutsche Bank’s CEO Josef Ackermann boasted to German reporters that his bank did not need and would not accept a government bailout, a claim that’s been often repeated in the financial press. “I would be ashamed if we were to take state money during this crisis,” he reportedly said.[1] But how do you define “bailout” and “taking state money”? If, for example, one narrowly construes a bailout to be a direct equity infusion from government coffers, then Ackermann is correct – Deutsche Bank, unlike its smaller rival Commerzbank, did not receive an equity infusion from the German government. Nor did it receive funds directly from the US Troubled Asset Relief Program (TARP.) But that doesn’t mean it didn’t accept government rescue money during the financial crisis. Consider the following: As one of the largest counterparties of failed insurer AIG, Deutsche Bank received $11.8 billion of the funds used to bail out AIG. [2] The Federal Reserve made emergency low-cost funds widely available to foreign as well as US member institutions through […]
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