Deutsche Pfandbriefbank in stock market crisis: US involvement is putting a strain on finances and bond prices. Financial expert warns of further crash.

Deutsche Pfandbriefbank in stock market crisis: US involvement is putting a strain on finances and bond prices. Financial expert warns of further crash.

According to a report by www.deraktionaer.de,

Deutsche Pfandbriefbank (pbb) is coming under increasing pressure on the stock market. The share price is hitting a new all-time low, while pbb's bonds are virtually collapsing. The reason for this development lies in the bank's commitment to the US commercial real estate market. Although the bank is trying to allay investors' concerns, confidence in pbb's financial position remains weakened.

Deutsche Pfandbriefbank (pbb), which was affected by the real estate crisis, emphasizes that it is more than adequately equipped with liquidity and that its liquidity coverage ratio (LCR) was 212 percent at the end of 2023, which is 112 percentage points above the value required by regulators. Despite these efforts, the bank's message initially failed to convince investors, as evidenced by the stock's decline in the early afternoon.

The collapse of pbb's AT1 bonds is particularly dramatic. The bank's €150 million Tier 2 subordinated bond fell 25 percent, while the €300 million AT1 subordinated bond suffered even steeper losses. The US bank Citigroup has left the rating for Deutsche Pfandbriefbank at “Sell”, citing risks and uncertainties regarding earnings and risk provisions.

The impact on the market and the industry is significant. pbb's financial situation remains unstable, and uncertainty about possible defaults on US loans is weighing on investor confidence. The payment of a dividend appears questionable and the stock is in a steep downward trend. pbb's bonds are also under pressure, which may affect the bank's financing options.

Overall, a bleak picture emerges for Deutsche Pfandbriefbank, which should worry investors and the entire industry.