Deutsche Bank Needs Transition to New Model: Dichtl

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Jan. 29 (Bloomberg) -- Otto Dichtl, Managing Director at Stifel Nicolaus Europe, discusses Deutsche Bank’s industry strategies and outlook for the company. He speaks on Bloomberg Television's “The Pulse.” (Source: Bloomberg)


They are saying they are not happy.

Investors should be getting more.

That is great.

Thank you.

What are they going to do about it?

I think you are pointing to where the issue that deutsche bank is really an a fundamental and very large transition program.

The key issue for them really is that investment banking as deutsche bank had it and pursued it is really under attack from a lot of fronts.

In particular, the regulatory side.

They need to transition that to a new model that is not entirely defined yet, i think.

Because of the regulatory environment?


Also because the effect of all the changes are not really fully understood yet.

That is something ongoing.

One of the outpourings so far is that -- especially the fixed income business which is deutsche's strongest suit, has been under a lot of pressure.

Anshu jain this morning, we are going to remain the leader in fixed income and currencies.

You look at what ubs is doing.

You look at other institutions.

Is deutsche making the right call?

Is anshu jain making the right call?

At what point do we start questioning their business strategy and the targets they set out in 2012? only time will tell.

It certainly seems to make sense if you are a market leader in a certain business to not give that up easily.

Since it is a core of what deutsche bank stands for, it certainly seems to be some sense in that.

Deutsche bank has moved away to some extent from earlier strategies where they said, we want to be a top three player.

Otherwise, we don't think we can make any money.

They have actually pulled back a little bit already from that and are now saying, they will focus on costs.

There is a retrenchment ongoing as well at deutsche bank.

We don't really know how far that will take us.

Let's talk about the finances.

They are saying the cost of litigation will not be "above average." let's talk about the capital ratio.

Jain earlier on, on the tape as well, talking about the fact that the capital ratio could come under pressure.

It is going to be volatile.

This is the issue that got everybody frightened with deutsche 18 months ago, two years ago.

They are not well-capitalized enough.

He is talking about volatility.

Clearly that is not a helpful thing.

The fixed income market, their ratios are arguably strong enough not to make this a big issue.

For the equity market, it is much more of an issue.

The unspoken thing in the room there is, will they go for another capital increase?

Do you think they will have

This text has been automatically generated. It may not be 100% accurate.


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