FRANKFURT: Shares in Deutsche Bank fell heavily on Friday on the lender's surging cost of default cover, reigniting fears about a widening banking sector crisis.
Germany's biggest lender dropped more than 14 percent on the Frankfurt Stock Exchange in early trade before clawing back ground to close 8.5 percent lower, at 8.54 euros.The cost of insuring the bank's debt against a risk of defaulting ― so-called credit default swaps ― has surged as investors fret about the banking sector's health.
German Chancellor Olaf Scholz, however, offered reassurances about Deutsche Bank, saying the lender had 'modernized and organized the way it works. It's a very profitable bank. There is no reason to be concerned.'Speaking in Brussels after a summit of EU leaders, he also said the European banking system was 'stable' with strict rules and regulations.Deutsche Bank also said Friday it would redeem $1.
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