It's been more than half a century, at a time when the world was at war that Deutsche Bank last absorbed a full year loss on it's books, that loss would be the last in the lifetimes of most of it's investors, a harbinger of the peace and prosperity to come for more than 60 years. Since the summer of 2007, the banks frantic paper efforts have kept it ahead of the relentlessly expanding shock wave of the credit burst, be it by accounting shenanigans, reclassifying$ 25 billion worth of level 3 assets or by direct governmental intervention on it's behalf forbidding investors from naked short selling the bank's stock. But paper tigers roar no more and despite desperate actions by all the kings men and Deutsche Bank's smolders where it stands, writing down more in it's fiscal fourth quarter 2008, than it did in all of fiscal 2007.
For the full year 2008, Deutsche Bank revised the total value of its assets lower by 7.0 billion euros, more than three times the 2007 write-downs of 2.3 billion euros.
In the fourth quarter alone, asset write-downs amounted to 5.3 billion euros.The bank has not raised cash nor does it any plans to. Furthermore chairman Josef Ackermann says the bank does not need and will not seek government assistance.
While other major German banks have benefited from a government rescue plan for the sector, Ackermann told a press conference: "We want Deutsche (Bank) to succeed in pulling out of this crisis by itself."
Ackermann added that he saw no "dramatic" risks in the bank's accountsNo government assistance for now at least, it a boastful ploy that we have heard before, we will have to wait and see, but by taking credit loss provisions of $1.1 billion bank screamed with actions that words cannot match that the best days lie behind it.
It also took provisions for credit losses worth a total 1.1 billion euros, an increase of 76 percent from the previous year.That 76% increase shows how fast the bubble imploded in on the bank. It had been more than 60 years since Deutsche Bank lost a single cent. After Deutsche Bank have posted a record profit of 6.5 billion euros in 2007, it took less than a year to loose 6.5 billion euros. But the heart of banking is a scam so for Chairman Josef Ackermann, reflexivly the lies continue.
In a statement earlier, he said "operating conditions in the (fourth) quarter were completely unprecedented and exposed some weaknesses in our business model.But the only model keeping the bank profitable for the past two quarters has been the above mentioned accounting and short selling intervention by which all the kings men still could not make Deutsche Bank profitable for full year fiscal 2008.
"We are certain that Deutsche Bank is going to come out of this crisis all the stronger," he added.We are not so confident that the bank will come out of this at all and neither were trades on the floor as they crushed the stock on Ackermann deliberate vagueness. It was only the commitment to the dividend that rescued the shares, inspired confidence and payed off the share heavy insiders as well, an ancillary little bit of juice no one wants to mention. The bank cut 12,000 jobs,compensation and costs where it could, but that divend is sacrosanct.
Then saying it as if it really meant anything Ackermann acknowledged that he would for go his 2008 bonus, given that the bank posted a loss makes you wonder just how much he could be forfeiting anyway. But he swears that he believes in investment banking, the same banking which ushered probably the first of many losses in over 50 years.
Ackermann said he remained committed to the bank's business model, which is focused on investment banking, a once lucrative field in which Deutsche Bank is one of the global leaders.That makes no sense, investment banking is dead, if you don't believe it just ask chairman Ackermann.
Confirming he is to step down at next year's annual meeting, Ackermann admitted to being "very disappointed" at the results and refused to give any guidance for 2009, despite insisting the bank had performed well in January.It's been more than half a century, since Deutsche Bank last absorbed a full year loss on it's books, the world was at war, but the world had never seen anything like this credit crisis. The implosison of Germany’s biggest bank is immenent, chairman Ackermann told you so the second he jumped ship. Germanys biggest bank now stands with both feet in concrete braceing for a future which the insiders sold out at the pinnacle of the credit bubble, but whose bills come due in the deep recession of a credit crunch which is only worsening. And while all king's horses and men do only that what will make matters worse Deutsche Bank burning through it's reserves smolders in the ashes of ponzi finance, unable to move, with nowhere to go.