March 5 (UPI) — Deutsche Bank announced plans Sunday to raise an additional $8.5 billion in capital and reorganize its retail operation in Germany.
The company, which also has major operations in London and New York, announced it will raise new shares after a meeting by its supervisory board Sunday. The bank has raised capital two others times in the past four years.
The bank — the largest one in Germany — lost $1.5 billion in 2016 after a $7.2 billion dollar settlement with the United States Justice Department over the bank’s sale of toxic mortgage securities. Also, about 7,000 separate lawsuits and regulatory cases against the Frankfurt-based bank remain active.
“Our decisions are a significant step forward on the path to creating a simpler, stronger and growing bank,” John Cryan, the firm’s chief executive, said in a news release. “The capital increase will reinforce our financial strength substantially. The new three-pillar structure of our operating business should position us for significant growth, both in revenues and earnings.”
In an interview seven weeks ago with CNBC, Cryan said that hiking capital was not the best option to improve its financial situation.
Last month, Cryan apologized to investors for problems by the bank.
The bank plans to integrate Postbank, a German retail banking business, with its private and commercial clients business in Germany. The company has tried to sell the Postbank business since spring 2015.
“This now offers Deutsche Bank the opportunity to create Germany’s biggest private and commercial bank, retaining a multi-brand approach,” the bank said.
The combined business would have more than 20 million customers with planned savings of $23 billion by 2018.
And the bank said it would combine its global markets business with its corporate and investment bank. In 2015, the bank separated them in restructuring.
Cryan also will assume the additional role of responsibility for the bank’s U.S. business
