Deutsche Bank and its senior unsecured notes were upgraded to A- from BBB+ by S&P with a stable outlook. The upgrade comes on the back of Deutsche Bank’s operational restructuring launched in 2019 to transform it into a more profitable, more focused, and better-controlled group. The bank is two-thirds of the way through implementing the plan and almost all of the associated restructuring costs are expected be expensed by the end-2021. S&P notes that the transformation program is more decisive than previous editions in addressing its excessive costs and multiple underperforming business units. The rating agency added that Deutsche Bank’s execution has also been rigorous to achieve its 2022 targets. S&P notes that Deutsche Bank has been able to leverage favorable market conditions to grow revenue despite the restructuring of its business. It expects the lender’s earnings to improve in 2022. Another positive the rating agency sees is Deutsche Bank now maintaining a strong record in financial risk management, and its credit exposures are well-diversified and significantly collateralized.
Deutsche Bank’s dollar bonds were stable – its USD 6% Perp was at 105.38, yielding 4.5%.
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