Deutsche Bank announces €1bn bond buyback
German lender Deutsche Bank today said it would buy back €1bn (£890m) of bonds as it aims to lower its expensive liquidity reserve.
The bank said in a statement that it is announcing a public tender offer with a target acceptance volume of €1bn of Euro-denominated securities.
Deutsche said the deal is aimed at helping the bank “optimise its future interest and maturity structure by taking advantage of a strong liquidity position”.
At 30 September the bank had liquidity reserves of €268bn with a liquidity coverage ratio of 148 per cent.
Chief financial officer James von Moltke said: “Using a small part of our high cash position to repurchase senior non-preferred securities reflects our aim to redeploy excess liquidity without taking undue risk. This benefits all our stakeholders.”
The offer relates to two long-dated securities – one of 1.125 per cent dated March 2025 and one 1.75 per cent dated January 2028.
Prior to the announcement the two bonds were trading at around 92 cents and 88 cents on the euro.
If Deutsche buys back the bonds at a lower price than it issued them, it will make a profit.