A US banking regulator has rated Deutsche Bank's US subsidiary as an at-risk institution, a person familiar with the matter told AFP Thursday. The Federal Deposit Insurance Commission classified the German bank among its "problem banks," according to the source, who spoke on the condition of anonymity.
The designation adds to the woes facing the big German bank, which also was downgraded to "troubled condition" by the Federal Reserve, the Wall Street Journal reported Thursday. The FDIC, which provides deposit insurance to US banks, considers "problem banks" to have "financial, operational, or managerial weaknesses that threaten their continued financial viability," according to the agency's website.
At the end of March, the FDIC listed 92 banks as problems, down from 95 at the end of December, but the assets connected to the institutions had risen by $42.5 billion, roughly the amount held by Deutsche Bank. The FDIC does not disclose the names of banks on the "problem bank" list.
"As a matter of policy, we do not comment on specific regulatory feedback," a Deutsche Bank spokeswoman said. "The ultimate parent of the Deutsche Bank Group, Deutsche Bank AG, is very well capitalized and has significant liquidity reserves."
The bank's US subsidiary "has a very robust balance sheet as disclosed in our annual and quarterly regulatory filings," she added. "We have previously indicated that our regulators have identified various areas for improvement relating to our control environment and infrastructure. We are highly focused on addressing identified weaknesses in our US operations."
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