Sideways: Banks get to mark their own balance sheet homework
Bank balance sheets are ballooning and regulators are just fine with that.
Deutsche Bank became the latest firm to warn that it will miss capital targets due to provisions and an expanded balance sheet, in a pre-announcement of its first-quarter earnings on Sunday April 26.
The big surprise in the release was that Deutsche will actually turn a profit for the first quarter. Revenue will be a higher than expected €6.4 billion and pre-tax profit €206 million – when many analysts had expected a loss of at least that amount.
Christian Sewing leads a management team at Deutsche Bank with more credibility than recent incumbents
Deutsche said that its capital may fall “modestly and temporarily” below its common equity ratio target of at least 12.5%,