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Deutsche Bank went out this morning with initial price thoughts of 360bp area over mid-swaps for a benchmark-sized 10.25-year Tier 2 note with a call at 5.25 years. In less than two hours, the book received in excess of EUR 3bn in orders and closed at EUR 6.5bn, according to Bond Radar (www.bondradar.com). Price guidance was MS+330bp-335bp and the spread was fixed at the tight end, at MS+330bp.

In its September 2021 rating report, Scope noted the bank’s resilient franchise in Europe as well as sound liquidity and asset-quality metrics, although from a business-line perspective the bank remains highly reliant on investment banking activities. In March 2022, Deutsche Bank published its new financial objectives for 2025, which are primarily targeting revenue growth particularly in the Corporate Bank segment combined with further significant cost reductions.

“Although the objectives set, such as an after-tax return on tangible equity of >10%, are subject to material uncertainty in the current situation, we believe that the group’s capital distribution will stabilise significantly in the coming years,” said Christian van Beek, lead analyst for Deutsche Bank.

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