Investors sparked a selloff in Deutsche Bank AG DB -3.16%decrease; red down pointing triangle and thrust one of Europe’s most important lenders into the center of concerns about the health of the global financial system.
Shares of Germany’s largest lender tumbled as much as 15%, their third consecutive day of losses, though they later regained some ground and were recently down 10%. The cost to insure against its default using credit-default swaps soared to their highest levels since 2020.
The concern over Deutsche Bank emerged days after Credit Suisse Group AG was forced into a takeover by its larger and more stable rival UBS Group AG. Since the collapse of Silicon Valley Bank in the U.S. earlier this month, investors have scoured the globe for institutions perceived as vulnerable.
“People want to avoid anything that could come under focus,” said Jon Jonsson, credit portfolio manager at Neuberger Berman.