BTC iShares MSCI Europe Financials ETF

Shares of Deutsche Bank (DB) have fallen nearly 10% in the last three trading sessions. Efforts to reassure investors about its ability to pay coupons on its AT1 bonds were in vain.

On its own stage across the Atlantic from the US Fed, the ECB (European Central Bank) has had its own quantitative easing program.

Investors who are concerned about Deutsche Bank’s bankruptcy are looking at CEO John Cryan’s plan to restructure the company’s operations.

Deutsche Bank is proving to be the most dangerous bank to the global economy. It failed the Fed’s 2016 stress tests in June 2016.

Deutsche Bank could be the biggest beneficiary under Trump, having been on the brink of bankruptcy until its stock spiked nearly 20% after the election.

Deutsche Bank’s (DB) shares are currently trading at distressed valuations. The bank’s shares are trading at the steepest discount to its book value, worse than the 2008 financial crisis.

Deutsche Bank’s stock is down nearly 40% in 2016 so far. Capital reserves are important to restore the confidence of regulators and investors.

According to Factset data, around 93% of companies in the utilities (JXI) sector and 80% in the telecom (IXP) sector reported revenues below estimates in the second quarter of 2016.

Deutsche Bank operates under five segments. Corporate Banking & Securities contributes 50% to Deutsche Bank’s revenues.

On average, European banks have higher leverage than US banks. An excess buildup of leverage increases a bank’s exposure to the risk of bankruptcy.