The collapse of Deutsche Bank shares causes serious damage to the sector

Major European banks record another day of sharp decline in the stock market, caused by a fall of more than 10% Deutsche Bank after the announcement of the write-off of subordinated debt to maturity.

As of this morning, the German company's securities are down 13.3%, the biggest drop among major European banks, while Germany's Commerzbank is down 8.4%.

The collapse of Deutsche Bank shares came after the company announced on May 24 that it plans to write off $1.5 billion of subordinated debt before it matures in 2028.

The bank assured that it has “all the necessary regulatory approvals” for this decision, but this has had a serious impact on the banking sector.

At the same time, shares of Italian Intesa and Unicredit lost 3.77% and 4.79% respectively, Nordea (Norway) - 9.7%; and the Dutch ING - 4-7%. BNP Paribas and Société Générale (both from France) fell 6.7% and 8%. In Spain, the two largest banks, Santander and BBVA, fell 4.8% and 5% respectively; CaixaBank - by 3.7%.

Some media outlets are pointing out that since last night, the risk of default on Deutsche Bank's subordinated debt, the so-called CDS (credit default swaps), has risen sharply.