According to a report by Bloomberg News on Wednesday, Deutsche Bank is currently in discussions to sell approximately $1 billion worth of U.S. commercial real estate debt. During the bank’s third-quarter earnings call, CFO James von Moltke stated that they were pleased with the indicative pricing for these loans and have set aside €23 million (equivalent to US$24.8 million) in preparation for the sale, which has not yet been finalized.
In prepared remarks, Moltke also mentioned that their provision for CRE loans has been higher due to market conditions but has now decreased significantly quarter over quarter as expected. He expressed confidence in seeing signs of stabilization and expects future provisions to gradually decrease.
Reports from August indicate that Deutsche Bank is promoting this loan portfolio as a means of obtaining capital relief. Seeking Alpha noted that at the end of Q2, Deutsche had an exposure of $16 billion in U.S CRE loans with $7 billion specifically tied to office properties – making them a significant lender within this sector.
