Whereas nominally, Deutsche Bank claims not to be in troubled waters, its high exposure in the US real estate sector is nonetheless a high risk.
The business with commercial real estate (CME) in the USA, an apparently unglamorous but very lucrative pool of investor funds of all kinds for a long time, is causing concern, the Frankfurter Allgemeine notes. The largest lenders here include US regional banks, which are now faced with the challenge of having to provide follow-up financing. The customer’s problem: the significantly higher interest rates, and the simultaneous fall in real estate valuations. This is a mix that could yet prove toxic — especially if interest rates in the US continue to rise on the back of still unresolved inflation.
