Brexit turmoil to affect Deutsche Bank

Bloomberg

Soros Fund Management took a short position in Deutsche Bank AG of about 7 million shares as turmoil from the UK’s decision to leave the European Union sent bank stocks lower.
The position taken was equivalent to 0.51 percent of Deutsche Bank’s share capital, according to a German filing. The document doesn’t show at which price the fund took the position.
Their highest price that day was 13.95 euros. At that level, a 0.51 percent stake would be worth about 98 million euros (US$108 million). After extending losses, the shares were trading 4.5 percent higher on Tuesday in Frankfurt.
German newspaper Die Welt reported the sale earlier.
Fallout from the UK referendum could force banks to take losses on trading assets and lead clients to hold back from raising funds and pursuing acquisitions. That may complicate Deutsche Bank’s efforts to lift returns and capital levels to reverse a stock slump that has made it the worst-valued global lender.
The UK’s decision may cut the total net income of European banks in the three years through 2018 by 32 billion euros, while UK bank profits may be 10 billion euros lower, according to analysts at Goldman Sachs Group Inc.

Marshall Wace
Hedge fund Marshall Wace had 6.62 million Deutsche Bank shares in a short position, according to a filing dated June 17. A spokesman for the company declined to comment on the
position.
In short sales, investors borrow securities and then sell them in the belief that they will later be able to purchase them for a lower price.
George Soros, the billionaire whose 1992 wager against the pound made hedge fund history, was ‘long’ the currency before Britain’s vote to leave the EU, a spokesman said.
“Because of his generally bearish outlook on world markets,” Soros did profit from other investments, according to the statement.