Deutsche Bank May Have Rating Cut By S&P As Legal Costs Rise

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Deutsche Bank may have its credit rating cut by Standard & Poor’s after the lender reduced its reported profit for 2012 amid rising legal costs.

Bloomberg reports that Deutsche Bank’s A+ long-term rating was placed on CreditWatch negative, S&P said Tuesday in a statement.

Deutsche Bank said last week it had set aside additional money to cover costs linked to U.S. mortgage lawsuits and other regulatory probes, lowering 2012 profit by about $514m.

'Ongoing economic, regulatory, and legal risks will continue to hurt the bank’s performance', S&P said in the statement.

The bank’s ability to generate capital amid Europe’s economic turmoil, including 'recent tensions in Cyprus, faces 'substantial risks', S&P said. 'Deutsche Bank’s capitalization is still below peers’ in our view, despite a significant improvement on the second half of 2012'.

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Deutsche Bank May Have Rating Cut by S&P as Legal Costs Rise

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