Deutsche discloses higher exposure to Greece, Spain

FRANKFURT (Reuters) - Deutsche Bank said on Tuesday it had net exposure of 1.1 billion euros to Greece, 8.1 billion euros to Italy, and 1 billion euros to Spain at the end of March, more than double figures it had previously given.

Germany's largest lender said Tuesday's numbers were higher because they were calculated using the methods set out by European regulators for pan-European stress tests, rather than the lender's own, less comprehensive, risk model.

Earlier this year, Deutsche said it had 500 million euros ($645.5 million) exposure to Greece at end-March 3.2 billion euros exposure to Italy, and no overall sovereign exposure to Spain or Portugal after accounting for hedging.

Deutsche said its exposure to Greece, based on the European regulator's method, had declined to 500 million euros by the end of June, from the end-March level of 1.1 billion.

Deutsche Bank was the last German lender to detail its government debt holdings in heavily-indebted euro zone members.

Some German lenders, including nationalized Hypo Real Estate, had initially declined to publish those details as part of pan-European stress test results issued on Friday.

Their decision to hold back raised investor fears that they had something to hide and drew criticism from the Committee of European Banking Supervisors (CEBS), which oversaw the tests.

Deutsche Bank said its own risk model differed from CEBS methodology, particularly in the calculation of exposure to local authorities, public sector entities, multilateral development banks and international organizations.

Deutsche Bank published details on its sovereign exposure as part of its second-quarter earnings on Tuesday. It turned a net profit of 1.2 billion euros and its shares were up 6 percent at 13.03 GMT, outpeforming a 5 percent rise in the European Stoxx 600 banking index.

Exposure to weaker euro zone economies has been a concern among regulators following worries earlier this year that Greece may struggle to service its government debt.

"The outlook for the banking industry is affected by a number of issues, including ongoing concern about public finances in several developed countries and potentially slower growth in the major economies of Europe and America," Deutsche Bank said in its second quarter earnings report.

It also said it had a positive exposure of 69 million euros to Ireland at the end of March, and a positive exposure of 81 million euros to Portugal under the CEBS method. It calculated these figures including hedging positions.

(Editing by Lin Noueihed)