* Expect to report "good progress" on asset shedding -CFO
* But "low-hanging fruit" is easy part of reduction -CFO
* CFO declines comment on third-quarter business results
FRANKFURT, Sept 18 Deutsche Bank is
making headway in its efforts to cut 250 billion euros ($334
billion) in assets as it adjusts to stricter bank rules, Chief
Financial Officer Stefan Krause said on Wednesday.
"We'll be able to report good progress in the third
quarter," Krause told reporters on the sidelines of a business
conference, adding that the easier, early stages of the asset
shedding plan had not harmed earnings at Germany's biggest
lender so far.
"It always begins with the low-hanging fruit," he said.
Banks are coming under pressure in Britain, the United
States and Switzerland to clamp down on risky investment banking
and comply early with new rules rolled out in reaction to the
financial crisis, in particular the leverage ratio, or limits on
balance sheet size relative to capital held.
Krause said banks' moves to cut balance sheets to improve
the ratio could prompt companies to rely more heavily on capital
markets for their financing needs in future, which in turn
implied greater use of investment banks.
"You cannot simultaneously eliminate investment banks and
slash balance sheets; companies have to refinance themselves
somewhere," he said.
Because German companies typically depend more on bank loans
than their U.S. counterparts, there could be consequences if the
simple leverage ratio that regulators are advocating is brought
in as quickly and at the same level as in the United States,
"In the short term, the identical leverage requirement
cannot be introduced in Europe without damaging the economy," he
Deutsche unveiled its asset-cutting target in July, saying
at the time it could trim the 250 billion euros - equivalent to
16 percent of its total assets - without hurting profit.
The lender's non-core unit alone has about 80-90 billion
euros in assets that were up for sale, Krause said.
Reducing Deutsche's large derivatives book, particularly its
derivatives business with other banks, offered an early
opportunity to cut assets, he said.
Krause declined to comment on business developments in the
He also said there was no news on the lender's planned sale
of its BHF unit to a consortium headed by RHJ International
(RHJI), saying Deutsche was waiting for a decision