"Worst banks crisis" says Deutsche CEO

LONDON (Reuters) - Global credit markets are deep in the worst crisis of Deutsche Bank (DBKGn.DE) chief Josef Ackermann's 30-year career, but he does not see any further writedowns for Germany's flagship bank.

"If you go back to the Asian crisis, the Latin American crisis, the Russian crisis, these were pretty regional," said Ackermann, who also heads global banking organization the Institute of International Finance.

"(This) is psychologically the worst crisis that I have seen in my 30 years," he told journalists at the Reuters Finance Summit.

"What is really new and unexpected is that we had a phase of excessive liquidity. It is not a shortage of liquidity. It is a shortage of demand. The liquidity was hoarded under the pillow."

Deutsche's shares, which had been trading almost 2 percent lower, turned into positive territory after Ackermann predicted no further writedowns beyond the 2.2 billion euros ($3.2 billion) it took in the third quarter.

"We said that we have taken the proper markdowns and given the situation yet we do not see further markdowns," he said.

Shareholders were also pleased to see him stand by his goal next year of a pretax profit of 8.4 billion euros ($12.3 billion).

"This is ... a remarkable statement given news flow over the past week of writedowns at Credit Suisse and Morgan Stanley," said David Williams, an analyst with Fox-Pitt, Kelton.

Investor confidence has been battered by the credit crisis, triggered when high-risk U.S. home owners failed to make their mortgage payments.

This week, Morgan Stanley (MS.N) announced a $3.7 billion hit from investments linked to risky subprime mortgages, and the crisis has cost the bosses of Citigroup (C.N) and Merrill Lynch MER.N their jobs.

Citi, Merrill and Morgan Stanley alone have made $24 billion of subprime writedowns in the last month.

Ackermann said a question mark remained as to which parts of the banking business would be affected in the long term by the recent shake-out.

"I don't think the leveraged loan issue is the big issue," he said. "That is under control. The much bigger challenges are on the other side. What will happen in terms of prices ... in the trading portfolio? And what is the longer term impact on certain businesses?"

OPPORTUNITY FROM CRISIS

Ackermann said that the Frankfurt-based group was already sifting through the wreckage left by the credit storm for new ways of making money. "To buy some of the good quality assets at cheap prices and package them into a distress portfolio, that is something you can do now," he said.

"That is a tremendous opportunity for investment banking. That is very good for us in terms of business model."

Ackermann also warned that the U.S. dollar was nearing levels that will hurt European businesses and complicate the European Central Bank's monetary policy.

"I think we are getting close to a level where European business is really feeling the pinch," Ackermann said just a day after the euro soared to a record high of $1.4730, and ahead of the European Central Bank's decision later on Thursday to leave interest rates unchanged, the Deutsche CEO said Ackermann said.

"Then of course it will be very difficult for the European Central Bank to stick to a completely stability-oriented monetary policy."

Ackermann also said he doubted that $100 oil would kill off economic growth "From a cost perspective I don't think that ($100 oil) will be a huge difference. It signals that the economy is robust, otherwise we'd see different price levels," he said.

He declined to comment on a report he may be among the candidates to take over as new chief executive of Citigroup.

(Additional reporting by Anshuman Daga, Jane Merriman, Peg Mackey, Andrew Hurst, Richard Barley, Peter Starck, and Mike Dolan; Editing by Andrew Callus)