July 26, 2011 / 3:50 PM / 8 years ago

Deutsche Bank cuts peripheral exposure by 70 pct

* Deutsche Bank exposure to five peripherals at 3.7 bln eur

* Cut exposure to Italy to 997 mln euros vs more than 8 bln

* Spain exposure down by more than half at 1.1 bln euros

* Greece exposure fell to about 1.2 bln euros from 1.6 bln

FRANKFURT, July 26 (Reuters) - Deutsche Bank AG (DBKGn.DE) cut its exposure to five peripheral euro zone countries by about 70 percent to 3.67 billion euros ($5.3 billion) amid concern that Greece’s debt crisis could spread.

The German flagship lender cut its exposure to Italian sovereign debt to 996 million euros at the end of June from more than 8 billion six months earlier, it said on Tuesday as it reported second-quarter results.

The lion’s share of those bonds came from Deutsche Postbank DPBGn.DE when Deutsche Post became its majority owner in December.

The lender also protected itself against risks in Italy with credit default swaps. A spokesman for the company said the move did not imply that Deutsche Bank planned to cut back its operating business in Italy.

Deutsche Bank’s exposure to Spain fell by more than half to 1.1 billion euros and to Greece to 1.2 billion from 1.6 billion.

The bank said it had not sold any Greek bonds, as promised, but rather took a 155 million euro impairment on Greek bonds held in its banking book, equivalent to the 21 percent loss private creditors agreed to take on their bond holdings as a contribution to rescue package for Greece. (Reporting by Alexander Huebner and Philipp Halstrick; Writing by Maria Sheahan; Editing by David Holmes) ($1=.6909 Euro)

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