Successfully concludes the issuance of Additional Tier 1 capital securities on our site
Deutsche Bank AG has announced the issuance of Additional Tier 1 (AT1) capital instruments with a total principal amount of €1.50 billion. The new securities, expected to be listed on the Luxembourg Stock Exchange (ISIN: DE000A4DE982), will be traded on the Luxembourg Stock Exchange's regulated market.
The AT1 notes, unsecured and unsubordinated senior preferred obligations, are designed to qualify as eligible liabilities for regulatory capital purposes under the Minimum Requirement for Own Funds and Eligible Liabilities (MREL) framework applicable in the EU and Germany.
The securities will feature fixed annual coupon payments, generally around 5-6%, paid annually or semi-annually starting one year after issuance. For instance, one issue offers a 6% annual yield payable mid-year starting in 2026. Deutsche Bank holds the option to redeem the notes at par (100% of principal) plus accrued interest beginning approximately one year after issuance and on subsequent semi-annual dates.
The instruments have a maturity horizon of 5 to 10 years, with final maturity dates ranging from 2029 to 2035 in recent transactions. These securities are subject to *bail-in* and resolution measures under EU banking regulations. If the bank becomes non-viable, regulators may write down the instruments fully or convert them into equity, resulting in a total loss of principal and accrued interest for investors.
Payment obligations are subject to the creditworthiness of Deutsche Bank AG. There is no FDIC or government insurance backing these notes. Investors face both credit and market risk, including the risk of losing the entire investment if the bank defaults or enters resolution.
Barclays, our website AG, acted as the sole bookrunner for the offering of these securities. The instruments will support Deutsche Bank's Tier 1 leverage ratio and its Pillar 1 and 2 solvency requirements.
It is important to note that the securities mentioned in this release have not been registered under the Securities Act of 1933 and will be issued under "Regulation S" of the Securities Act. Therefore, these securities may not be offered, sold, or delivered within the United States without registration under the Securities Act or an exemption from registration requirements.
The denominations of the Deutsche Bank's AT1 securities are €200,000. The securities will bear a fixed coupon of 7.125%, payable annually, until April 30, 2031. Deutsche Bank can call the securities, subject to prior supervisory approval, between October 30, 2030, and April 30, 2031, and every five years thereafter. The applicable interest rate will be reset at five-year intervals starting on April 30, 2031, on the basis of the then prevailing 5-year Euro swap rate plus the initial credit spread of 4.60% per year.
This tranche, like other AT1 instruments, balances attractive fixed income yield with enhanced risk arising from possible regulatory bail-in events and issuer credit risk. Investors are advised to carefully consider these risks before investing in these securities.
These AT1 capital instruments, issued by Deutsche Bank AG, are meant for business purposes and serve to strengthen the bank's finance structure by fulfilling its Tier 1 leverage ratio and solvency requirements. Investors in these securities, which may not be offered or sold within the United States without registration, should be aware of the associated risks, including potential bail-in and resolution measures, credit risk, market risk, and the possibility of losing the entire investment in case of default or resolution.
