UPDATE 1-Deutsche Bank fires first shot in rush for capital

* Deutsche Bank mulls cap hike of up to 9 bln euros -sources

* Capital increase could enable Postbank takeover – sources

* Helps strengthen balance sheet for Basel III – sources

* Deutsche Bank shares indicated 3.8 percent lower

* Deutsche Postbank shares indicated 4.2 percent higher

(adds detail, background)

FRANKFURT, Sept 10 (BestGrowthStock) – Deutsche Bank (DBKGn.DE: )
shares were indicated sharply lower on Friday after sources told
Reuters Germany’s biggest bank may raise up to 9 billion euros
($11.43 billion) to bolster its balance sheet and war chest.

Deutsche Bank’s move would enable Germany’s flagship lender
to bulk up as tough new capital requirements for banks are
finalised and pave the way for a takeover of Deutsche Postbank
(DPBGn.DE: ), two people familiar with the matter said.

Deutsche Bank declined to comment.

Its shares were indicated down 3.8 percent before the German
market opens at 0700 GMT, while Postbank shares were seen up 4.2
percent.

“This reinforces worries about the health of European
financial institutes,” Close Brothers Seydler wrote in a note to
clients.

Deutsche Bank’s plans have not yet been formalised but such
a move — which one source said could come as early as next week
— could help it tap markets ahead of a raft of rivals which are
expected to raise capital as well.

German lawmakers quoted European Central Bank Executive
Board member Juergen Stark this week as saying German banks are
undercapitalised and the German banking system will have to
change. [ID:nBAT005656]

The 10 biggest German banks may need 105 billion euros in
fresh capital under so-called Basel III capital rules set to be
adopted this weekend, the German Banking Association has said.
[ID:nLDE6850Q9]

The timing of Deutsche Bank’s potential capital increase was
uncertain. Another source said a share issue could take several
weeks.

Deutsche Bank is sounding out investment banks about the
capital increase, one source said.

Consolidating Postbank would give Deutsche Bank access to
Postbank’s 14 million clients and help diversify its business
away from the volatile earnings of investment banking.

Deutsche Postbank Chief Executive Stefan Juette told a
banking conference on Thursday he did not know when or whether
Deutsche Bank would increase its stake [ID:nLDE68816D].

For analyst views click on [ID:LDE689081]

(Reporting by Edward Taylor, Philipp Halstrick, Alexander
Huebner and Christoph Steitz; Editing by Michael Shields0

UPDATE 1-Deutsche Bank fires first shot in rush for capital