Titanic Sub Races Against Time; Deutsche Bank CEO Interview

From the Bloomberg Interactive Burgers Studios. This is Bloomberg day Break for Thursday, June twenty second.

Coming up today, Cruz race to find the missing sub near the Titanic before the air runs out.

The US and India strengthened military and economic ties.

Rates in focus, as Jay Powell appears before Congress again, and the Bank of England makes a policy decision.

I mean bring you an exclusive interview with the CEO of Deutsche Bank.

New York Mayor Adams announces new guidelines after lithium ion battery fires. Plus a New York City board votes for increases in rent stabilized apartments. I'm Michael Barr. More ahead, I'm.

John Stas, Sharon Swarts, the Yankees at three home runs in a widower Seattle, the Mets lost in Houston. The NBA Draft takes place tonight in Brooklyn.

That's all straight ahead on Bloomberg day Break, the Business news you need to starn your day in just one fifteen minute podcast each morning on Apples, Spotify, the Bloomberg Business app and everywhere you get your podcasts.

Good morning, I'm Nathan Hager.

And I'm Karen Moscow. Here are the stories we're following today.

First, we want to keep you updated on the search for that missing submersible near the Titanic. Crews from around the world are zeroing in on underwater noises detected over the past two days. Former Coast Guard Commandant Thad Allen says filtering out the signal from the noise is a tough task.

There's animal life, there are other noises that are out there.

There are ships operating in.

The area, so the question is how to localize it and try and understand what it is.

Former Coastguard Commandant Thad Allen says the situation is growing more desperate for the five people on board the titan The vessel left Sunday with about ninety six hours of air. At this point, they may have just a couple of hours left.

Well, Nathan, we turn to geopolitics now. In an important moment in the US relationship with India, President Biden is hosting India's Prime Minister Narendra Modi for his first ever stayed visit to the White House. Senior US officials say the two leaders will announce a series of defense and commercial deals aimed at improving military and economic times. They'll also hold a brief adjoint news conference, a rare ty for the Indian leader, before Modi addresses Congress this afternoon.

Meantime, in Florida, Karen, the federal government's case against Donald Trump is moving forward. Prosecutors are now turning over evidence to the former president's legal team. Amy Morris has details from our Bloomberg ninety nine to one newsroom.

In Washington.

Evidence is being handed over to the defense as both sides get ready for the August fourteenth trial date, including grand jury testimony of witnesses set to testify at trial, a twenty twenty one recording of the former president discussing having classified information, other public statements made by Trump, an FBI interview of Trump's personal aid and co defendant, and

All right, Amy, thank you well. Elsewhere in Washington, the House is voted to censor Adam Schiff. Flowmakers voted along party lines to center the care California Democrat over comments made during investigations at Donald Trump's ties to Russia. Schiff was defiant ahead of the vote, calling out House Speaker Kevin McCarthy.

McCarthy would spend the nation's time on petty political payback, thinking he can censure or find Trump's opposition into submission, but I will not yield, not one inch.

Adam Schiff becomes the twenty fifth House lawmaker to be censured. He was the lead prosecutor and former President Trump's first impeachment trial.

Karen Let's turn from politics now to financial markets. Jay Powell is back in focus as the FED chair prepares for day two of congressional testimony. Yesterday, Powell told the House Financial Services Committee more interest rate hikes are on the way.

Almost every single of the sixteen of the eighteen participants on the FMC wrote down that they do believe it'll be appropriate to raise rates, and a big majority believes razor rates twice this year, And you know, I think that's a pretty good guess of what will happen if the economy performs about is expected.

Comments come after the FED pause drate hikes last week for the first time in fifteen months.

Well, Nathan. Not all FED officials are on board for more rate increases. Atlanta Fed Bank President Raphael Bostick says he supports holding at the current level for the rest of this year. We get more from Bloomberg's Charlie Pellett.

Bostick says it is prudent to give time for inflation to ease. In response to past moves. In an online commentary, Bostick said, quote, letting restrictive Polsey work for a while is prudent because the Polilsey has been truly restrictive for less than a year, and it takes time from monetary policy changes to meaningfully influence economic activity. In a later Yahoo Finance interview, Bostick said, quote, my baseline is that we should stay at this level for the rest of

Thank you, Charlie. Central banks are also in focus overseas this morning. The Bank of England is expected to raise rates again today, and we get the details from Bloomberg's Ew and Potts in London.

Central banks for men to get boring this summer, but Britain's red hot inflation may force the Bank of England to press hard on the breaks. Today, economists and investors expect the Monetary Policy Committee to push ahead with another quarter point increase in the base rate to four point seventy five percent, what would be the thirteenth rise in the hiking cycle. But core inflation at a thirty one year high, it means money markets now placed a forty

Right you and thanks.

So we have some other central bank decisions in Europe to tell you about this morning. Switzerland hiked rates by twenty five basis points and that amounts to the smallest increase since the SMB started tightening policy last year. And Norway when even further, hiking rates by fifty basis points, that's the largest increase since the central bank's current tightening cycle.

Staying in Europe, Karen Deutsche Bank's CEO is out with an optimistic outlook. Christian Saving says he expects trading results to improve in the second half as clients navigate a complexity challenging economy. Speaking exclusively to Bloomberg, the Deutsche Bank CEO said, there are also challenges facing the business.

With regard to the investment bank, we always said that we had a record year. We had an extraordinary strong year in the fit business in twenty twenty two.

I still think that.

Actually in Q one and Q two we have done well, but the overall market is a bit weaker than in the record year of twenty twenty two.

And again that was Deutsche Bank CEO Christian Savings, speaking exclusively with Bloomberg. State tuned for more of that conversation coming up shortly, and for that look at other stories making news in New York and around the world. We are joined by Bloomberg's Michael barg Morning, Michael.

Good morning Nathan. A deadly tornado hit a small town in northwest Texas last night, leaving significant damage in its wake. The mayor of Matadoras says at least three people had been killed in the storm, which also damaged and destroyed homes and businesses. The dangerous heat wave across the South is turned deadly. The US Postal Service confirmed a letter carrier in Dallas, Texas, died while delivering mail in the heat.

Sure they're staying hydrated, making sure that they're aware of the situation, making sure that they're not staying out longer than they need to.

Near Corpus Christy, it felt like one hundred and twenty seven degrees tenets. In New York City's roughly one million rents stabilized apartments will face increases of three percent for one year leases. After a tense meeting filled with protesters, The city's rent Guidelines Board also voted yesterday for two year leases. Rents will increase two point seventy five percent in the first year and an additional three point two

We need real action not only on the state level, but on the federal level. They have been over one hundred and eight lithian ion related battery fires in this city this year alone.

Mayor Adams also announced an outreach and education campaign aimed at shop owners about the dangers regarding the batteries. The New York State Legislature has passed a bill to protect abortion providers against being sued from states where the practice is banned. The bill would legally protect doctors, ensuring medical providers in the state will be able to provide telehealth services to patients who do not live in New York.

Thank you, Michael. Time now for the Bloomberg Sports Update. Good morning, John Stanshall, Good morning, Nathan.

And Yankees, of course had some big name, high priced guys, they were not the ones that led them to victory at the stadium. Johnny Brido got the start up from the Miners. He pitched it to the sixth and he did not allow a run, gave up just two hits. Yanks had only five hits for three of them left the yards.

The payoff. He's not running in the pitches.

Swung on it ahead of the aditya right that falls high, that is far there, it is gone. It's a two run home run by the Yankee of ours, and that's Jake.

BAUERFA and six home run for Bowers, Billy and mckinne. An other than left handed hitting out field just stuck from Scranton. Hit his second as many nights and later the tenth of the season for the rookie Anthony Volpa. Yankees beat the Mariners four to two and they go for the sweep.

Tonight.

The Mets lost in Houston ten to eight. This game is nine to six. Still in the fourth inning, Tyler McGill gave up five runs. Anthony Leoni followed got only four house gave up four more runs in defeat, twenty third home run for Pete a.

Lonzo with the Mets have.

Now lost thirteen to their last seventeen. Cincinnati has won all of its last eleven, the Reds longest winning streaking sixty six years, and the Giants won again.

They've won their last ten.

Big NBA trade just ahead of Tonight's draft. It takes place at the Barkley Center. Three team deal saw the Celtics acquire the ex Nick Kristaps Porzingis coming in from Washington. It cost them Marcus Smart, a Celtic for nine years two seasons ago, the NBA's top defensive player.

He goes to Memphis.

The draft will begin with San Antonio taking Victor Wembiniama, the French being on. The Nets have back to back picks in the first round, twenty first and twenty second. The Knicks have stockpiled picks in later years. Tonight, barn Atre the Knicks will not have a pick. John Stashedward Bloomberg sports.

From coast to coast, from New York to San Francisco, Boston to Washington, DC, nationwide on Syrias exam. The Bloomberg business app in Bloomberg dot com. This is Bloomberg Daybreak.

Good morning.

I'm Nathan Hager. There's momentum in the business, so says Deutsche Bank CEO Christian Saving, and while he warns of a decline in trading revenue this quarter, he expects results to improve in the second half. Pointing to clients currently navigating a complex and challenging economy. Christian Savings sat down for an exclusive interview with Bloomberg's Guy Johnson. Let's listen into that conversation.

Now, the macro uncertainty that has driven markets so much recently, do you get the feeling that that is beginning to received, Do you get the impression that you are increasingly on more solid ground.

Well, first of all, I.

Think we all have to admit that if you look what has happened over the last twelve to fifteen months in the macro. On the geopolitical side, I think economies have really shown how resilient they are. Because a year ago, a lot of people would have said there is a quite material session in Europe, in Germany, potentially also in the US, and if we now look back, I think we see that the answer we have given is actually showing that we fared quite well over the last twelve

On both sides of the ocean.

And I also do believe Guy that the interest will then stay a little bit longer elevated than potentially a lot of people think. And that means that I still believe that there is a and of a mild recession in the US at the end of twenty three early twenty four, as well as in Europe. You see that Germany is in a technical recession, has been in a technical recession. So I don't believe that we will see a material recession, but I do think that uncertainty still prevails,

So does that mean that the Q two guidance that your CFO gave a few days back was just a was just a blip. He was talking about fixed income being down fifteen to twenty percent. You talk about the fact that the second half is going to see significant uncertainly, that's a good environment for fixed income. So therefore, was the Q two guidance just a blip? And do you still believe that the fullier numbers are going to be better than the numbers that James gave.

Well, let's start with the Oval bank and there we see a good momentum. That is the strategy of Deutsche Bank that we says we need a more balanced bank. That was exactly what we wanted to achieve in twenty nineteen when we called out the transformation of Deutsche Bank.

And we see the results.

We have a very strong corporate bank, a very nice developing private bank, and therefore we can confirm our twenty eight to twenty nine billion of revenues for this year. We see the momentum. We see a Q two to be honest, Q two twenty twenty three from a revenue point of view, which is higher than Q two twenty twenty two. So overall, I would say this bank is

I still think that actually in.

Q one and Q two we have done well, but the overall market is a bit weaker than in the record year of twenty twenty two. But I do believe with some uncertainties, for instance the debt ceiling issue going away in the US, then with the still complex situation which is in front of US, I do believe that in Q three and Q four there is momentum in the business on the fix site. But for us, as a strategy of Deutsche Bank, it's important that we further

We've put a lot of investments into that.

So just to wrap this part of the conversation up, it is going to be it's going to be an operating environment for the fake business that is likely to be less good than next year than last year. Q two may or may not be a blip. You still see uncertainty in the second half of the year, which could provide opportunity. So on balance, the numbers are likely to be slightly better than the fifteen to twenty percent of the James guided too.

That's what I would say for the coming months and weeks. Again, Q two was also a particular quarter given the situation also which we had in the US. We can already see also now in June on the most recent days, that there is a that there is.

Momentum in the business.

So I'm over all actually quite comfortable also with the Fig business. And again Q two was a particular quarter. I would say that the Fig business in Q three and Q four I think there was a slight recovery.

You are very good at keeping secrets.

Let's talk about the new Mist acquisition for those of us to follow the bank, it caught us all by surprise. I understand you've been working on it for quite some time, but it definitely caught us by surprise.

Was the offer just too good to refuse? Was the price just too good to refuse? Where did it come from? Where did where did your decision to go in this.

Direction the advisory business come from?

Well, I just said it in my previous answer. You know, I'm a big believer and the whole management team of Deutsche Bank is a big believer that we need balanced business not only for the Oval bank. That was the reason why we did the transformation four years ago, stable well balanced set up with four businesses. In each of those business I again want to be balanced, and we have a very strong thick and DCM business. Where we wanted to further invest is in the o NA business.

Time and yes we kept the secret quite well.

And we think it's an optimal addition to our business mix and to our offerings in Europe and in particular in the UK. The UK is from a fee market pool, it's the most lucrative European market. We are adding one hundred and seven top corporate lines and it fits beautifully to our global house bank concept. Everybody is only thinking about the investment banking offering, and yes that's obviously something we are very much interested in and it fits to

Can also do the one or the other things.

So the over global housebank concept is fitting very well to Numis and therefore we looked at it very carefully. I'm very glad about the job Fabrizio and the.

Team have done.

And now we concluded this and now we need to make the final steps.

Right. Are you keeping more secrets from me?

Are there you talk about the other divisions and the fact that you want to have balance. Are there other deals in the offering? Even another great opportunity came along. Are you still interested or or is the dry powder gone?

No?

I would say, look, I think we are very careful and cautious planning team. But of course we always said that after restructuring and positioning this bank, we are up for growth and we always says we want to grow in more capital lighted products, which is for instance the o NA business in m and a business in the advisory business. But you have also seen that we have done senior hires again in corporate finance, but also in

And hence a I wouldn't.

Tell you about secrets because you just said we are good at it at keeping it, but that there is a clear growth strategy in parts like wealth management, origination and advisory. Yes, we are focusing on that. And with the recent HighRes we've seen that.

You talk about highers on the well side, though, do you see the growth there being organic? Do you see it being via acquisition of talent rather than acquisition of businesses?

Well, it's it's it's both.

But I do believe that we have now such a nice positioning and and such a nice structure that we really do believe that if you have a chance to acquire and and get good and great talent in all kinds of regions, this is a really good way in step by step growing your business. Claudio Desunctis has done that very successfully in Asia in other parts of southern Europe.

So that is the first way of growing.

If Commons Bank ever came back, would you be interested in that acquisition. They have got a huge deposit base which in this environment is hugely attractive.

Well, we also have a huge deposit base. Together it will be even bigger. Yeah.

But I think we have shown also during the recent volatilities in the market how firm and how stable our deposit base is, so that is not a reason to actually think about further enlarging it or acquiring somebody else. I think the full focus of Deutsche Bank is in now after successfully delivering the transformation over the last three or four years, is now growing into an area where we have a returnal equity of larger than ten percent in twenty twenty five. We are on a good way

This is Bloomberg Daybreak Today, your morning brief on the story's making news from Wall Street to Washington and beyond.

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