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‘Potential bubbles’ in financial markets already exist, warns Deutsche Bank CEO


Mario Draghi, President of the European Central Bank (ECB), speaks to the media following a meeting of ECB leadership at the European Central Bank on January 10, 2013 in Frankfurt, Germany.

Hannelore Foerster | Getty Images

Mario Draghi, President of the European Central Bank (ECB), speaks to the media following a meeting of ECB leadership at the European Central Bank on January 10, 2013 in Frankfurt, Germany.

Yet, certain markets now seem to be at particular risk of potentially overheating, according to the Deutsche Bank chief who assumed the top job (initially as co-CEO before becoming sole head) at the German lender in July 2015. Cryan has navigated the bank through a brutal two years of trying events such as restructuring, job cuts, legal settlements and hefty fines.

“If you look at the higher risk end of the market, I don’t think you get the right reward for the risk you’re taking right now,” Cryan observed.

“So in some of the riskier credit markets – particularly in the U.S., not just in the U.S. though – I think I would be much more cautious about investing and I wouldn’t blanket invest – I’d be much more diligent about picking the right security or the right loan to invest in,” he added.

Turning to Thursday’s impending European Central Bank (ECB) meeting, which is being closely watched for hints on a potential withdrawal of its extremely easy monetary policy, Cryan noted that the regional currency reflects the expectation of a “gradual” change in interest rates.

“I think that’s being anticipated a little bit in the market,” noted Cryan.

“So it’s not a perfect storm but it’s two factors coming together. One is more confidence in the economy, the other is more confidence that the currency itself, technically, might be worth a bit more,” he concluded.

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