what can john cryan say to reassure the markets?o: i would imagine that he's not going to reinvent this restructuring program that he has started late last year. but still, regarding the global markets unit, there's been some debate, whether deutsche bank organizationally split that from the investment banking division last year, people are thinking maybe this is a bit of a precursor to some much more aggressive cuts to that unit. i guess giving a commitment that it is and remains core to deutsche bank is certainly a significant step. francine: will it be enough to reassure the markets? they are shrinking businesses, a lot like their rivals, like credit squeeze. there's not much good news coming out of it. how do you get a to do -- give a definitive, we are on track, we are not going bust? deutsche bank certainly has a lot to prove at the moment. my take would be that it is now a matter of study, gradual implementation of many of the steps they have outlined. at the heart, it is essentially a cost-cutting program, making progress on

the experience restructurer john cryan becomes chief executive. >> with all caution, i say we can see to our legal problems. reporter: cryan is optimistic several court cases will be bound up this year, but that means right now deutsche bank is still taking care of its past rather than looking to the future. reporter: shareholders may be voicing displeasure with deutsche bank, but whether their voices are heard is another matter entirely. the results of the votes do not oblige the bank to do anything, but perhaps co-ceo john cryan, set to become the sole ceo of the bank, would be wise to listen. after all, he has artie been warned deutsche bank could face another year in the red -- already been warned deutsche bank could face another year in the red, and that could mean he could ask investors to buy up more stock as he looks to drum up capital buffers that the bank so needs. reporter: german chemicals giant bayer is launching a takeover bid for monsanto. it has artie met with management at the u.s. firm to discuss. monsanto has a market cap of $42 billion, and reviewing the proposal.

cryan came out fairly emphatically.ohn cryan saying he thought it was ridiculous for moody's to downgrade their debt just two steps above junk because, in his words, they have enough capital to pay their debt four times over. >> does mr. cryan have a point? the bank has never had as much capital. they could easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of operating environment, and its results have been in -- its operating results have been in decline for the past couple of quarters. so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: the turnaround has many elements in it. it has been a very disciplined execution by the new management team. what they are trying to do is change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platform.

cryan came out fairly emphatically after this downgrade.ohn cryan saying he thought it was ridiculous for moody's to downgrade their debt just two steps above junk because, in his words, they have enough capital to pay their debt four times over. >> does mr. cryan have a point? the bank has never had as much capital. it could easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of the operating environment, and its operating results have been in decline for the past couple of quarters. and so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: well, the turnaround has many elements in it. it has been a very disciplined execution by the new management team. what they are trying to do is they are trying to change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platfor

cryan came out fairly emphatically.ohn cryan saying he thought it was ridiculous for moody's to downgrade their debt just two steps above junk because, in his words, they have enough capital to pay their debt four times over. >> does mr. cryan have a point? the bank has never had as much capital. they could easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of operating environment, and its operating results have been in decline for the past couple of quarters. so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: the turnaround has many elements in it. it has been a very disciplined execution by the new management team. what they are trying to do is change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platform. they are trying to do all of

three main problems facing john cryan. the slope investment banking and trading has not helped his come back. the negative interest rate policy here and in asia are not -- is not helping the banks policy regardless of what mario draghi may suggest. these lawsuits, they have paid up $14 billion since 2012. that could get bigger. john cryan has said that is one of his main focus is is putting a stop to one of the big losses this year. first quarter profit fell 61 percent. when we were here last year, john cryan said he may have another loss this year. a second annual loss, there are a lot of problems facing him. the most interesting thing will be sit -- will to see -- if we get a turnaround in the slump and if this zero interest rate policy actually is helping banks as draghi has suggested. guy: matt, thank you very much indeed. remember we are watching unicredit today. will he be there at the end of the day? coming up later, we are going to be talking in an interview with berkeley's ceo, just daily -- -- jess ceo, just dail

martin gilbert: john cryan probably at deutsche as a tough job.as a good manager he can fall back on. think they have all got good bits, and they have all got investment banks. they are probably trying to downsize. francine: there is a lot of speculation about selling. would you ever step down? martin gilbert: i have never tried to sell the business, but we do get a lot of people wanting to buy us, which is very nice. so far we have managed -- francine: europeans? everywhereert: around the world. asset management is a great business because of the return on capital is so high, it is profitable, it is predictable. there was a lot of interest. being independent from assets, a massive benefit to us. francine: thank you very much. martin gilbert: thank you very much. ♪ ♪ narrator: the contemporary art world is vibrant and booming as never before. it is the 21st century phenomenon, a global industry in its own right. "brilliant ideas" looks at the artists at the heart of this. they have a unique power to nspire, astonish, provoke, and shock, to push bo

cryan have a point? the bank has never had as much capital.easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of operating environment, and its operating results have been in decline for the past couple of quarters. so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: the turnaround has many elements to it. it has been a very disciplined execution by the new management team. what they are trying to do is to change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platform. they are trying to do all of these things, and all of these things, if they were achieved, we thi would actually be credit positive. but they are challenging to achieve them all. shery: yahoo! having its award space since early january, falling 5%. telecom giant at&t is said to be interested in buy

martin: i think john cryan over has a tough job. tidjane has a good manager he can fall back on. all got good bits and they have all got , investment banks they are probably trying to downsize. martin, there is a lot of speculation about aberdeen's future. would you ever step down? [laughter] martin: i have never tried to sell the business, but we do have a lot of people wanting to buy us, which is very nice. francine: europeans? martin: everywhere around the world. as if management is a great business because of the return on capital is so high. it is profitable, it is predictable. there is a lot of interest. being independent from assets, a massive benefit to us. francine: thank you very much. martin gilbert: thank you very much. ♪ ♪ >> this place seems like make-believe, or perhaps the fever dream of a design blogger. no one in their right mind would build a hotel in a forest, and stick the rooms up in some trees. but then again, it sort of fits perfectly. because this is sweden. in the treehouse hotel loses swede.

why aberdeen thinks it goes to joh john cryan.looks like we will have a fairly positive open, around half of 1% higher. we'l talk about vodafone, about hugo boss, but the general tone in the market is a little bit more positive. we're up around 6/10 of 1%. here's the market open with caroline hyde. caroline: we are waiting for them to get galvanized. keep an eye on germany as it reopens. ftse called higher. we could be seeing the rally after the united states is bucked by oil prices going higher, and noticeably the technology stocks in rome. stocks increased by market capitalization at a debt of $18 billion. we are higher on the stoxx 600, up 3/10 of 1%. telecom services up, this is the imap function. you can see which industries are on the move in europe. the downside, consumer staples. performins not performing quites well. john cryan is having a challenging time, but oil has been helping to drive asia higher, and let's check in on oil, because we haven't seen the sorts of levels in the brent contract all the way back to six mon

your vote of confidence for john cryan, for paul at lender? >> we vote against the old management as we believe over the last decade many things went especially from the new ceo who is in the right position, the right man to restructure the bank. chairman, you are going to vote for him as well but with reservations? >> yeah. overall, the supervisory board did a good job as they reshuffled. in addition, their exchange dimension last year -- some dark , a dismissalpast that should be done internally and not by the media. in general, in our opinion, they did a good job. matt: you are going to hold a speech in there, pointing out they did three capital increases and yet their market cap has shrunk to $20 billion. do you think they need another capital increase? will you address that? >> time will tell. overall, for investors, when you invest in capital increases and the stock is only about 20 million -- we have to wait and see -- we have to wait and see what is going to happen and also have the restructuring is going, then we have to decide what's

cryan's new, he has to cleaned up. the management.-t she has to clean it up he has to clean it up, the management. win over thean doubters? it does seem like he made a positive impression on not ,nly the large shareholders some of whom we just heard from, but definitely from the smaller shareholders as well. the germans have traditionally urine for a german ceo. yearned for a german ceo. a swiss man took over. there have been concerns that the bank was not as worried about germany. , who isohn cryan british, spoke very good german and refer to germany as the homeland. the most positive thing by far they said to shareholders today, they will not be needing a capital raise. that has been the concern for the big investors. they raise capital three times for $22 billion and the market cap is the less than that right now. less than that right now. the fact that he says they can make it through this restructuring year without increasing capital is very positive for shareholders. were shareholders encouraged by the fact that he is committed

cryan came out fairly radically after this downgrade, matt.fter this downgrade, matt. matt: john cryan saying he thought it was ridiculous for moody's to downgrade their debt just two steps above junk because, in his words, they have enough capital to pay their debt four times over. >> does mr. cryan have a point? the bank has never had as much capital. they could easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of operating environment, and its operating results have been in decline for the past couple of quarters. so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: the turnaround has many elements to it. it has been a very disciplined execution by the new management team. what they are trying to do is to change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology p

michael: that was john cryan's counter.ital front, deutsche bank has gotten past its fears from earlier in the year. they seem to have a stable capital ratio that has moved around a little bit. moody seem to call out a lot of the profitability issues, which historically have been equity holders's concerns. bankss given that deutsche has so much losses from the legal side over the last few years, perhaps that becomes an issue for the creditors. alix: one john cryan says we have enough capital to repay all of our debts four times over, is he mistaken or is this a different kind of accounting thing? ishael: i think part of it that outlook going forward. if you think that the legal issues are not over, which they certainly aren't, but it depends on the scale you are expecting going forward, that could be the divergence there. john cryan has talked about getting the bank to a spot where it is not having these existential questions where it becomes more of a probability question. he seems to think they have gotten to that point w

cryan came out fairly emphatically. >> john cryan say he thought it was ridiculous to move the downgradeo steps above words, they, in his have enough capital to pay their debt four times over. they could easily repay their debt many times over. is that a valid argument? >> the rate action was about the increased headwinds the bank is facing in terms of operating environment and its results have been in, its operating results have been in decline for the past couple of orders. -- quarters. that is what drove the rating change. what is the biggest challenge for deutsche bank in achieving this a turnaround? peter: the turnaround has many elements in it. they are trying to change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platform. they are trying to do all of these things, and all of these things achieved would be quite positive. but they are challenging [indiscernible] its award space since early january, falling 5%. is set to bet buying the internet business. why did at&t come back into the gam

scarlet: john cryan is disappointed that moody's has cut the credit rating.e finance ministers hope to unlock bailouts for greece. are they tried to drag out the saga? no, it's not 2011. scarlet: let's check in with julie hyman at the markets desk and we are approaching session highs. julie: it is not 2011 in the stoc

the chairman got a lot more criticism than cryan. cyran has been there less than he year. think people want to give him some time to try to turn this around -- he has been there less than a year. francine: we will get back to the banks of the volatility. quick update on what we have heard in the last 15 minutes. the egyptian presidency has commented in an e-mail statement about the egyptair plane that went missing 48 hours go. egypt has offered its condolences to families of people, passengers on the egyptair flight. we still don't know what has happened to those 66 passengers on board of the flight from paris to cairo. we will have plenty more. in the last 10 minutes we understand from the military they may have found part of the wreckage. we will update you as soon as we have more breaking news. ♪ francine: welcome back. it is "surveillance." tom, this is what i pigged out for my morning must-read. my morningut for must-read. the financial times is talking about the ongoing powers mr. erd ogan is taking. face of uncontrolled trafficking, angela merkel e.u. institutions t

john cryan accusing the bank of hiding something, saying that is absurd.investors believe it, do we believe in it, do you believe him? john is putting his reputation on the line. he has a great reputation as an investment banker and as the cfo. people are giving him a lot of credit for that. how long that lasts, i'm not sure. the behalf of the president and the united states of america, i apologize for our security system at the airports. christopher: given what is going on today, i shouldn't be complaining. tom: yes. safe travels. atlantic equities and european banks. coming up, michael mckee in an important interview, more important after the minutes yesterday. jeffrey lacher of the richmond fed. this is bloomberg surveillance from london and new york. ♪ francine: that is the french foreign minister speaking at an impromptu news conference after meeting with the families of people on board. saying 56 people were on board. it is a fluid operation. we know there is a search and rescue operation under way. 16 of those on board were french citizens. it was 2

john cryan speaking excellent german.as very surprised when he referred to german -- germany as the homeland. of course he is a britt. shareholders that went into the meeting, angry because the shares of them cut in half, seemed really pleased. they seemed really impressed after the speech and the q&a session that followed. we had these headlines. the ceo of ubs, he was making comments about smaller banks in europe saying he does not think all of the banks in europe are going to survive, especially the smaller ones getting hit hard. guy: this is an interesting point. look at what is happening in the global banking sector. i am not saying we are going to see deutsche becoming one of those. you look at what is happening in europe and you think about the banking sector and you think about the u.s. economy is surging ahead because it has better capitalized banks. let's get tapan datta's comments. europe's have -- europe has too many weak banks. is merging some of these institutions the way to go? tapan: yes it is. i think we

what is in store for the co-ceo, john cryan today?k john not have such a difficult day, since he is new here, he has got to be the guy. investors have to stick with him if they want any chance of survival. nick comfort is about to spend the next 12 hours with shareholders who have lost half their money in the last year. what are they going to be able to do about it? >> today they can voice their complaints to the previous management, the chairman. and -- and they're not so much voicing criticism of him as demanding that he deliver on his pledge, that he shrink the balance sheet, cut costs, and bring the bank back. matt: this is understandable because of the massive losses and the continued lawsuits, but if they are focused on just cutting staff and possibly even cutting remuneration, what does that leave for clients to use as a resource? why would you choose this investment banking few knew they were all leaving? >> good question. it's a clear competitive disadvantage to be restructured during the market rout. they are probably very u

john cryan has another headache with mood is cutting the banks rating to just two grades above junk. ratings agency says which is performance sing -- performances has been week -- says deutsche's faces economic uncertainty. lacquaned for francine who will be speaking to jes sta ley. do not miss it. mark phelps is here. charti want to show you a . this is the stoxx 600 90 industry groups you to date. bottom of the pile. 19% lower. what does it take for you to get enthusiastic about european banks? >> we find it quite challenging to invest in banks and we try to do fundamental work. interactive.is -- attractive. i find it hard to look at banks because we just all know. what we are seeing here is the fact that there is a tremendous amount of challenges the bank faces, particularly our negative interest rate environment which make it very hard for profitability. the regulated are consistently changing what their requirements are. they have cut significant cost that they have to deal with. have challenges in regard to what is going on in the political environment in europe. it is difficul

. >> i think john cryan at deutsche has a tough job. i think tijian has a very good wealth manager that he can fall back on. barclays has a very good retail bank, with good return on equity. i think they have all got good bits, and they have all got investment banks that they are probably trying to downsize. francine: and after its best quarter since 1986, can gold continue to shine? george soros think so. plus, it has been secret for more than 40 years. we reveal how much of the u.s. national debt is owned by saudi arabia. ♪ francine: welcome back. let's get straight to the bloomberg business flash with nejra cehic. nejra: vodafone shares are higher this morning after reporting quarterly sales growth on its network that be estimates. the wireless carrier said organic service revenue, which includes customer fees that excludes handset sales, rose 2.5% in the three-month period through. march 31 analysts surveyed expect it will .5%. that was helped by improve results in several key european markets. shares in taylor wimpey have junta thi

junk ryan goes in front of investors today. -- john cryan goes in front of investors today. 1.1191.etting today's session on the back of a .trong u.k. retail sales print the story of the last 24 hours of the last week has been the bond market. we discussed a flat yield curve. you saw treasuries across the .urve start to sell off we are up a basis point of a 10 year to 1.86%. that is the situation. let's get the julie hyman for stocks. julie: let's start with walmart which is seeing a big towns in premarket up by 8%. it is a retail earnings we have gotten over the past couple of weeks sentiment going into this report was poor. walmart shares were down 4% yesterday along with target it's disappointing numbers. walmart looks like even more of a surprise. earnings share beating by $.10 versus analyst estimates. report to say the least from walmart. that.ares are reflecting we have a number of deals and potential deals to talk about this morning. officials unsolicited takeover offer from monsanto. details of this deal are not being made public but monsanto does have a market value of $42

cryan has a very tough job. he has a very good wealth manager that he cannot fall back on. they have all got good bits. they have all got investment banks that they are trying to downsize. haidi: the japanese prime minister shinzo abe still expects to raise the japanese tax, unless they are serious reasons not to. he told lawmakers he would make a final decision on the hike within the appropriate time. he first said it would delay the increase, as it would threaten related to deflation. global news 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. you can find more stories on the bloomberg at top . anna? anna: haidi, thank you. germany's equity and fixed income markets were closed yesterday for the holiday. they reopened this morning. now, let's get the equity markets up and running. we are now joined from berlin by bloomberg's matt miller. you still have to go up to nine years to find a positive yield. give us an update on how things opened up, matt. matt: a selloff was what we saw here at the open seven minutes ago. that was a

this takes place tomorrow and the ceo john cryan will have to face the pressure from disconcerted shareholdersey will certainly be connected. if you look at deutsche bank's price to book ratio, you will see the stock compared with other investment bank peers, is massively undervalued. -- oronly trading at .3% i should say, .3 of its book value. every other one of the top 10 investment banks, not just in europe, but in the world, is trading at a much higher valuation. sasksoll, the cio of bank. all of the things seem to be trading under book values. >> the two key drivers are the u.s. dollar and the banking sector's performance relative to the performance. we are down in japan because of the negative interest rates in europe, and even int h the ua. clearly, the ability of the banks to rate capital is deteriorating day by day. the outlook for banks is under huge challenges, technology being one and regulatory framework being another. and of course, it has taken them so long to clean up what they want to do in terms of the strategy. deutsche bank is in their third strategy of the last three years

david: all eyes are focused on john cryan.s ability to make a difference or how much or is he just going to ride out the storm? oskana: i do not really want to be speculating, but deutsche a negative beard since the crisis, so perhaps it of its own ande it is a european bank, so the issues that are somewhat over the issues in europe overall and wall ofay add to that worries. specifically for john cryan, yes, it has to return to profitability and how is that going to happen when regulators are so focused on all banks? and the interest rate environment is emitted. ahead of number two, the open, the direction of the chinese currency. it is down at 1.2% amid a potential rate hike and the u.s. a dangerous streak that has not been seen since january. if you look at what is happening with the chinese currency, reports of "wall street journal" said that they will abandon a market-based approach. that will make your life a lot more difficult. where does that currency go? oskana: life in fixed income in general has not been easy. we hav

john cryan says the bank is very disappointed by the cut and the bank could easily repay its debt manyimes over. hackers may have targeted more banks than were previously reported according to the ceo of swift. hackers exploited weaknesses and how banks connect to swift to still $81 million from the bangladesh central-bank. they are boosting security members -- measures. costs toeing hurt by prepare -- repair a chip factory damaged by an earthquake and they are facing a drop in demand for smartphone components. that is the bloomberg business flash. tom: madura, thank you so much nejra, thank you so much. we need to bring in simon theedy, who has darkened doors for the intrigue that the governor faces, particularly given the referendum, eu referendum. does it color and shade everything now? simon: pretty much. mark carney is likely to find that again today. they are more likely to quiz him on brexit and the bank's role. tom: what you have done for years is linked in financial and banks into our broader economics. fold in the eu banking tension and what the british banks are facing as we

.: it also raises for john cryan the legal and compliance issues. he can't get these behind him. i thought was critical is that he has the investor backing. 98.5% backing in the vote. that is absolutely critical. that is what toppled anshu jain last year. investors were not behind him at all. if you have a strategy, that is one thing. if you have lost half the market value of the company, that is another. if you want to get a strategy through, you need that backing. david w.: good for him. mine had to do with cars. it turns out that a third of people trading in their cars, the car is worth less than is owed on the loan. which is a big issue. this is a big issue for car companies. it affects demand for new cars. lisa: this is fascinating because a lot of people say, car loans are better than mortgages because people will pay them off the four they pay off their mortgage debt or other debt. they may have less recourse to resell their new car. david w.: in order to get people to buy the cars, they have stretched out the payments for a longer period of time. jon: it is a recalibratio

cryan. mr. gilbert said the same thing. one of the hardest jobs in banking.'s the story for tomorrow. coming up later in the day, 10:30, betty liu and alex sherman speaking with tom rutledge. 2:00 p.m., fed minutes from the april meeting. about 26 minutes into the session. stronger dollar story. all of that ahead of the fed minutes. ♪ betty: 10:00 a.m. in new york am a 3:00 p.m. in london. live from new york, i'm betty liu. mark: i mark barton. this is bloomberg markets on bloomberg television. betty: we will take you from new york to london to boston in the next hour. shares of target are tumbling after first-quarter sales missed analyst estimates. the discount chain delivered a disappointing forecast. we will preview the latest fed minutes which come out a bit later area at how concerned is janet yellen about a potential brexit? will it affect the fed interest rate decision next month? betty: we will talk with charter communications chairman and ceo tom rutledge as he completes a $55 billion purchase of time warner cable. what will that mean for the future