HNA Cuts Stake in Deutsche Bank as It Continues to Unload Holdings

By Jenny Strasburg

HNA Group Inc. has cut its stake in Deutsche Bank AG to 7.9% from 8.8%, the Chinese conglomerate disclosed Saturday, as it continues to unload its overseas holdings.

This comes after HNA spent billions of dollars in financing and complex derivatives in 2017 to build its stake in the struggling German lender, becoming Deutsche Bank's biggest shareholder with a holding of just under 10%.

Since that position was disclosed almost a year ago, Deutsche Bank shares have declined by more than 30%. They traded Friday around EUR11.57 in Frankfurt.

An HNA spokesman said Saturday the company "decided not to renew a part of the financing structure for our stake in Deutsche Bank," citing "the current market environment." The stake cut was disclosed in a regulatory filing.

HNA is committed to remaining "a major investor in Deutsche Bank," the spokesman said.

The conglomerate had previously said it didn't have plans to reduce its Deutsche Bank stake. Deutsche Bank didn't immediately respond to requests for comment.

The Chinese company has been selling off billions of dollars worth of real estate and other assets after a global acquisition spree left it cash-strapped and pressured by banks to reduce financing.

Deutsche Bank has been dogged by consecutive full-year losses and questions about its investment-banking strategy. The lender dismissed Chief Executive John Cryan earlier in April and replaced him with Christian Sewing. Mr. Sewing has been with the company more than two decades in risk and audit roles and most recently ran the German-centric retail, private and commercial bank.

The CEO shake-up sparked other high-level departures. Deutsche Bank is scheduled to report first-quarter earnings April 26.

Write to Jenny Strasburg at jenny.strasburg@wsj.com

(END) Dow Jones Newswires

April 21, 2018 10:22 ET (14:22 GMT)

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