The New York State Banking Department on Thursday approved Deutsche Bank AG's plan to buy Bankers Trust Corp.
The $10.1 billion deal, which was announced Nov. 30, now awaits one last approval, from the Federal Reserve Board. As of midday Thursday, the Fed had not scheduled a hearing of the merger application.
Deutsche Bank chairman Rolf Breuer and Bankers Trust chairman Frank Newman applauded the state's decision in a joint statement.
"The New York State Banking Board's approval marks an important step toward completion of our merger," they said. "The approval comes as our integration planning is gaining strong momentum."
The state banking department's approval came after New York City's top financial officer dropped his objections to the deal. Comptroller Alan G. Hevesi said the merger should be allowed to proceed because the German bank has made progress in negotiating Holocaust-related claims.
Separately, Mr. Breuer told reporters in Frankfurt Thursday that Deutsche Bank AG's trading profit continued to develop strongly in April, after a robust rise in the first three months of the year.
"April was a very good continuation" of the first quarter's performance, Mr. Breuer said, when asked whether trading profit increases could be sustained.
A day earlier, Deutsche Bank announced that trading profits had risen 70% in the first quarter amid favorable capital-markets conditions.
However, Mr. Breuer said, it's too early to say whether that level can be maintained throughout the year. "We learned our lessons from the third quarter," he said.
In that period, Deutsche Bank posted a significant trading loss due to fallout from Russia's economic turmoil.
Mr. Breuer countered criticism that the company's costs are rising too sharply. Deutsche Bank's administrative costs rose 21% in the first quarter.
"You have to consider that, particularly in investment banking, costs are performance-related," Mr. Breuer said. "If we have a 70% increase in trading profits and costs are up not as much as that, I'm happy."
Mr. Breuer added that Deutsche Bank is in the midst of an expansion in investment banking and said this effort costs money as well.
"We are investing in intelligence," he said. "For that, we have to spend some money." Mr. Breuer spoke to reporters on the sidelines of an investment conference. - Staff and wire reports
