FRANKFURT (Reuters) - One of Germany’s biggest financial groups, DZ Bank, joined the country’s growing list of casualties from the subprime mortgage crisis on Thursday when it said the turmoil had forced it to make heavy writedowns.
DZ Bank is the central bank for Germany’s roughly 1,100 cooperative banks and also links them to international capital markets.
Its role is similar to that of a landesbank such as WestLB, which acts as a window for community savings banks to the global world of finance. Landesbanks have also been hard hit by the financial market ructions.
Now DZ Bank has unveiled 1.36 billion euros ($2 billion) of writedowns on the value of subprime-linked investments.
And it warned that worse could follow because of rating agency downgrades on investments and a deterioration in the market for this kind of debt at the start of this year.
DZ Bank still has a portfolio of risky debt investments of 26 billion euros, almost 3 billion euros of which is in subprime mortgages.
“It is very difficult to make a …
