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Deutsche Bank shares spike on report of interest from JPM and ICBC

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Deutsche Bank shares spike on report of interest from JPM and ICBC

Deutsche Bank shares spike on report of interest from JPM and ICBC
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FRANKFURT (Reuters) - Shares in Germany's troubled Deutsche Bank <DBKGn.DE> jumped by up to 6 percent on Friday following a magazine report that JPMorgan <JPM.N> and Industrial and Commercial Bank of China (ICBC) <601398.SS> may be interested in taking a stake.

Business weekly WirtschaftsWoche, citing regional government sources, also said Chancellor Angela Merkel had met Axel Weber, the former Bundesbank head who is now chairman of Swiss bank UBS <UBSG.S>, to sound out his views on Deutsche Bank.

The German government, UBS and JPMorgan had no immediate comment. Deutsche Bank declined to comment. ICBC could not immediately be reached for comment.

Shares in Germany's flagship bank recently touched record lows on scepticism over the appointment of Christian Sewing as CEO and his strategy to refocus on its European core while slashing global investment banking.

Investors have said they doubt whether Sewing, 48, can return Deutsche to profitability after the bank racked up three years of losses under his predecessor, John Cryan.

He has been hobbled by downgrades to Deutsche's credit ratings, while the bank's U.S. subsidiary has failed a Federal Reserve test of its ability to withstand a financial crisis.

Despite Deutsche's woes, its franchise is attracting interest as London's standing as a financial centre is threatened by Britain's looming exit from the European Union, WirtschaftsWoche cited investment bankers as saying.

Bulge-bracket banks are looking to strengthen their presence in Frankfurt, as the German financial capital and seat of the European Central Bank gains importance after Brexit.

Deutsche's shares have fallen by nearly two fifths this year, reducing its market capitalisation to below 20 billion euros ($23.4 billion). That compares to JPMorgan's $353 billion and ICBC's $274 billion.

(Writing by Douglas Busvine; Additional reporting by Hans Seidenstuecker, Oliver Hirt, Gernot Heller and Engen Tham; Editing by Maria Sheahan and Edmund Blair)

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