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German government tells lawmakers it would not take a stake in Deutsche Bank-WSJ

FRANKFURT Oct 14 Aides to German Chancellor Angela Merkel told lawmakers last week the state would not take a stake in Deutsche Bank if it were to issue new stock, the Wall Street Journal said on Friday, citing a person who attended the briefing.

Deutsche has been engulfed in crisis since news emerged last month of a U.S. Department of Justice demand for $14 billion to settle allegations that it mis-sold mortgage securities before the global financial crisis. It is fighting the claim but might have to turn to investors for more money depending on the size of any eventual settlement.

In a closed-door briefing with a small group of lawmakers last week aides to the Chancellor and senior Finance Ministry officials said it was "inconceivable for the state to take a stake in Deutsche Bank," the newspaper said.

"We have a different bank resolution system than in 2009 and this must apply to us in Germany too," the government officials said according to the person.

Deutsche Bank declined to comment. No one at the finance ministry was immediately available for comment. (Reporting by Harro ten Wolde; Additional reporting by Holger Hansen in Berlin; Editing by Greg Mahlich)

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