Confidence in the German bank was shaken last week, with its share prices gyrating over fears Deutsche may not withstand the impact of a $14 billion settlement to end a mortgage-backed securities mis-selling case.
On Friday, Deutsche Bank's U.S.-listed shares jumped 15 percent after the AFP wire cited a source as saying the bank may be nearing a $5.4 billion settlement with the DOJ, a big discount on the original penalty suggested by the DOJ. CNBC has not independently confirmed the report.
On Monday, the Wall Street Journal reported that talks between the bank and officials were ongoing, with no deal yet presented to senior decision makers on either side for approval.
But Richard Jerram, chief economist at the Bank of Singapore, told CNBC's "The Rundown" that even if a settlement averted further panic over Deutsche's financial stability, there was an underlying issue that would continue to undermine confidence.
"They can reach a deal where it's $4 billion or $5 billion, which, based on precedence, I guess is the ball park," Jerram said, referring to the size of settlements reached in similar cases by other banks.
"But, of course, you still have this problem of big overcapacity in the German banking system, and the lack of profitability,"