Deutsche Bank’s exposure to “casino banking” in Las Vegas has reached $4.9bn, rivalling its exposure to countries affected by the eurozone debt crisis.

The bank has become one of the biggest investors and creditors in the US gambling capital. It has a $3.9bn credit facility with the 3,000-room Cosmopolitan casino – a wholly owned subsidiary which Deutsche built when the developer defaulted on loans from the bank. It also holds $1bn of debt, and 25 per cent of the equity, in Station Casinos, which owns several casinos in the Las Vegas area.

This compares with Deutsche’s $5.1bn exposure in the countries affected by the sovereign debt crisis – Greece, Italy, Ireland, Spain and Portugal.

Owning casinos was never part of Deutsche’s strategy in Las Vegas and the bank told the Financial Times the Cosmopolitan – which cost about $4bn to build – was “neither a strategic nor a long-term investment”.

Las Vegas, described as “ground zero of the world economic crisis” by the Brookings Institution, has been badly hit by the recession and housing collapse.

via Deutsche Bank’s casinos exposure hits $4.9bn – FT.com.