(Bloomberg) -- Deutsche Pfandbriefbank AG, a German lender focused on commercial real estate, put aside more money for souring loans to prepare for what it said was the biggest property upheaval since the financial crisis 15 years ago.

The firm known as PBB said provisions for last year will be as much as €215 million ($232 million), according to a statement Wednesday. Pretax profit for the year is expected to reach €90 million, at the bottom of its already downgraded range, according to preliminary figures.

PBB, whose predecessor was bailed out by Germany in the 2008 crisis, joins a string of lenders coming under pressure over their exposure to commercial real estate, including in the US. Bonds issued by real estate-focused German lenders slumped earlier Wednesday after Morgan Stanley analysts recommended clients sell senior bonds issued by PBB because of its exposure to the US market, according to people with knowledge of the matter who spoke on condition of anonymity.

Shares of PBB pared declines, falling 0.8% as of 1:03 p.m. in Munich. They’ve lost about 10% this week.

Investors have been nervous since New York Community Bancorp reported a surprise loss last week and slashed its dividend. Smaller and regional banks are the biggest providers of commercial real estate finance in the US, but some European lenders also have exposure.

PBB said as of the end of last year, its CET1 ratio — a key measure of capital strength — remained above 14% and its liquidity coverage ratio was at 212%, more than double the regulatory requirement. The lender is scheduled to report detailed results on March 7.

©2024 Bloomberg L.P.