Frankfurt - Deutsche Bank AG chief Josef Ackermann said Thursday Germany's biggest bank was prepared to launch a fresh acquisitions drive as part of consolidation in the nation's banking market, but warned financial markets remained challenging.

"We will not stand on the sidelines," Ackermann told the bank's stockholders attending the group's annual general meeting in Frankfurt, as signs grow of fresh moves for a shakeout in Germany's fragmented banking sector.

In particular, the Deutsche Postbank AG, the banking offshoot of the German postal and logistics group Deutsche Post AG as well as the US-owned Citigroup Inc's German consumer offshoot have emerged as possible targets for Deutsche Bank.

The Deutsche Bank's stockholders' meeting come in the wake of continuing sense of uncertainty on global financial markets triggered by the global credit crunch and the US mortgage market crisis.

"We are at the beginning of the end of the crisis," Ackermann said, but he went on to say: "Even if, over the past few weeks, the first signs of a stabilization of the financial markets have been observed, the challenges will continue to dominate, at least initially."

However, he added, 2008 will not be an easy year.

Deutsche Bank slipped into the red for the first time in five years during the first quarter of the year on the back of the turbulence that has hit financial markets over about the last ten months.

But Ackermann expressed optimism that the bank would be able to "iron out the small dent at the beginning of the year." (dpa)