SummarySummary Companies European banks, bonds, CDS sell offDeutsche Bank CDS rise to highest since late 2018Confidence hurt, outlook dimsLONDON, March 24 (Reuters) - Confidence in European banks deteriorated further on Friday, with the cost of insuring against a debt default rising sharply as the profit outlook for the sector dimmed. Deutsche Bank's (DBKGn.DE) five-year credit default swaps (CDS) jumped 19 basis points (bps) from Thursday's close to 222 bps, rising to their highest since late 2018, data from S&P Global Market Intelligence showed. The prospect that interest rates may be close to peaking, as financial markets are signalling, would also curb banks' profit margins on lending. BOND WATCHEuropean banks' Additional Tier 1 (AT1) debt came under fresh selling pressure, with Deutsche AT1 prices down 6 cents, according to Tradeweb data. The selloff in AT1s highlighted concerns about rising funding costs for European banks and helped explain why the sector was facing renewed pressure on Friday, analysts said.

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