Rumors were milling about a possible Citigroup bid for Deutsche Bank, boosting the American banking giant's shares with its highest increase since last July.

In 2004, Deutsche Bank ended talks with Citigroup, saying a takeover could be too politically controversial. Citigroup and Deutsche Bank spokesmen declined to comment on rumors of a possible new deal.

"I place very little credibility on this speculation," said Jon Peace, an analyst at Foreign investment grant investment bank Fox-Pitt Kelton in London. He says integrating Citigroup's and Deutsche Bank's investment banking units would be very costly, and other purchases could be made to allow Citigroup to expand its consumer banking business in Germany.

Still, Deutsche Bank shares gained as much as 6% on speculation Friday.

Shares of Deutsche Bank AG, Germany's biggest bank, rose the most in nine months on speculation that the bank may be acquired by Citigroup Inc.

"We heard a rumor Citigroup might bid for Deutsche Bank," said Joerg Treptow, a trader at M.M. Warburg & Co. KGaA in Hamburg. "This is boosting the shares today."

(Continue reading this story on Bloomberg)

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