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Deutsche Bank pays $145 mln to settle US suit

German banking giant Deutsche Bank has agreed to pay US regulators $145 million (€106 million) to settle charges that they misled credit unions about the risks of mortgage-backed securities that later collapsed.

Deutsche Bank pays $145 mln to settle US suit
Photo: DPA

The money is being paid to the National Credit Union Administration and is supposed to help cover billions of dollars the federal organisation charged other credit unions for expenses related to liquidating failed credit unions in 2009 and 2010.

Citigroup also agreed to pay $20.5 million (€15 million) in the settlement deal. Despite the payments, both banks denied any wrongdoing.

The announcement comes at a sensitive time for Deutsche Bank, as its chief executive Josef Ackermann said on Monday he would not take a seat on the bank’s supervisory board next year as originally envisaged following his planned departure from the management board next year.

Ackermann cited the “extremely challenging conditions on the international financial markets and in the political-regulatory environment,” which demand his full attention as the current management board chair for the decision. He is slated to step down as CEO next May.

But also possibly playing into the decision may be a brewing investigation by Munich prosecutors over Ackermann’s testimony in a civil suit connected to the demise of the media group of the late Leo Kirch.

The offices of both Ackermann and ex-supervisory board chief Clemens Börsig, as well as the home of former Deutsche Bank CEO Rolf Breuer were searched as part of the investigation.

Deutsche Bank itself rejected the accusations and slammed the action by prosecutors as “disproportionate”.

“The bank is confident that, as in all previous proceedings in the Kirch case, the charges will be shown to be unfounded,” it said.

Kirch, who died earlier this year, sued Deutsche Bank a number of years ago, saying that the bank’s then CEO Breuer had questioned the creditworthiness of his media empire, ultimately leading to its collapse.

The Local/AFP/DPA

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DEUTSCHE BANK

Deutsche Bank set ‘to cut ties with Trump’

Deutsche Bank will cease its longstanding relationship with outgoing US president Donald Trump, The New York Times reported on Tuesday.

Deutsche Bank set 'to cut ties with Trump'
Deutsche Bank's headquarters in Frankfurt. Photo: DPA

Deutsche Bank was Trump's primary lender for two decades, and he owes the institution more than $300 million, according to the newspaper, which cited an unnamed source as saying the German lender “has decided not to do business with Mr. Trump or his company in the future.”

Deutsche Bank declined to comment to AFP.

The move comes on the heels of last week's violent attack on the US Capitol by Trump supporters at the president's incitement, and follows steps taken by other companies to cut ties with Trump and his businesses.

READ ALSO: Trump under investigation for Deutsche Bank ties

Christiana Riley, head of Deutsche Bank's US division, called the violent
siege on the Capital “a dark day for America and our democracy” in a post on LinkedIn last week.

“We are proud of our Constitution and stand by those who seek to uphold it to ensure that the will of the people is upheld and a peaceful transition of power takes place,” Riley said.

“It is my hope that these shocking events will result in a reinvigoration
of the principles our nation was built upon.”

Trump's relationship with Deutsche Bank has sparked numerous probes in the United States, including in New York, where the Manhattan District Attorney is investigating whether Trump committed financial crimes as he sought loans.

READ ALSO: 'Worlds between us': What Trump's German family's town thinks of him today

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