Deutsche Bank to fight $14 billion demand from U.S. authorities
Source: Reuters
Deutsche Bank (DBKGn.DE) said it would fight a $14 billion demand from the U.S. Department of Justice to settle claims it missold mortgage-backed securities, a shock bill that raises questions about the future of Germany's largest lender.
The claim against Deutsche, which is likely to trigger several months of talks, far exceeds the bank's expectations that the DoJ would be looking for a figure of only up to 3 billion euros ($3.4 billion).
The demand adds to the problems facing Deutsche Bank's Chief Executive John Cryan, a Briton who has been in the job for a year.
The bank only scraped through European stress tests in July and has warned it may need deeper cost cuts to turn itself around after revenue fell sharply in the second quarter due to challenging markets and low interest rates.
Read more: http://www.reuters.com/article/us-deutsche-bank-mortgages-idUSKCN11L2VQ
MowCowWhoHow III
(2,103 posts)The US Department of Justice is asking Deutsche Bank to pay $14bn (£10.6bn) to settle an investigation into mortgage-backed securities, the bank has said.
Deutsche Bank said it "has no intention to settle these potential civil claims anywhere near the figure cited".
The claim against Deutsche, which is likely to be the subject of negotiations for several months, was much bigger than expected.
The bank's shares fell nearly 7% in early trading.
http://www.bbc.co.uk/news/business-37380895
Deutsche Bank shares hit a new record low today. Its value has halved since the beginning of the year.
So is it now the most dangerous bank in the world? According to the International Monetary Fund - yes.
Last week, the IMF said that, of the banks big enough to bring the financial system crashing down, Deutsche Bank was the riskiest. Not only that, Deutsche Bank's US unit was one of only two of 33 big banks to fail tests of financial strength set by the US central bank earlier this year.
It's not hard to get scared when you look at a few numbers. Bear with me.
http://www.bbc.co.uk/news/business-36723034
LittleGirl
(8,287 posts)FrodosPet
(5,169 posts)LittleGirl
(8,287 posts)Kathy M
(1,242 posts)Article written June 3 2016
"Earlier this week, Mother Jones reported that Donald Trump's loans from the German-based Deutsche Banktotaling at least $100 million and possibly much morewould pose a significant conflict of interest, should Trump, the GOP's presumptive nominee, become president. After all, the bank was recently caught manipulating markets around the world (and had to pay $2.5 billion in fines), and it has tried to evade US laws aimed at curtailing risky financial shenanigans and has attempted to influence the US government via lobbying.
Richard Painter, an attorney who teaches at the University of Minnesota and who was the chief ethics lawyer for President George W. Bush from 2005 to 2007, noted that Trump's relationship with the overseas financial giant was disturbing: "Having a president who owes a lot of money to banks, particularly when it's on negotiable termsit puts them at the mercy of the banks and the banks are at the mercy of regulators." He added, "That is a potentially very troublesome business model for someone in public office."
In response to the article, Sen. Elizabeth Warren (D-Mass.) says Trump's dealings with Deutsche Bankand his connections with other major financial institutionscould indeed pose trouble, were he to win the White House. In a statement to Mother Jones, the senator slammed Trump's relationship with the bank:
The job of the President is to enforce the law fairly. If a serial lawbreaker like Deutsche Bank is caught manipulating markets again, how would Trump hold it accountable knowing that the bank had the power to pull the plug on his own businesses? That's a question that should worry every American. These financial entanglementsalong with many of his other ongoing business concerns and arrangementspresent huge conflicts of interest. "
Rest of article ... http://www.motherjones.com/politics/2016/06/elizabeth-warren-slams-donald-trump-huge-conflicts-interest
Nitram
(22,813 posts)I love seeing their bank exposed for fraud and fined into bankruptcy.
BlueEye
(449 posts)for unpaid taxes. Which the U.S. government opposes. The EU likewise may object to such a large (possibly destabilizing) fine of a major German bank.
At the same time Deutsche Bank really was engaged in basically fraudulent activity, and they deserve a big fine, at least $5B. Somehow I predict this gets settled for $2.