Deutsche Bank Reaches $7.2B Settlement For US Mortgage Probe
Deutsche Bank reached a $7.2B settlement that resolves investigations into the firm’s mortgage-backed securities business that helped fuel the 2008 financial crisis.
Experts say the settlement could help the bank in the short term by removing a major source of uncertainty that’s hung over Deutsche Bank for years, but in the long run it’s likely to drag down earnings, Bloomberg reports. The firm will pay a $3.1B civil penalty while providing $4.1B in consumer relief.
That’s a pretty generous deal considering the US Justice Department initially called for a $14B fine, and Deutsche Bank’s stock responded by rising 4.5% in Frankfurt trading. [Bloomberg]