Deutsche Bank AG is among several banks facing probes by financial regulator Bafin over the possible rigging of Euribor interest rates, two people familiar with the matter said.
WestLB, now called Portigon AG, is also being investigated over the Euribor rates, said the people, who declined to be identified because they aren’t authorized to speak about the matter. Sueddeutsche Zeitung reported today Bafin is looking into four German lenders over Euribor, including Portigon and Deutsche Bank. Both lenders are also being reviewed for their participation in Libor rate setting.
Regulators from Canada to Switzerland are investigating whether more than a dozen banks including Deutsche Bank, Barclays Plc and Royal Bank of Scotland Plc colluded to rig benchmark interest rates. UBS AG, Switzerland’s largest bank, was fined $1.5 billion by U.S. and U.K. regulators last month for manipulating interest rates including Euribor and the London interbank offered rate.
The benchmarks are meant to represent the rate at which banks can borrow from other lenders in a specific currency over various periods.
Bafin spokesman Ben Fischer declined to identify any of the banks involved or to say how many are being investigated. Spokesmen for Deutsche Bank and Portigon declined to comment.
The regulator has various forms of reacting to allegations of wrongdoing, said Fischer. The process can be escalated from asking for a dialogue over the issue, ordering to hand in information to opening a special probe, he said.
Raimund Roeseler, Bafin’s top banking regulator, told German lawmakers at a hearing in November banks that participated in either Libor or Euribor rate setting were questioned over the issue and several special probes were started. While he said that Bafin was investigating Deutsche Bank, he didn’t identify any of the other lenders under review.
Banks were also asked to hand in results of their own internal investigations, Roeseler said at the hearing.
Bafin told the banks it would order additional probes “in the foreseeable future” to check whether the risk management was adequately reformed, Roeseler said at the hearing.