Deutsche Bank AG said co-Chief Executive Officer Anshu Jain didn’t mislead Germany’s central bank during an investigation of Libor rigging.
“Mr. Jain disputes as baseless the allegation that he misled the Bundesbank in his 2012 interview,” Michael Golden, a Deutsche Bank spokesman, said Friday in an e-mailed statement. “He understood Bundesbank’s question about when he first learned of rumors of possible IBOR rigging to mean rigging at Deutsche Bank itself which he learned of in 2011, not rigging in the marketplace which was publicly reported on in 2008,” Golden said, referring the interbank offered rate.
German financial regulator Bafin, which last month completed its review of Libor rigging, found Deutsche Bank senior managers acted “negligently” and that Jain may have misled the central bank, the Financial Times reported Friday.
Deutsche Bank may be vulnerable to additional action by authorities and the Bafin report concludes that special “banking supervisory measures” should be considered for the Frankfurt-based firm, according to the newspaper. The FT also reported that Pacific Investment Management Co., one of the lender’s biggest clients, incurred losses when one of the bank’s traders tried to manipulate ISDAfix, a derivatives benchmark being scrutinized by U.S. watchdogs.
Deutsche Bank announced earlier this month that Jain, 52, is stepping down and will be replaced in July by supervisory board member John Cryan. Co-CEO Juergen Fitschen, 66, departs next year, leaving Cryan, 54, as the sole chief. Christian Streckert, a company spokesman, said at the time that it’s “categorically false” to imply that Jain’s decision to step down early was forced by regulators.
Earlier this month, German Spiegel magazine said the Bafin report, while critical of Jain and other top managers, concluded that no board member was directly involved in manipulating interest rates.
“We have paid a heavy price and expressed deep regret for the wrongdoing that occurred, and continue to draw lessons from this matter,” Golden said in a separate statement.
After receiving Deutsche Bank’s response, Bafin will decide on the consequences, the regulator said last month.
Deutsche Bank was fined a record $2.5 billion in April for manipulating interest-rate benchmarks. The bank still faces potential fines related to foreign exchange, mortgage- and asset-backed securities and precious metals dealings, and is under investigation for alleged U.S. sanctions violations, filings show.