Deutsche Bank Said to Have Submitted Paschi Contracts to Court
Deutsche Bank AG voluntarily submitted documents to Siena prosecutors that relate to its derivative transaction with Banca Monte dei Paschi di Siena SpA, a deal the Italian lender used to mask losses, according to two people with direct knowledge of the case.
Deutsche Bank’s lawyers met with Siena prosecutors on March 22 to discuss the transaction, dubbed Project Santorini, the people said, asking not to be identified because the talks were private. The German bank, which isn’t under investigation, gave prosecutors official documents on the trade, including contracts, one of the people said.
A Deutsche Bank official declined to comment.
Siena prosecutors are probing former managers of Monte Paschi (BMPS) for alleged obstruction of regulatory activity, market manipulation and false bookkeeping. In Project Santorini, a transaction never fully disclosed to investors, the bank made a money-losing bet on the country’s government bonds while hiding losses on an existing derivative, Bloomberg News first reported on Jan. 17.
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