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A Deutsche Bank AG logo sits on a sign for an automated teller machine in Berlin. (Bloomberg) |
FRANKFURT (AFP) ― Deutsche Bank, Germany’s biggest lender, said on Friday it will pay 1.4 billion euros ($1.9 billion) to end litigation related to home mortgage-backed securities in the United States.
“Deutsche Bank announced today that it has reached an agreement to resolve its residential mortgage-backed securities litigation with the Federal Housing Finance Agency as conservator for Fannie Mae and Freddie Mac,” the bank said in a statement.
It described the litigation as its single largest mortgage-related litigation case.
“As part of the agreement, Deutsche Bank will pay 1.4 billion euros,” the statement said.
“It resolves allegations that between 2005 and 2007 the bank did not provide adequate disclosure about certain residential mortgage-backed securities sold to Fannie Mae and Freddie Mac.”
Deutsche Bank was one of 17 institutions against which FHFA had brought lawsuits.
“Today’s agreement marks another step in our efforts to resolve Deutsche Bank’s legacy issues, and we intend to make further progress in this regard throughout 2014,” said co-chief executives Juergen Fitschen and Anshu Jain.
“We have exited the mortgage businesses that gave rise to these claims and have further improved our controls.”
Deutsche Bank is investing 1 billion euros “to elevate its systems and controls to best in class,” Jain and Fitschen said.
The settlement was already substantially reflected in Deutsche Bank’s existing litigation reserves “and no material additional reserves will be taken for this settlement,” the statement added.
