In a leaked report by the German weekly newspaper Der Spiegel, Deutsche Bank executives are put on the spot by the German finance regulator (BaFin) over suggestions that little has been done to restore the bank’s reputation.
Following the Libor scandal, BaFin and other regulators started investigating Deutsche and more than a dozen other institutions after allegations that they manipulated benchmark interest rates such as Libor and Euribor. The BaFin interim report points out that the Deutsche Bank did not make senior management changes as expected. The lack of “intensive engagement” by the Board of the German’s biggest bank with regards to disciplinary consequences to staff shows that the bank had not done enough to clean up its act despite several scandals.
The promotion of Alan Cloen, the bank’s head of global finance and foreign exchange when the scandal broke, to the general executive committee in 2012 and the keeping of two other senior staff, Richard Walker, general counsel at the bank, and Andrew Procter, head of compliance, suggest that Anshu Jain and Jürgen Fitschen, co-heads of Deutsche Bank, failed to deliver the so promised “profound” change in senior management and still reward bankers who held positions of responsibility at the time of the Libor scandal.
Deutsche Bank has so far dismissed at least seven bankers in its continuing internal probe into Libor. Four of those, however, were reinstated at the bank in Frankfurt late last year after a court ruled they had been unfairly dismissed.
In its response, Deutsche Bank’s spokesman stressed that, whilst the bank is closely cooperating with the watchdog investigations, an internal report into Libor manipulation cleared the members of its management board and, since “no current or former member of the management board had any inappropriate involvement”, it is safe to say that “the bank has taken swift action with respect to individuals that have ignored the bank’s standards”.
Please read the Financial Times article here.