German lawmakers quiz Deutsche Bank officials on Libor
By Edward Taylor
BERLIN (Reuters) - German parliamentarians questioned Deutsche Bank's (DBKGn.DE: Quote) compliance chief Stephan Leithner and former board member Hugo Baenziger on Wednesday over how banks including the German lender manipulated global benchmark interest rates.
The London interbank offered rate (Libor), which is used to price billions of dollars worth of financial contracts, was put under the spotlight in June when UK and U.S. authorities fined British bank Barclays (BARC.L: Quote) a record $450 million for manipulating rates during the credit crunch.
Deutsche Bank is cooperating with investigations in the United States and Europe over the setting of rates between 2005 and 2011. It said in July an internal probe found that no members of the management board behaved inappropriately.
But the bank said two of its former traders may have been involved in colluding to manipulate global interest rates.
The German lawmakers are widely expected to press Leithner and Baenziger on details of the individuals involved, including how senior they were, and what sort of payoff they received.
They had hoped to question Deutsche's co-Chief Executive Anshu Jain, a former head of investment banking, but the bank decided to send board member Leithner in his place, sparking criticism from Jain's former boss, Josef Ackermann. The hearing was due to start about 6:30 EDT.
The probe will likely strain the already tense relationship between bankers, who prefer to keep out of the public eye, and politicians, who are eager to demonstrate their grip on the risk-hungry world of global finance.
BUBA AGAINST INTEREFERENCE Continued...