BaFin probes lenders Deutsche Bank over Euribor: paper

Mon Jan 28, 2013 12:47am EST
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FRANKFURT (Reuters) - German regulator BaFin has launched a special probe against four lenders including Deutsche Bank (DBKGn.DE: Quote) as part of an investigation into possible manipulation of the Europe Interbank Offered Rate (Euribor), the Sueddeutsche Zeitung newspaper reported on Monday.

A special probe is the most severe kind of investigation the regulator can launch against a bank.

The German regulator is also investigating Portigon AG WDLGge.F, Sueddeutsche Zeitung said, without citing sources. Portigon is what remains following the breakup of the bank that used to be known as WestLB.

Officials at Deutsche Bank and BaFin were not available for comment. Portigon officials were also not available for comment.

The special probes were launched after BaFin had asked for information from all German banks involved in setting Euribor rates, Sueddeutsche said.

Euribor and its larger counterpart, Libor, or the London Interbank Offered Rate, are Europe's key gauges of how much banks pay to borrow from their peers and are used to set the prices of swathes of financial products, from Spanish home mortgages to more complex derivatives.

Deutsche Bank is already being subjected to a BaFin special probe in connection with Libor.

Deutsche Bank has said it is cooperating with investigations in the United States and Europe in connection with setting rates between 2005 and 2011.

In July, Reuters reported that several banks under investigation for suspected rigging of Euribor intensified cooperation with EU antitrust regulators in the hope of lower fines.   Continued...

A visitor walks past the bank's logo prior to Deutsche Bank's annual news conference in Frankfurt February 2, 2012. REUTERS/Kai Pfaffenbach