Deutsche Bank traders win unfair dismissal case

Wed Sep 11, 2013 2:41pm EDT
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By Edward Taylor

FRANKFURT (Reuters) - Four traders have won a case for wrongful dismissal against Deutsche Bank AG (DBKGn.DE: Quote), which had accused them of violating company policy by inappropriately communicating with other traders at the bank over the setting of interbank lending rates.

The four were responsible for setting Euribor and Libor interbank rates and their dismissal in February came amid a broader inquest into interbank rates. Three banks have been fined for manipulating Libor, a larger counterpart to Euribor, and investigations are continuing into the matter.

Rates such as Euribor and Libor are hugely important in financial markets, not just as key gauges of how much banks pay to borrow from their peers but also to set prices for financial products from mortgages to complex derivatives.

Announcing her ruling relating to the ex-Deutsche Bank traders on Wednesday, presiding judge Annika Gey told a Frankfurt labor court: "The termination was out of proportion".

She ordered Deutsche to reinstate the traders and pay them their salaries for the period since they were fired in February. The traders' lawyer said they did not wish to be named.

Deutsche Bank said in a statement: "We regret the court's decision and believe our action in this matter was justifiable .. . We wait for the written judgement and will then decide whether we will appeal the decision."

The bank had fired five Frankfurt-based traders suspected of inappropriate conduct following an internal investigation into possible manipulation of the Europe Interbank Offered Rate or Euribor. One had already reached a settlement with Deutsche Bank.

Deutsche had told the Frankfurt Labor court it had fired the five after discovering some staff appeared to have shown a willingness to consider the bank's own trading positions when they submitted their estimates for the Euribor and Libor rates.   Continued...

A logo of Deutsche Bank AG is seen in Tokyo September 9, 2013. REUTERS/Toru Hanai