New probe casts shadow over Deutsche Bank revamp

Tue Nov 5, 2013 10:08am EST
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By Thomas Atkins

FRANKFURT (Reuters) - Deutsche Bank's struggle to break with the past and achieve a "cultural transformation" has suffered another setback after co-CEO Juergen Fitschen was implicated in a criminal investigation.

The bank set out an ambitious agenda last year to create a leaner, safer lender - exiting risky business lines, abandoning proprietary trading and implementing a "red card" system for staff meant to raise the standard for behavior.

But the list of costly scandals and legal complications keeps getting longer with Fitschen, a principal architect of Deutsche's makeover, named on Monday as a suspect in a investigation into falsifying evidence.

"This shakes the very foundations of trust in the bank," said one Germany-based shareholder.

EU antitrust regulators landed a fresh blow when they included Deutsche on a list of big banks to be fined multi-million euro sums for suspected rigging of benchmark interest rates, a source told Reuters on Tuesday.

Deutsche Bank stands by Fitschen, whose contract was extended until 2017 only last week, saying it was "absolutely convinced" that he would be cleared in the latest investigation.

Munich prosecutors seek to determine whether Fitschen gave misleading evidence in a decade-old civil suit brought by the heirs of late media mogul Leo Kirch, who accuse the bank of undermining the business.

The ball is for now in Fitschen's court, a spokesman for the Munich prosecutor said on Tuesday. "We'll wait and see whether the defense will make a statement after viewing the file," he told Reuters Television.   Continued...

Juergen Fitschen, Co-CEO of Deutsche Bank AG gives a speech during an economic conference organized by the conservative Christian Democratic Union (CDU) party in Berlin June 25, 2013. REUTERS/Fabrizio Bensch