More police raids at Deutsche Bank spell trouble for its new CEO

Christian Sewing has been chief executive of Deutsche Bank for less than eight months, but he's already faci...

Posted: Nov 30, 2018 7:52 PM
Updated: Nov 30, 2018 7:52 PM

Christian Sewing has been chief executive of Deutsche Bank for less than eight months, but he's already facing a major test of his ability to turn a page on the bank's troubled past.

German authorities searched the bank's offices in Frankfurt for a second consecutive day on Friday as part of an investigation into potential money laundering.

Companies

Deutsche Bank AG

Investigations

Business executives

Business figures

Christian Sewing

Labor and employment

Workers and professionals

Crime, law enforcement and corrections

Criminal law

Law and legal system

Banking institutions

Banking, finance and investments

Business, economy and trade

Consumer banking

The scale of the legal threat posed by the investigation remains unclear. But a lengthy — and costly — probe could make it harder for Sewing to overhaul the struggling lender and further delay the return to healthy profits.

Prosecutors in Frankfurt are looking into whether Deutsche Bank (DB) helped customers set up offshore companies in tax havens, while failing to report suspicious transactions.

Both the bank and prosecutors said the probe is related to the Panama Papers, a 2016 leak of confidential documents that exposed international money laundering networks and shell companies.

The investigation covers events that happened as recently as this year, according to prosecutors. On Friday, a source with knowledge of the situation said that authorities had searched Sewing's office.

Shares in Deutsche Bank have plummeted nearly 6% since the raids commenced, at one point dropping below €8 ($9.10) to reach a new all-time low.

Deutsche Bank said in a statement that it would cooperate with investigators. "As far as we are concerned, we have already provided the authorities with all the relevant information regarding [the] Panama Papers," it said.

Germany's biggest bank employs roughly 95,000 workers and has assets worth €1.4 trillion ($1.6 trillion). It's one of 29 lenders designated by the Bank for International Settlements as playing a significant role in the global financial system.

Yet it has struggled to turn a profit in recent years amid questions about its business strategy, and the heavy financial burden of past misconduct.

Deutsche Bank has spent over $19 billion on legal costs since 2008, including $7.2 billion on a settlement with the US government in January 2017 over claims that it packaged and sold toxic mortgages.

Sewing, a retail banking veteran who took over as CEO in April, has used his first months in the job to accelerate an overhaul of the bank, which has closed hundreds of branches, cut thousands of jobs and slashed costs.

He struck a positive tone when the bank published its third quarter financial report in October, writing in a letter to employees that "what we've achieved so far this year makes me optimistic."

"The prospects are good," he added. "The past few months have proven how much corporates, institutional investors and private clients are willing to work with us and how good and stable our client relationships are."

New potential legal issues, however, threaten to ensnare Sewing in the same pattern of negative headlines and higher legal costs that hobbled his predecessors.

Sewing has claimed meaningful progress on cost reductions. But the bank's stock price has continued to decline, with losses reaching nearly 50% so far this year.

The CEO said in October that Deutsche Bank was on track to produce its first annual profit since 2014. That's one thing that could help restore the faith of investors.

Minnesota Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 40767

Reported Deaths: 1533
CountyConfirmedDeaths
Hennepin13054790
Ramsey5127233
Dakota257094
Stearns248119
Anoka2360111
Nobles16766
Olmsted123518
Washington122840
Mower9742
Rice8738
Scott8234
Clay60138
Kandiyohi5871
Blue Earth5442
Wright5165
Carver4421
Todd4022
Sherburne3445
Lyon3322
Freeborn3090
Watonwan2450
Steele2431
Benton2353
St. Louis21816
Nicollet19112
Martin1725
Cottonwood1380
Goodhue1388
Winona13615
Le Sueur1191
Pine1110
Crow Wing11012
Chisago1051
Otter Tail1041
McLeod990
Dodge970
Carlton890
Polk863
Unassigned8638
Isanti800
Chippewa791
Waseca750
Douglas690
Itasca6912
Murray680
Pipestone674
Meeker621
Morrison621
Faribault610
Becker570
Jackson570
Sibley572
Pennington530
Beltrami430
Brown432
Renville372
Mille Lacs362
Wabasha350
Fillmore310
Rock310
Yellow Medicine310
Houston290
Swift291
Grant240
Norman210
Redwood210
Roseau210
Wilkin213
Cass192
Big Stone170
Koochiching171
Kanabec161
Wadena160
Aitkin150
Lincoln130
Marshall120
Pope120
Clearwater100
Mahnomen101
Stevens100
Hubbard80
Lake60
Traverse60
Lac qui Parle40
Red Lake40
Kittson20
Cook10
Lake of the Woods00

Iowa Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 34080

Reported Deaths: 742
CountyConfirmedDeaths
Polk7196182
Woodbury331744
Black Hawk245759
Buena Vista173311
Johnson14058
Linn136683
Dallas136531
Marshall108019
Scott100210
Dubuque91822
Story8515
Pottawattamie80612
Wapello71431
Muscatine68544
Crawford6793
Sioux4970
Tama48229
Wright3971
Louisa36513
Plymouth3455
Webster3454
Jasper33717
Warren3111
Dickinson2953
Cerro Gordo2661
Washington2499
Hamilton1981
Boone1641
Clay1481
Clarke1433
Allamakee1384
Clinton1301
Shelby1200
Mahaska11917
Carroll1101
Poweshiek1108
Bremer1067
Pocahontas1061
Franklin1040
Des Moines1002
Emmet950
Cedar941
Henry933
Hardin890
Cherokee821
Taylor810
Monona780
Marion770
Floyd762
Benton741
Guthrie734
Jones690
Osceola660
Sac650
Butler642
Buchanan621
Jefferson620
Calhoun612
Iowa611
Humboldt591
Hancock581
Harrison580
Delaware561
Fayette560
Jackson560
Lee542
Madison532
Monroe517
Lyon500
Clayton483
Palo Alto480
Grundy470
Mills470
Winneshiek450
Mitchell440
Davis421
Kossuth410
Union380
Howard370
Lucas344
Winnebago330
Greene300
Chickasaw290
Cass270
Unassigned270
Ida230
Keokuk231
Worth220
Appanoose213
Van Buren210
Page200
Adair170
Audubon161
Ringgold151
Decatur130
Montgomery112
Wayne110
Fremont100
Adams80
Rochester
Overcast
64° wxIcon
Hi: 78° Lo: 60°
Feels Like: 64°
Mason City
Few Clouds
68° wxIcon
Hi: 82° Lo: 62°
Feels Like: 68°
Albert Lea
Scattered Clouds
72° wxIcon
Hi: 77° Lo: 61°
Feels Like: 72°
Austin
Overcast
68° wxIcon
Hi: 79° Lo: 61°
Feels Like: 68°
Charles City
Broken Clouds
68° wxIcon
Hi: 81° Lo: 62°
Feels Like: 68°
Cooler air finally filtering in, rain chance returns Saturday
KIMT Radar
KIMT Eye in the sky

Latest Video

Image

Connecting with a loved one with dementia during the pandemic

Image

Bruins set to host all-star game

Image

COVID-19 Cases Expected to Spike in North Iowa

Image

Training hard for a season that might not happen

Image

Sean's 6pm Weather 7/10

Image

Sweet Corn season kickoff

Image

Getting caught in the act

Image

Forum tomorrow: educating young voters

Image

Donation to Channel One Food Bank

Image

Concern over spread of COVID-19 downtown

Community Events