The U.S. Department of Justice asked Deutsche Bank, Germany’s biggest lender, to pay $14 billion to settle an investigation into the sale of residential mortgage-backed securities.
The company said it has “no intent” to pay the huge sum tied to the bank’s sale of mortgages between 2005 and 2007 and plans to negotiate the sum down in lengthy talks.
Deutsche Bank hasn’t revealed the sum it set aside in advance of a settlement. As of June 30, the bank held $6.2 billion in litigation reserve and will likely set more aside at the end of the year.
“Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited. The negotiations are only just beginning,” the bank said. “The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts.”
Big U.S. banks, including Bank of America and Goldman Sachs, have paid billions for their mortgage activities before and during the financial collapse in 2008. The banks have been accused of fueling a rise in home prices that led to the financial crisis. Goldman Sachs and Bank of America paid $5.1 billion and $16.7 billion respectively to settle similar claims.
[Source:-UPI]
