The decade-old mortgage-lending scandal that won't go away...
The US Justice Department has called on Deutsche Bank to pay $14 billion to settle allegations of mis-selling mortgage securities in the country between 2005 and 2007.
According to the Wall Street Journal, the settlement claim was as much as three times higher than expected, causing Deutsche's US-quoted share prices to fall by more than 7% in after hours trading on Thursday night. Its shares have already fallen by 50% over the last year.
Deutsche, which is Europe's biggest bank, hit back immediately, stating that it has no intention of paying these initial civil claims and that negotiations are just beginning.
The figure represents the US government's opening bid and the ultimate settlement could be much lower.
Analysts believe any final settlement of over $4bn, less than one third of this initial claim, could threaten Deutsche’s financial reserves, which the International Monetary Fund (IMF) amongst other agencies has identified as a threat to the stability of financial markets.
The IMF branded Deutsche "the world's riskiest bank" in June. It announced a 98% plunge in profit for the second quarter of the year.