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Deutsche Bank's headquarters in Frankfurt were raided this week, according to various media reports. The public prosecutor suspects the bank of money laundering, which allegedly took place from 2013 to this year. In response to this news, Deutsche Bank's stock slumped to a new low of just over €8.
During the raid, which took place on Thursday and Friday, the floor where the bank's board works was also searched. The public prosecutor in Germany says it has indications that suspicious transactions have taken place in bank accounts of Deutsche Bank customers in the British Virgin Islands. These transactions are said to be related to criminal activities.
The Financial Times writes that in 2016 there were €311 million worth of suspicious transactions. The total amount is likely to be much larger, as the suspicious activities have been taking place since 2013.
The Deutsche Bank subsidiary that is in the spotlight is called Regula Limited and is registered in the British Maaden Islands. According to the Financial Times, this subsidiary has been owned by Deutsche Bank since 2010 but was sold in March 2018. The bank has indicated that it will cooperate fully with the investigation.
Deutsche Bank's market value has almost halved in a year's time, as the share was worth €16 a year ago. Germany's largest bank has been under heavy pressure in recent years due to various scandals and abuses. The stock fell to its lowest level since 1985 on Friday.
There's a pleasing symmetry to Deutsche Bank shares, slightly messed up by them being lower now than in 1973. If you'd reinvested dividends, you're back to where you stood in 1985. pic.twitter.com/dSr7CPvV6L
— James Mackintosh (@jmackin2) November 30, 2018
Ouch! Yield of Deutsche Bank 6% Coco bond keeps rising. Now trades at 11.3% pic.twitter.com/RMLyO7zWh5
— Holger Zschaepitz (@Schuldensuehner) November 30, 2018
Deutsche Bank share halved in value (Source: Google Finance)
