When he takes over as Deutsche Bank’s co-CEO on Thursday, Anshu Jain will inherit a myriad of court cases involving compensation claims running into millions of dollars and fraud charges against the lender for its role in the US sub-prime mortgage crisis, a report has said.
Germany’s biggest bank is facing numerous charges of defrauding its customers and contributing to the US housing market bubble by marketing complex mortgage and financial products that concealed the risks involved.
Several global financial institutions, including Deutsche Bank, lowered lending standards and promoted the marketing of high-risk products, being well aware that their borrowers could not afford them and they could cause huge losses for investors in mortgage securities, the report said.
How Deutsche Bank will deal with the issue of compensation from clients, who suffered heavy losses when the housing bubble burst in 2007, will be a major test for the bank’s new leadership.
{{/usCountry}}How Deutsche Bank will deal with the issue of compensation from clients, who suffered heavy losses when the housing bubble burst in 2007, will be a major test for the bank’s new leadership.
{{/usCountry}}Jain is expected to inform shareholders about the strategy when Josef Ackermann formally hands over leadership to him and his co-CEO Juergen Fitschen at the annual shareholders' meeting in Frankfurt on Thursday. They will officially take charge on Friday.