(MENAFN- AFP) Deutsche Bank is near an agreement with US officials to pay $5.4 billion to settle charges over its sale of toxic mortgage bonds ahead of the financial crisis, a person familiar with the matter said Friday.
The figure was far less than the $14 billion asked by the US Justice Department, and sent the beaten-down shares of the German financial giant soaring.
Near 1530 GMT, Deutsche Bank shares were up 16 percent to 11.70 euros in Frankfurt.
US shares of Deutsche Bank rose 14.5 percent to $13.15.
An agreement could be announced in the next couple of days, the source told AFP. The final amount of settlement could also be slightly different.
US officials had earlier pressed Deutsche Bank to pay $14 billion to settle the case, which concerns allegations the German bank knowingly sold toxic mortgage-backed securities between 2006 and 2008 that helped lead to the financial crisis.
But Deutsche Bank rejected the figure, which analysts called big enough to stress the German bank's capital position.
The tough US stance raised questions of whether Deutsche Bank would seek a bailout from the German government, an idea strongly rejected by German officials.
Deutsche Bank and the Department of Justice declined comment.
US stocks had plunged Thursday on reports that a handful of hedge funds had withdrawn some money from Deutsche Bank due to concerns about its solvency.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.