The German lender has been dealing with disgruntled shareholders since its acquisition of Postbank fourteen years ago. Now, it claims to have made “significant progress”.
Deutsche Bank has reached settlements with more than 80 plaintiffs in a lengthy legal dispute relating to its takeover of Postbank in 2010.
Following the acquisition, a number of Postbank stakeholders claimed they were underpaid for their assets when offered €25 per Postbank share.
A number of claimants say they should have been offered €57.25 or higher.
In a statement late on Wednesday, Deutsche Bank said it expects a €430m boost to its third-quarter, pre-tax profit thanks to the legal breakthrough.
To reach the settlements, which represent about 60% of claims against the lender, Deutsche Bank paid €31 per Postbank share.
This consumes around 45% of the €1.3bn provision that the bank had set aside to cover the claims.
“Should Deutsche Bank enter into settlement agreements with additional plaintiffs, this could result in further positive implications on the total provisions taken for the litigation,” Deutsche Bank noted on Wednesday.
In April, the lender decided to create a financial buffer when an appeals court warned it may rule in favour of the plaintiffs.
Dismayed shareholders argue that Deutsche Bank should have made an offer for their assets when it first took a stake in Postbank in 2008.
At the time, Postbank’s shares were trading at €57.25, a value that had then decreased by the time of the 2010 takeover.
In 2011 and 2012, claims against Deutsche Bank were rejected in court – although the verdict was later nullified by Germany’s Federal Court of Justice.
Deutsche Bank lost a trial related to the same incident in 2017 but then launched an appeal, provoking another wave of lawsuits.
Source: Euro News
