FRANKFURT/MADRID – Spanish supervisor CNMV has fined Deutsche Bank 3 million euros ($3.3 million) after finding the German lender had applied significantly higher spreads on clients’ repurchases of structured bonds it issued and failing to disclose the fact.
On Tuesday, the Spanish government said in its official bulletin that the fine related to a “very serious infringement”, without identifying the name of clients or the potential case it was referring to.
The issue is unrelated to one that involves the suspected mis-selling of risky investment bank products to customers in Spain that has resulted in a lawsuit and investigations.
Deutsche said it would appeal against the fine, the highest penalty in Spain since November 2018, when the CNMV fined Santander 4.5 million euros for improperly charging incentives to investment clients, according to public records from the supervisor.
According to the government gazette, Deutsche Bank had not applied the required measures to manage the “existing conflict of interest in the repurchase from clients of structured bonds issued by Deutsche Bank Group, applying significant spreads compared to their fair value of which customers were not informed.”
The German lender said it had acted correctly in this situation, “applying conflict of interest management policies and taking additional measures in accordance with the regulations in force at the time of the events inspected”.
($1 = 0.9048 euros)
(Reporting by Tom Sims in Frankfurt and Jesús Aguado in Madrid; Editing by Louise Heavens and Jan Harvey)
