Shares in German banking giant Deutsche Bank have come under heavy selling pressure in recent days.
This comes as traders digest the details of a fresh banking scandal.
Deutsche Bank shares have fallen from highs of almost EUR 10.00 in August. They are now at current lows around the EUR8.00 mark.
Implicated in Suspicious Transactions
The sell-off has occurred in response to reports of leaked documents revealing how major banks, including Deutsche Bank, worked with criminals to help them move capital around the world.
The International Consortium of Investigative Journalists (ICIJ) reviewed the documents, including over 2000 suspicious activity reports (SARs). These SARS were submitted by banks to authorities, and the ICIJ claims they were not properly handled.
The transactions in question amount to more than $2trillion in total. These took place over an 18 year period, between 1999 and 2017.
Shares in Deutsche Bank fell by 8% yesterday in response to the report. While they are around 0.13% higher pre-market today, sentiment remains heavy and further losses are likely.
Deutsche Bank One of the Key Names in Report
In total, the ICIJ reviewed over 17,000 files, including the more than 2000 SARs.
The files show that Deutsche Bank was responsible for facilitating around $1.3 trillion in suspicious transactions. This makes them one of the most heavily involved banks.
In comparison, rival banks such as JPMorgan appear to have facilitated around $500 billion in suspicious transactions.
It is important to note that the files themselves do not necessarily indicate any wrongdoing. However, if a subsequent investigation finds that the SARs were not properly handled, this changes the situation entirely.
Commenting on the reports, Deutsche Bank told CNBC:
“This is not new information to us or our regulators”
Latest in a String of Scandals
Despite Deutsche Bank’s position, investors are clearly concerned and the situation strikes yet another blow to the bank’s reputation.
Deutsche Bank recently had to pay a $150m settlement to the New York Department of Financial Services. This was over its dealing with convicted pedophile Jefferey Epstein.
Once again, in 2017, Deutsche Bank was ordered to pay a $7.2 billion fine. This time, it was for misleading investors over the sale of mortgage-backed securities in the period leading up to the global financial crisis.
Deutsche Bank Shares Break Below Trendline
Shares in Deutsche Bank have now fallen below the rising trend line from year to date lows and the 8.98 level which now turns to resistance.
While price remains below this level, the focus is on a continued push lower with the 775 level the next key support to note ahead of the deeper support level at 7.07.