Another setback for Germany's largest bank, Deutsche, as its co-CEO Juergen Fitschen begins a lengthy trial connected to the Kirch bankruptcy, in a week that's already seen a record fine for rate-rigging and eyebrows raised over the bank's restructuring plan. David Pollard reports.
It's an April Juergen Fitschen may want to forget. The Deutsche Bank co-CEO now going on trial in Munich. He and four others are accused of giving misleading evidence in a previous hearing - on the bankruptcy of the Kirch media empire. It's alleged he offered ''vague and inconclusive'' evidence to avoid paying damages sought by Kirch. The case stems from a TV interview in 2002 in which Fitschen's co-accused, one of his predecessors, Rolf Breuer, questioned Kirch's creditworthiness. Kirch blamed that for the media group's downfall. Fitschen, Breuer and another former Deutsche chief, Josef Ackermann, together with two other former executives, all deny the allegations. The charges could carry heavy penalties, according to a court spokeswoman. SOUNDBITE: SPOKESWOMAN MUNICH DISTRICT COURT, ANDREA TITZ, SAYING (German): "Serious fraud, which is the case here, foresees a prison term of up to ten years. But whether there will be any convictions and if so, what kind, we will of course have to wait and see. After all, this is about attempted fraud so the range of sentences is smaller." The start of the trial caps a week of pain for Fitschen and his bank. Last week, US and UK regulators levied a 2.5 billion dollar fine against Deutsche for manipulating interest rate benchmarks. And on Monday, a long-awaited restructuring plan got an apparent thumbs down - with a sharp sell-off in Deutsche shares. BGC market analyst, Mike Ingram. SOUNDBITE: BGC MARKET ANALYST, MIKE INGRAM, SAYING (English): ''The bottom line is Deutsche restructuring, heading in the right direction, but far too slowly. They need to do more in order to de-risk, downsize and rationalise the investment bank and generally rein back on its cost structure and in the absence of increasing the ROE, increasing the internal equity generation in the bank, questions will remain over its capital strength.'' Fitschen's strength may also be under scrutiny. He's vowed to fight the allegations in a case that's scheduled to run until at least September.