“Deutsche Bank on Wednesday revised its 2012 profit sharply downward as it set aside more money to cover the potential cost of legal proceedings.
“Deutsche Bank, Germany’s largest lender, allocated an additional 600 million euros ($775 million) to cover its legal costs, a move that reduced its pretax profit for 2012 by the same amount. As a result, net profit for the year was 291 million euros ($376 million), about 400 million euros ($517 million) less than the bank reported on Jan. 31.
“Like many big European institutions, Deutsche Bank faces a long list of legal woes.
“It is dealing with numerous lawsuits related to its sales of mortgages and mortgage-related derivatives in the United States before the financial crisis. Ronald Weichert, a Deutsche Bank spokesman, cited those suits as the main reason for setting aside more money for legal expenses.
“The bank, based in Frankfurt, has also been ensnared by the global investigation into rate manipulation. In November, Deutsche Bank said it had set aside money for potential penalties related to rate rigging. Now, it appears the bank is increasing the buffer, partially in response to a string of recent settlements involving other banks.”
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