According to reports from Germany, Deutsche Bank announced that it has settled $7.2 billion agreement with US establishments over a probe into mortgage-backed securities.
However the mentioned amount, which is yet to get a final endorsement, is way lower than the $14 billion the US had asked the lender to pay in September.
That pending fine had raise fears that a letdown of the bank could pose a risk to the international fiscal system.
The transaction of housing mortgage-backed securities played a significant role in the 2008 fiscal catastrophe.
Meanwhile in the recent times many lenders in the US have been under investigations over accusations of giving mortgages to unqualified borrowers, then repackaging those credits as safe investments and selling the risk on to others. The investigations covers the deals done between 2005 and 2007.
Under the agreement, Deutsche’s payment will be made up of a civil fine of $3.1 billion as well as $4.1 billion in customer relief that will help US homeowners.
Other lenders which have been asked to pay charges by the US Department of Justice comprise Citigroup which say its $12 billion fines dropped to $7 billion.
Back in 2013, JP Morgan Chase was charged $13 billion after allegations it exaggerated the quality of mortgages being sold to investors and not just that in 2014, Bank of America paid $16.7 billion to settle similar charges.
In January of 2016, Goldman Sachs reportedly settled for $5.1 billion.