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Deutsche Bank Exodus Continues As Real Estate Chief Leaves For Blackstone

Tyler Durden's picture




 

Earlier this month, Deutsche Bank’s co-CEOs Anshu Jain and Jürgen Fitschen were shown the door (well, technically they resigned, but with shareholder support plummeting amid skepticism about both financial targets and ongoing legal problems, it’s easy to read between the lines). The bank, which has paid out more than $9 billion over the past three years alone to settle legacy litigation, has become something of a poster child for corrupt corporate culture. Consider the following rundown of the legal problems the bank faced as of the beginning of its 2015 fiscal year:

We are currently the subject of regulatory and criminal industry-wide investigations relating to interbank offered rates, as well as civil actions. Due to a number of uncertainties, including those related to the high profile of the matters and other banks’ settlement negotiations, the eventual outcome of these matters is unpredictable, and may materially and adversely affect our results of operations, financial condition and reputation. 

 

A number of regulatory and law enforcement agencies globally are currently investigating us in connection with misconduct relating to manipulation of foreign exchange rates. The extent of our financial exposure to these matters could be material, and our reputation may suffer material harm as a result. 

 

A number of regulatory authorities are currently investigating or seeking information from us in connection with transactions with Monte dei Paschi di Siena. The extent of our financial exposure to these matters could be material, and our reputation may be harmed. 

 

Regulatory and law enforcement agencies in the United States are investigating whether our historical processing of certain U.S. dollar payment orders for parties from countries subject to U.S. embargo laws complied with U.S. federal and state laws. 

 

We have been subject to contractual claims, litigation and governmental investigations in respect of our U.S. residential mortgage loan business that may materially and adversely affect our results of operations, financial condition or reputation.

In April, Deutsche settled rate rigging charges with the DoJ for $2.5 billion (or about $25,474 per employee) and subsequently paid $55 million to the SEC (an agency that’s been run by former Deutsche Bank employees and their close associates for years) in connection with allegations it deliberately mismarked its crisis-era LSS book to the tune of at least $5 billion. 

But it was out of the frying pan and into the fire so to speak, because early last month, the DoJ announced it would seek to extract a fresh round of MBS-related settlements from banks that knowingly packaged and sold shoddy CDOs in the lead up to the crisis. JP Morgan, Bank of America, and Citi settled MBS probes when the DoJ was operating under the incomparable (and we mean that in a derisive way) Eric Holder but now, emboldened by her pyrrhic victory over Wall Street’s FX manipulators, new Attorney General Loretta Lynch is set to go after Barclays PLC, Credit Suisse Group AG, Deutsche Bank AG, HSBC Holdings PLC, Royal Bank of Scotland Group PLC,UBS AG and Wells Fargo & Co. 

With the bank facing yet another settlement that could run into the billions and with both CEOs on the way out, the exodus continues as Bloomberg reports that Jonathan Pollack, the bank’s global head commercial real estate, is leaving after 16 years. Here’s more:

Pollack departed on Friday, according to a company memo. Amanda Williams, a Deutsche Bank spokeswoman, confirmed the contents of the memo and declined to comment further. Pollack who was based in New York, didn’t immediately return telephone calls seeking comment.

 

(Pollack)

 

Pollack took the helm of Deutsche Bank’s commercial mortgage bond business in 2011 and helped make it Wall Street’s top underwriter of securities linked to real estate from strip malls to skyscrapers. The bank’s ascent coincided with the rebirth of the roughly $550 billion market for packaging real estate debt into bonds and selling it to investors. Sales of such securities had frozen for more than a year in the wake of the financial crisis.

Pollack's departure comes just one month after the bank's head of structured finance Elad Shraga left to start his own fund. Shraga was instrumental in helping Deutsche become "an award-winning arranger of asset- and mortgage-backed debt." Shraga had been with Deutsche Bank for 15 years. 

All of this seems to lend credence to the idea that Deutsche Bank may be in trouble. The employee exodus appears to be gathering steam, while the firm's legal troubles show no signs of abating. Indeed the bank's headquarters were raided just last week by authorities searching for information on client tax evasion.

Considering all of the above, one cannot help but be reminded of William Broeksmit, the former head of capital and risk optimization at Deutsche Bank who tragically took his own life in his South Kensington home in late January of 2014. Prior to committing suicide, Broeksmit told a psycologist that he was, in WSJ's words, "anxious about various authorities investigating" the firm. 

Of course if Deutsche Bank does find itself up against the wall, it can always call in a few favors from former employees turned SEC officials turned high-profile attorneys like Robert Khuzami but as we noted last year, "it is usually best to just avoid litigation altogether, which is why perhaps sometimes it is easiest if the weakest links, those whose knowledge can implicate the people all the way at the top, quietly commit suicide in the middle of the night..." 

*  *  *

After the US market close, Bloomberg reported that Pollack will now join Blackstone as CIO of the firm's property debt unit, and will report to Michael Nash who's in charge of debt strategies. This means Pollack will set about securitizing landlord and home flipper loans in no time. Recall that Deutsche Bank was set to be the lead underwriter for the first landlord loan-backed securitization. 

 

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Mon, 06/15/2015 - 19:31 | 6200027 Evil Bugeyes
Evil Bugeyes's picture

Rats leaving a stinking ship.

Mon, 06/15/2015 - 19:37 | 6200041 johngaltfla
johngaltfla's picture

Nah. Blackstone has more virgins for these ratfuckers to pork.

Tue, 06/16/2015 - 02:51 | 6200924 Zero Point
Zero Point's picture

Haha Blackstone is basically trading insolvent. Good luck Deutche douche fuckhead.

Tue, 06/16/2015 - 07:34 | 6201074 HowdyDoody
HowdyDoody's picture

Shareholders sue CEOs for financial losses they caused in 3 . 2 .. 1 .... yeah right.

 

Mon, 06/15/2015 - 21:46 | 6200334 Tall Tom
Tall Tom's picture

I sonder what type of MBS Derivative exposures he leaves behind...

 

Does DoucheBUNK translate to Toxic Waste Dump? Or is that just an idiomatic construation?

 

If I owned stock in a Toxic Waste Dump then it is a decent time to dump that waste.

 

Perhaps it is a decent time to lever some short trade against this?

 

Nah. What would you end up with? I know. A whole bunch of hyperinflated fiat that you could wipe your ass with.

 

(At least you would not have to worry about running out of toilt paper ala Venezuela and Argentina. There is a bright side after all.)

 

Germany needs to be sanctioned, isolated, and cut off. That is the only hope of containment of their bad Derivatives bets.

 

Nahhh...We will all die of this Cancer. The World Currencies will spread the malignancy just like the blood stream and Lymphatic System spreads cancer within the Human Body.

 

The prognosis is terminal.

Mon, 06/15/2015 - 22:05 | 6200381 waterwitch
waterwitch's picture

Anyone buying puts on DB?

Tue, 06/16/2015 - 03:09 | 6200928 Tall Tom
Tall Tom's picture

Not me. I refuse to participate in fraudulent markets.

 

Principles beore profits. Ill gotten gains lead to one's own demise.

 

You can if you choose.

 

Knock yourself out.

Mon, 06/15/2015 - 19:46 | 6200072 Bangin7GramRocks
Bangin7GramRocks's picture

His picture just makes me want to smash his fucking face.

Mon, 06/15/2015 - 20:33 | 6200161 Sages wife
Sages wife's picture

Not surprising. Young Dick Fuld.

Mon, 06/15/2015 - 21:20 | 6200275 H. Perowne
H. Perowne's picture

This face begs for a nailgun.

Mon, 06/15/2015 - 22:48 | 6200508 walküre
walküre's picture

or the Carhartt stamp of disapproval .. you know to stick with the theme of construction and real estate.

Mon, 06/15/2015 - 19:48 | 6200078 junction
junction's picture

The applicable cliche is rearranging the deck chairs on the Titanic.  As the world economy heads towards the abyss, you have monsters like prosecutor Loretta Lynch stealing money outright using bogus structuring charges and also arranging "protection racket" type payoffs from the big banks.  Big banks who worked hand in glove with corrupt politicians like Senators Gramm and Schumer and President Clinton to legalize the creation and sale of worthless derivatives.

Mon, 06/15/2015 - 20:03 | 6200109 williambanzai7
williambanzai7's picture

The whole thing is one big TBTF rotten bratwurst, saved by the FED using AIG as a fucking sump pump. Run by a bunch of clueless douchebag top tier wannabes trying to replicate the Wall Street Fed sanctioned fraud template, it became a prime target for Goldman Sachs rejects.

 

 

Tue, 06/16/2015 - 03:11 | 6200929 giovanni_f
giovanni_f's picture

Makes for a good T-shirt motive.

Tue, 06/16/2015 - 03:20 | 6200935 Al Gophilia
Al Gophilia's picture

Ah, c'mon. He was just taking orders. Just doing his job, the poor schlub.

Mon, 06/15/2015 - 19:34 | 6200032 This is it
This is it's picture

What? He didn't jump??

Mon, 06/15/2015 - 23:17 | 6200581 Bunga Bunga
Bunga Bunga's picture

Still looking for a higher building.

Mon, 06/15/2015 - 19:36 | 6200038 jarana
jarana's picture

Whatever is in the vaults, DoItCheck Bank.

Next.

Mon, 06/15/2015 - 19:40 | 6200049 Grande Tetons
Grande Tetons's picture

Looks like Carol Channing fucked The Joker.  

Anyhow, good to be back. 

Mon, 06/15/2015 - 19:44 | 6200059 TeethVillage88s
TeethVillage88s's picture

I'll be here all week. Badumpbump.

Mon, 06/15/2015 - 20:02 | 6200107 TeethVillage88s
TeethVillage88s's picture

Actually there is a Transsexual weirdo that posts to social websites a picture of himself to shock people.

This guy might be the same guy.

Weirdest stuff you ever saw.

Mon, 06/15/2015 - 20:08 | 6200115 Grande Tetons
Grande Tetons's picture

Probably some ex-decathelete who holds a high office at the NAACP. 

Tue, 06/16/2015 - 01:30 | 6200835 Fish Gone Bad
Fish Gone Bad's picture

Probably just another American Psycho.

Mon, 06/15/2015 - 19:41 | 6200053 kaiserhoff
kaiserhoff's picture

All banks are in trouble.  Deutsche and AIG are just the most troubled.

Mon, 06/15/2015 - 19:42 | 6200054 Fun Facts
Fun Facts's picture

bad color of eye shadow

Tue, 06/16/2015 - 20:42 | 6203984 StychoKiller
StychoKiller's picture

Hmm, and I was just wondering about his lipstick color! :>D

Mon, 06/15/2015 - 19:43 | 6200057 22winmag
22winmag's picture

If this isn't a global circle jerk of of financial criminals, I don't know what is.

Mon, 06/15/2015 - 19:48 | 6200076 Amish FinEng
Amish FinEng's picture

How many of you have the greasy slick back hair look?

The Amish do not approve of this vanity.

Mon, 06/15/2015 - 19:57 | 6200100 dumdum
dumdum's picture

 

 

I tried it. It didn't work for me. I kind of looked a little sleazy, kind of like a banker or real estate agent.

Mon, 06/15/2015 - 19:59 | 6200104 TeethVillage88s
TeethVillage88s's picture

I would too, man. It just would not work for me. Thanks for the comment.

Mon, 06/15/2015 - 19:58 | 6200102 TeethVillage88s
TeethVillage88s's picture

Just do the Pubes, man. Just do the Pubes, then it is a non-issue. S/

I probably need an Amish Wife. I know I am wild, but I need someone to take care of me...

Mon, 06/15/2015 - 19:56 | 6200096 TeethVillage88s
TeethVillage88s's picture

"new Attorney General Loretta Lynch is set to go after Barclays PLC, Credit Suisse Group AG, Deutsche Bank AG, HSBC Holdings PLC, Royal Bank of Scotland Group PLC,UBS AG and Wells Fargo & Co."

What about Lloyds & Anglo-Irish Bank??

"Anglo Irish Bank was an Irish bank headquartered in Dublin from 1964 to 2011.[1] It began to wind-down after nationalisation in 2009.[2] In July 2011, Anglo Irish merged with the Irish Nationwide Building Society, forming a new company named the Irish Bank Resolution Corporation."

"Lloyds Bank plc is a British retail and commercial bank with branches across England and Wales. It has traditionally been considered one of the "Big Four" clearing banks.[2] Originally founded in Birmingham in 1765, the bank expanded during the nineteenth and twentieth centuries and took over a number of smaller banking companies. In 1995 it merged with the Trustee Savings Bank and traded as Lloyds TSB Bank plc between 1999 and 2013.

The bank is the principal subsidiary of Lloyds Banking Group, which was formed in January 2009 by the acquisition of HBOS by the then-Lloyds TSB Group.[3] That year, following the UK bank rescue package, the British Government took a 43.4% stake in Lloyds Banking Group. "

Tue, 06/16/2015 - 01:03 | 6200797 Bay of Pigs
Bay of Pigs's picture

Good one Teeth...

What a fuckan circle jerk this is.

Mon, 06/15/2015 - 20:01 | 6200106 dumdum
dumdum's picture

 

 

Of course they're in trouble, there's no doubt about it.

Rats fleeing a sinking ship.

Where there's smoke there's fire.

And so on.

Mon, 06/15/2015 - 20:15 | 6200128 Amish FinEng
Amish FinEng's picture

Does your Donald Trump character have any single daughters?

Tue, 06/16/2015 - 19:32 | 6203779 mkhs
mkhs's picture

 

Are you looking for a toxic waste dump?

Mon, 06/15/2015 - 20:19 | 6200137 dreadnaught
dreadnaught's picture

How about TBTS for a change-Too big to save....

Mon, 06/15/2015 - 20:35 | 6200162 Chad_the_short_...
Chad_the_short_seller's picture

If this was pre-08, I would get really excited and buy a ton of puts on DB. Yes, they are in trouble and loaded to the max with 75 trillion in derivatives. But lets be honest here, if DB was allowed to go down, the entire financial system would go down. The ECB and FED would print $500 trillion to save them.

Mon, 06/15/2015 - 20:35 | 6200163 Chad_the_short_...
Chad_the_short_seller's picture

If this was pre-08, I would get really excited and buy a ton of puts on DB. Yes, they are in trouble and loaded to the max with 75 trillion in derivatives. But lets be honest here, if DB was allowed to go down, the entire financial system would go down. The ECB and FED would print $500 trillion to save them.

Mon, 06/15/2015 - 20:46 | 6200193 Spectre
Spectre's picture

I'd like to knock out his two front teeth with a tire iron.

Mon, 06/15/2015 - 20:53 | 6200206 jerry_theking_lawler
jerry_theking_lawler's picture

Hopefully this fucker will go tits up and that DB little Joey LaVorgna will go broke, become homeless, and generally drift away into oblivion...

Mon, 06/15/2015 - 23:07 | 6200562 green888
green888's picture

does this mean Germany cannot bail out Greece ?

Mon, 06/15/2015 - 23:33 | 6200606 tarabel
tarabel's picture

That Jonathan Pollock looks exactly like the Impresario dude in Cabaret.

Money makes the world go around, the world go around, the world go around...

Mon, 06/15/2015 - 23:50 | 6200643 GRDguy
GRDguy's picture

Geez, one more sociopath joining a major gang of sociopaths. 

Tue, 06/16/2015 - 00:16 | 6200703 onmail
onmail's picture

Politicians (Angela Merkel et al ) can do anything to please their puppet master America. Even if it means damning their economy, their country etc. 

Tue, 06/16/2015 - 01:09 | 6200803 Government need...
Government needs you to pay taxes's picture

That's the kind of scum banksters are.  They pull the pin out of the grenade and then, without bothering to look for it, slink out of the area.

Tue, 06/16/2015 - 03:09 | 6200927 wildbad
wildbad's picture

buy a safe, withdraw all of your cash, buy gold and silver and bullets and canned corn.  install a bitcoin wallet and convert some euro / or dollars iinto the other one.  crack open a home brew and spread open the chaise lounge.  enjoy the untergang.

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