BERLIN (Reuters) – Deutsche Bank AG (NYSE:) said a court ruling in a years-long lawsuit over its Postbank takeover will require the company to make a legal provision that will affect profitability in the second quarter and throughout year.
Germany’s top lender said the Cologne High Court on Friday had reviewed claims by certain former Postbank shareholders that a higher offer price should have been paid for the 2010 takeover.
“During the hearing, the Court indicated that it may consider elements of these claims valid in a later ruling,” the bank wrote.
“While Deutsche Bank continues to strongly disagree with this assessment, the court’s rulings will impact Deutsche Bank’s assessment of the likelihood of a future outflow, resulting in a regulatory provision in the second quarter of 2024.”
This provision would impact Deutsche Bank’s profitability and capital ratios in the second quarter and the full year, the report said.
The estimate of the full amount of all Postbank shareholder claims, including cumulative interest, is approximately 1.3 billion euros ($1.39 billion). A spokesperson says this is the ceiling for the provision, which has not yet been determined.
“Overall, management does not expect any significant impact on the bank’s strategic plans or financial objectives,” the report said.
In 2008, Deutsche Bank bought a stake in Postbank of almost 30 percent for 57.25 euros per share. While Deutsche Bank gradually increased its stake over the following years, the financial crisis was in full swing and Deutsche Bank’s bid for the remaining shares was halved, irritating Postbank’s smaller shareholders.
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The lawsuit has been going on in German courts since 2011.
($1 = 0.9350 euros)
