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Deutsche Bank logo is seen in this illustration taken March 12, 2023. REUTERS/Dado Ruvic/Illustration/File Photo Acquire Licensing Rights
FRANKFURT, Oct 2 (Reuters) – Germany’s top financial regulator is appointing a supervisor to Deutsche Bank (DBKGn.DE) to oversee how the lender addresses customer service issues after the integration of its Postbank arm left clients complaining that they were locked out of their accounts and unable to reach call centres.
The head of the regulator BaFin has said the troubles at Postbank were “unacceptable”, and had threatened possible repercussions for Deutsche.
Consumer protection groups have reported complaints of Postbank customers not having access to their funds for weeks and direct debits getting rejected, jeopardising their credit scores.
The issue is a setback for Deutsche Bank’s effort to restore credibility after fines for lapses in money laundering controls, raids by authorities and other penalties.
BaFin already had a monitor in place at Deutsche to oversee money laundering controls since 2018.
“We are making progress in improving processing times at Postbank as part of the action plan agreed with BaFin,” Deutsche Bank said in a statement. A spokesperson said the issue was of the “highest priority”.
Deutsche began the acquisition of Postbank, with its millions of clients and roots in the country’s postal system, in 2008 during the global financial crisis but struggled for years to integrate it.
The bank said in July it had completed a final phase of the integration, but in September, BaFin in an unusual rebuke said it had seen “considerable disturbances” at Postbank.
In 2019, Deutsche, one of the world’s most important banks, embarked on a four-year, nearly 9-billion euro ($9.5 billion) turnaround plan after years of losses.
The effort helped restore profit, but the bank’s share price has languished and reputational issues have continued to surface.
The U.S. Department of Justice last year extended the stay of its own separate monitor at Deutsche.
Deutsche Chief Executive Officer Christian Sewing has said Deutsche had made mistakes on Postbank and that it had devoted hundreds of additional workers to tackle the issues.
“We have not lived up to our responsibility,” Sewing said last month.
The Federation of German Consumer Organisations, which seen a surge in complaints at the bank, said that many customers had lost patience with Deutsche and called on the bank to fully compensate clients .
Deutsche said it would review each case and compensate for damages “attributable to us”.
BaFin said the special monitor would report back regularly and remain until the issues were fully fixed.
“The aim of the measure is to quickly restore normality for customers,” a spokesperson for the regulator said.
($1 = 0.9451 euros)
Reporting by Tom Sims;
Editing by Miranda Murray, Kirsten Donovan, Emelia Sithole-Matarise and Louise Heavens
Our Standards: The Thomson Reuters Trust Principles.
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