Deutsche Bank Surges on Report U.S. Mortgage Settlement Is Near

(Bloomberg) -- Deutsche Bank AG shares jumped the most in two months after a media report that Germany’s largest lender is nearing a settlement deal with U.S. authorities on an investigation into the sale of residential mortgage-backed securities.

The Department of Justice will send a 100-page statement of facts to the bank at the beginning of next week, Manager Magazin reported, without saying where it got the information from. Deutsche Bank’s fine might be higher than Goldman Sachs Group Inc.’s penalty of $2.38 billion, the German magazine reported.

“There is some light at the end of the tunnel," said Andreas Plaesier, an analyst at Warburg Research. “It’s good news for investors that Deutsche Bank is about to solve this issue. If the reported amount of above 2.38 billion is true, that would be in line with expectations,” he said.

Settling the U.S. case would clear a major legal hurdle for Germany’s biggest lender, which has already paid more than $9 billion in fines and settlements worldwide since the start of 2008, according to data compiled by Bloomberg. Chief Executive Officer John Cryan has pledged to resolve the largest of the firm’s outstanding cases this year.

Deutsche Bank shares rose as much as 5.3 percent and traded 5.1 percent higher at 13.78 euros as of 1:24 p.m. in Frankfurt.

A Deutsche Bank spokeswoman declined to comment when contacted by Bloomberg.

Deutsche Bank, which had 5.5 billion euros ($6.2 billion) set aside for settlements and fines at the end of June, will probably face “material” litigation charges in the second half, Chief Financial Officer Marcus Schenck told analysts in July.

Other unresolved cases include the alleged manipulation of foreign exchange rates and controversial equities trades in Russia.