SEC Form 20-F - Deutsche Bank Annual Report 2012
SEC Form 20-F - Deutsche Bank Annual Report 2012
SEC Form 20-F - Deutsche Bank Annual Report 2012
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<strong>Deutsche</strong> <strong>Bank</strong> Notes to the Consolidated Balance Sheet F-134<br />
<strong>Annual</strong> <strong>Report</strong> <strong>20</strong>10 on <strong>Form</strong> <strong>20</strong>-F 28 – Provisions<br />
Asset Backed Securities Matters. <strong>Deutsche</strong> <strong>Bank</strong> AG, along with certain affiliates (collectively referred to as<br />
“<strong>Deutsche</strong> <strong>Bank</strong>”), has received subpoenas and requests for information from certain regulators and government<br />
entities concerning its activities regarding the origination, purchase, securitization, sale and trading of asset<br />
backed securities, asset backed commercial paper and credit derivatives, including, among others, residential<br />
mortgage backed securities, collateralized debt obligations and credit default swaps. <strong>Deutsche</strong> <strong>Bank</strong> is cooperating<br />
fully in response to those subpoenas and requests for information. <strong>Deutsche</strong> <strong>Bank</strong> has also been named as<br />
defendant in various civil litigations (including putative class actions), brought under federal and state securities<br />
laws and state common law, related to residential mortgage backed securities. Included in those litigations are (1)<br />
a putative class action pending in California Superior Court in Los Angeles County regarding the role of <strong>Deutsche</strong><br />
<strong>Bank</strong>’s subsidiary <strong>Deutsche</strong> <strong>Bank</strong> Securities Inc. (“DBSI”), along with other financial institutions, as an underwriter<br />
of offerings of certain securities issued by Countrywide Financial Corporation or an affiliate (“Countrywide”), as<br />
to which there is a settlement agreement that has been preliminarily but not yet finally approved by the Court,<br />
and a putative class action pending in the United States District Court for the Central District of California regarding<br />
the role of DBSI, along with other financial institutions, as an underwriter of offerings of certain mortgage passthrough<br />
certificates issued by Countrywide; (2) a putative class action pending in the United States District Court<br />
for the Southern District of New York regarding the role of DBSI, along with other financial institutions, as an<br />
underwriter of offerings of certain mortgage pass-through certificates issued by affiliates of Novastar Mortgage<br />
Funding Corporation; (3) a putative class action pending in the United States District Court for the Southern<br />
District of New York regarding the role of DBSI, along with other financial institutions, as an underwriter of<br />
offerings of certain mortgage pass-through certificates issued by affiliates of IndyMac MBS, Inc.; (4) a putative<br />
class action pending in the United States District Court for the Northern District of California regarding the role of<br />
DBSI, along with other financial institutions, as an underwriter of offerings of certain mortgage pass-through<br />
certificates issued by affiliates of Wells Fargo Asset Securities Corporation; (5) a putative class action in the<br />
United States District Court for the Southern District of New York regarding the role of a number of financial<br />
institutions, including DBSI, as underwriter, of certain mortgage pass-through certificates issued by affiliates of<br />
Residential Accredit Loans, Inc.; and (6) a lawsuit filed by the Federal Home Loan <strong>Bank</strong> of San Francisco<br />
(“FHLB SF”) pending in the United States District Court for the Northern District of California regarding the role of<br />
a number of financial institutions, including certain affiliates of <strong>Deutsche</strong> <strong>Bank</strong>, as issuer and underwriter of<br />
certain mortgage pass-through certificates purchased by FHLB SF. In addition, certain affiliates of <strong>Deutsche</strong><br />
<strong>Bank</strong>, including DBSI, have been named in a putative class action pending in the United States District Court for<br />
the Eastern District of New York regarding their roles as issuer and underwriter of certain mortgage pass-through<br />
securities. On April 5, <strong>20</strong>10, the Court granted in part and denied in part <strong>Deutsche</strong> <strong>Bank</strong>’s motion to dismiss this<br />
complaint. Each of the civil litigations is otherwise in its early stages.<br />
From <strong>20</strong>05 through <strong>20</strong>08, as part of our U.S. residential mortgage loan business, we sold approximately<br />
U.S.$ 85 billion of loans into private label securitizations and U.S.$ 71 billion through whole loan sales,<br />
including to U.S. government-sponsored entities such as the Federal Home Loan Mortgage Corporation and<br />
the Federal National Mortgage Association. We have been presented with demands to repurchase loans or<br />
indemnify purchasers, other investors or financial insurers with respect to losses allegedly caused by material<br />
breaches of representations and warranties. Our general practice is to process valid repurchase claims that<br />
are presented in compliance with contractual rights. Where we believe no such valid basis for repurchase claims<br />
exists, we reject them and no longer consider them outstanding for our tracking purposes. As of December 31,<br />
<strong>20</strong>10, we have approximately U.S.$ 588 million of outstanding mortgage repurchase demands (based on original<br />
principal balance of the loans). Against these claims, we have established reserves that are not material and<br />
that we believe to be adequate. As of December 31, <strong>20</strong>10, we have completed repurchases and otherwise settled<br />
claims on loans with an original principal balance of approximately U.S.$ 1.8 billion. In connection with those