The Federal Reserve has lifted the order it placed on Deutsche Bank's currency desk in 2017, and the conduct behind it goes back to 2008
Buried in a two line notice on Thursday morning is the end of one of the largest currency trading cases the Federal Reserve ever brought.
The Board of Governors announced at 11 a.m. Eastern that it had terminated its cease and desist order against Deutsche Bank AG, DB USA Corporation and Deutsche Bank AG New York Branch. The order was dated 20 April 2017. The termination took effect on 13 August, a week before it was announced, and the notice gives no reason for it.
What is ending is worth restating, because the announcement does not restate it. The 2017 order assessed a civil money penalty of $136,950,000, payable at execution by Fedwire to the Federal Reserve Bank of Richmond and passed on to the Treasury. It ran under six docket numbers, one cease and desist and one penalty docket for each of the three respondents.
What the order said the bank did
Every finding below is the order's, entered by consent before any notice of charges was filed and before any testimony was taken. Deutsche Bank waived a hearing and waived judicial review.
The Board found that during a review period running from October 2008 to October 2013, the bank lacked adequate governance, risk management, compliance and audit policies for its currency business. Traders in the spot market, the order says, routinely talked to traders at other financial institutions in chatrooms open to several banks at once. The deficient policies are described as having prevented the bank from detecting five kinds of conduct in those chatrooms: disclosure of trading positions and, on occasion, discussion of coordinated trading strategies with other institutions; discussion of trading around benchmark fixes; attempts to influence contributions to submission-based benchmarks in certain emerging market currencies; discussion of the bid and offer spreads quoted to customers on non-deliverable forwards in an emerging market currency; and trading intended to trigger or defend barrier options.
The order concludes from those failures that the bank engaged in unsafe and unsound banking practices. It also records that Deutsche Bank had reviewed the period itself, reported the conduct to the Board and to the New York Fed, and cooperated.
The clause that made Thursday possible
Paragraph 14 is the whole mechanism. Each provision of the order, it says, remains effective and enforceable until stayed, modified, terminated or suspended in writing by the Board of Governors. Nine years passed. Then it was terminated in writing.
Paragraph 15 is the one that has not changed. In 2017 the Board agreed not to bring further enforcement actions against Deutsche Bank and its affiliates over the currency conduct described in the order, so far as the Board knew of it at the time. That release was written to exclude proceedings against individuals who are or were institution-affiliated parties of the bank, and it still excludes them.
The other half of the notice
The same announcement executes a new action. SouthPoint Bancshares, Inc. of Birmingham entered a written agreement dated 14 August with the Federal Reserve Bank of Atlanta and the Alabama State Banking Department, under docket 26-010-WA/RB-HC. The recitals say the Reserve Bank's most recent offsite review identified certain deficiencies at the holding company, and that the FDIC and the state banking department had already entered a consent order with SouthPoint Bank on 4 November 2025.
The agreement requires the holding company to act as a source of financial and managerial strength to its bank under section 38A of the Federal Deposit Insurance Act, including by raising capital if the bank runs into trouble. A written capital plan is due to both supervisors within 60 days.
