FRANKFURT, June 29 Deutsche Bank said
it has settled a lawsuit with the U.S. city of Los Angeles that
accused the bank of allowing hundreds of foreclosed properties
to deteriorate into slum conditions and destabilise communities.
"The settlement will be paid by the (loan) servicers
responsible for the Los Angeles properties at issue and by the
securitisation trusts that hold the properties," the bank said
in a statement late on Friday.
"Deutsche Bank is not contributing any funds toward the
settlement," it said, without disclosing any financial details.
"Deutsche Bank did not admit any liability or wrongdoing as
part of the settlement, and continues to dispute the claims
asserted by the City," it added.
A statement from Los Angeles City said it has secured $10
million in civil penalties as part of settlement of the lawsuit
it filed in May 2011.
During the housing boom and subsequent bust, Deutsche Bank
subsidiaries acquired more than 2,000 properties in Los Angeles,
according to the city's 2011 civil enforcement action.
The city accused Deutsche of becoming one of its largest
"slumlords," allowing vacant properties to turn into nuisances,
neglecting to maintain occupied properties, and illegally
evicting low-income tenants to clear the way for a sale.
Los Angeles is one of many cities in the United States
grappling with the problem of blighted properties after a wave
of foreclosures that followed the housing bust.
It has passed a law requiring banks to fix the blighted
homes they own, or pay a fine, but enforcing that has proven
In April this year a judge denied Deutsche Bank's bid to
dismiss the lawsuit, allowing Los Angeles to proceed with its