Deutsche Bank denies Greek financing questionable

FRANKFURT (Reuters) - Deutsche Bank DBKGn.DE on Saturday denied a magazine report that its financing of a Greek trade deal seven years ago was "questionable."

Germany’s Der Spiegel magazine reported that Deutsche Bank’s London branch had organized a “legal, but extremely questionable” transaction in 2003 in an arms deal that was cosmetically favorable for Greek government finances.

“We deny the accusation of questionability,” a Deutsche Bank spokesman said, adding that the deal involved normal goods trade financing.

Der Spiegel said that Germany's biggest lender had worked with Eurohypo, today a unit of Commerzbank CBKG.DE, on the transaction.

It quoted a Eurohypo spokesman as saying that Eurohypo had made good on a claim of about 1 billion euros against the Greek government in 2003, which was then repaid last year.

The role of banks in advising Greece on its finances has drawn scrutiny after the country’s public accounts were shown to be in a precarious state, triggering financial market ructions over whether the country might default and pressuring the euro.

U.S. regulators are probing how Wall Street firms like Goldman Sachs GS.N helped debt-stricken Greece arrange derivatives deals that critics say were used to disguise the size of its budget deficits.

The European Parliament also plans a public hearing on the unreliable Greek statistics and may invite representatives of the European Commission, euro area finance ministers, the European Central Bank, statistics agency Eurostat, the Greek government and Goldman Sachs to give their views.

The European Commission said in a report earlier this year that Greece’s statistics were unreliable and prone to political influence after a new government in Athens revealed that the country’s budget deficit would be 12.7 percent in 2009 - double the initially forecast amount.

Additional reporting by Patricia Uhlig