Deutsche Bank shares rise 4% after settlement of bulk of claims in long-running Postbank suit

Deutsche Bank has reached settlements with nearly 60% of plaintiffs in a long-running case alleging the German lender underpaid for its acquisition of Postbank more than a decade ago.

In a Wednesday statement, Deutsche Bank said it had reached agreements with more than 80 plaintiffs for a settlement of 31 euros ($34.53) per share, as proposed by the bank. This will allow Germany's largest lender to release the funds and boost Deutsche Bank's anticipated third-quarter pretax profit by 430 million euros, it said.

Deutsche Bank shares were up 3.95% at 4:25 p.m. in London, around their highest level for a month.

The stock dropped sharply following the bank's second-quarter results released July 24, in which it reported its first net loss in four years, largely due to a 1.3 billion euro provision for Postbank cases.

That includes the largest individual plaintiff representing around a third of claims, the bank said Wednesday.

Suits were brought against Deutsche Bank by a range of institutional and private investors claiming that it underpaid in its multistage acquisition of Postbank, a German retail bank with millions of clients. The institutions merged in 2018.

Settlement agreements with additional plaintiffs could result in "further positive implications on the total provisions taken for the litigation," the bank said.

"We are pleased with the settlements we announced today, which substantially reduce the cost and risk of the Postbank takeover litigation and have a positive impact on our earnings and capital position," a Deutsche Bank spokesperson said.

"Against the backdrop of this improvement to our capital plan, we will review our distribution plans and discuss these with our regulators as part of our ongoing dialogue. As before,