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BANK

Swedish investors cool to risks of stock ownership

Swedes appear to prefer keeping their savings in the bank or under the mattress, rather than risk it in the volatile Stockholm stock market.

Small-time investors in Sweden transacted 36,300 stock trades a day in August, an increase of 1 percent from July, but a 16 percent drop compared to August of last year.

Normally private stock trading increases by about 10 percent after the summer months.

“Savers didn’t return to the stock exchange in August like they used to, but instead stayed away. This year on the stock exchange has been tough for savers who have had their patience and strength worn down,” said Claes Hemberg, a savings economist with internet brokerage Avanza, to the TT news agency.

Many investors have unloaded their shares in telecoms giant Ericsson, despite the fact that its stock price rise 12 percent in August.

And a 15 percent stock price rise in drug maker Astra Zeneca and a 25 percent hike for shares in packaging company Billerud still didn’t stop small investors from hitting the sell button.

“It’s a little strange since things have gone so well. When there is uncertainty in the market people should look for common stocks, but instead people are selling them. I think that is a very clear sign that people are skeptical about stocks in general,” said Hemberg.

The number of Swedes who own stocks has steadily decreased in recent years and is at its lowest level in eight years, according to Avanza.

“We’re getting close to having two million savers who own stocks. That can sound like a lot but there are many who only own a share in Ericsson or TeliaSonera. It’s an altogether older group who sell to use the money for their retirement,” said Hemberg.

“It’s probably the case that most Swedes aren’t made to own stocks. When there is this much uncertainty, people discover how hard it actually is. Mutual funds are simpler and not as sensitive. Bank accounts have also been winners in the last year.”

BANK

Deutsche Bank to pay $130m to settle US bribery probes

Deutsche Bank will pay $130 million to settle a foreign bribery probe and fraud charges in precious metals trading, US officials announced on Friday.

Deutsche Bank to pay $130m to settle US bribery probes
A woman walks past the offices of Deutsche Bank in London. Photo: Tolga Akmen / AFP
The bribery case relates to illegal payments and to false reporting of those sums on the bank's books and records between 2009 and 2016, the Department of Justice said in a press release.
   
The bank “knowingly and wilfully” kept false records after employees conspired with a Saudi consultant to facilitate bribe payments of over $1 million to a decision maker, the DOJ said.
   
In another case, the bank paid more than $3 million “without invoices” to an Abu Dhabi consultant “who lacked qualifications… other than his family relationship with the client decision maker,” the DOJ said.
   
In addition to criminal fines and payments of ill-gotten gains, Deutsche Bank agreed to cooperate with government investigators under a three-year deferred prosecution agreement.
 
   
In the commodities fraud case, Deutsche Bank metals traders in New York, Singapore and London between 2008 and 2013 placed fake trade orders to profit by deceiving other market participants, the DOJ said.
   
The agreement took into account Deutsche Bank's cooperation with the probes, DOJ said.
   
“Deutsche Bank engaged in a criminal scheme to conceal payments to so-called consultants worldwide who served as conduits for bribes to foreign officials and others so that they could unfairly obtain and retain lucrative business projects,” said Acting US Attorney Seth D. DuCharme of the Eastern District of New York.
   
“This office will continue to hold responsible financial institutions that operate in the United States and engage in practices to facilitate criminal activity in order to increase their bottom line.”
   
“We take responsibility for these past actions, which took place between 2008 and 2017,” said Deutsche Bank spokesperson Dan Hunter, adding that the company has taken “significant remedial actions” including hiring staff and upgrading technology to address the shortcomings.
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