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Business

Deutsche Bank, Wells Fargo: banks back in the hot seat

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Business

Deutsche Bank, Wells Fargo: banks back in the hot seat

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COMING UP:Deutsche Bank, Wells Fargo: banks back in the hot seat

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Transcript

00:00:02
>> Bad mortgages, phony accounts, government fines. Banks this week having flashbacks to the 2007 financial crisis. On Friday, shares of Deutsche Bank lost a combined $2 billion after the institution announced it would not pay a record $14 billion fine to the US Department of Justice. US Financial Services Editor, Carmel Crimmins.
00:00:23
>> This is a case that dates right back to the financial crisis. It's all about the packaging and selling of mortgage assets, they were repackaged into bonds. These products were at the heart of the financial crisis. Investors were misled about the credit worthiness of these products, how well the homeowner was gonna be able to repay the loan.
00:00:41
>> The Deutsche Bank sell off comes on the heels of a growing investigation into Wells Fargo's 2 million phantom accounts, which has wiped nearly $25 billion from the bank's market value in just five days.>> The tone in Washington is indeed anti-bank right now. And we've seen it, it's also an election year, right, which is also significant.
00:01:01
We've had both candidates be very keen to bash the banks.>> All this, as the focus on banks behaving badly is about to get more intense. Congress will begin grilling executives of Wells Fargo in the coming week about their mishandling of that account scandal. Something the new laws put in place after the crisis was supposed to prevent from happening.