The move is a further sign that US regulators are taking a tougher approach with banks that are found to have broken US laws amid criticism that they have until now appeared “too big to bar”.
The three banks remain hopeful of convincing the regulator to grant them a waiver and are intensifying their efforts to provide more information and arguments in support of their case to keep their Qualified Professional Asset Manager status.
The regulator has previously granted such exemptions relatively quickly. Being stripped of their ability to manage money for US pensioners would be a damaging blow to the banks’ reputation in the world’s biggest financial market.
However, they said that such a move would have a limited financial impact on their operations as US pensioners account for a small proportion of the total assets they manage. In Deutsche’s case this is less than 1 per cent of its total assets.
Citigroup, JPMorgan and Barclays have also submitted requests for exemptions from the labour department to maintain their ability to manage money for US pensioners. Other banks with such requests outstanding include Credit Suisse and BNP Paribas.
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