Deutsche to pay U.S., UK $2.5 billion over interest rate manipulation

WASHINGTON (Reuters) - Deutsche Bank will pay U.S. and British authorities $2.5 billion and its London subsidiary will plead guilty to wire fraud for manipulation of benchmark interest rates, U.S. authorities said on Thursday.

As part of the deal, Germany?s largest bank also entered into a deferred prosecution agreement with the U.S. Justice Department and admitted its role in manipulating the London Interbank Offered Rate (Libor).

The bank also agreed to terminate and ban employees who engaged in misconduct and will install an independent monitor, according to New York state's Department of Financial Services.

The $2.5 billion penalty includes $600 million to the New York regulator, $800 million to the U.S. Commodity Futures Trading Commission, $775 million to the U.S. Justice Department and $344 million to the UK's Financial Conduct Authority, authorities said.

(Reporting by Karen Freifeld in New York and Lindsay Dunsmuir and Susan Heavey in Washington. Editing by Bill Trott and Jeffrey Benkoe)

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