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Deutsche Bank Series: Part 1, HBJ and Qatari Emir Buy Stake in Deutsche Bank Using Offshore Vehicles

Posted: November 6th, 2017 continues our deep dive research into the Qatar Investment Authority (QIA) and the Al Thani royal family of Qatar. Deutsche Bank Logo Today we are highlighting a substantial investment made by the former prime minister of Qatar, Hamad bin Jassim bin Jaber Al Thani (known by his initials “HBJ”) and his cousin the seventh Emir of Qatar, Hamad bin Khalifa Al Thani.

Beginning in June 2014, HBJ and his family used an investment vehicle based in the British Virgin Islands, widely regarded as a tax haven, to acquire 5.8% of Germany’s biggest bank—Deutsche Bank AG. HBJ’s investment came at a critical time, allowing Deutsche Bank to secure an EUR 8 billion stock offering in 2014. In August 2015, HBJ transferred some of his shares to Supreme Universal Holdings Ltd., a Cayman Islands company owned by the Emir Hamad Bin Khalifa, who acquired 3.05% of Deutsche Bank.

HBJ’s Paramount firm invests in Deutsche Bank

In June 2014, HBJ’s BVI-based firm Paramount Services Holding Limited acquired 5.8% of Deutsche Bank. The acquisition was structured as a capital increase and 59.9 million new shares were issued to Paramount at EUR29.20 per share, for a total sale price of EUR 1.75 billion. Deutsche Bank’s relevant disclosure with the Securities and Exchange Commission (SEC) described the deal thus:

SEC Disclosure Excerpt

The Paramount investment was “crucial” because it allowed Deutsche Bank to secure an EUR 8 billion stock offering in 2014. Per Bloomberg: “The share sale is crucial to the bank’s ability to meet stricter rules on capital and retain its position as a global bank, co-Chief Executive Officer Juergen Fitschen told shareholders at the annual meeting on May 22 [2014].”

Paramount's direct parent is Panama-based Treetop Family Foundation Inc., according to an SEC disclosure pertaining to the deal. Per the same disclosure, both Paramount and Treetop Family Foundation are beneficially owned and controlled by the former prime minister of Qatar and one-time head of the QIA, Hamad bin Jassim bin Jaber Al Thani (“HBJ”).

The SEC disclosure featured the electronic signatures of HBJ’s proxies. HBJ’s personal assistant Fakirahmed Gulam Mohiddin Kaldane (often simply called Gulam M. Kaldane) signed on behalf of Paramount Services Holding Limited. The Lebanese-French lawyer Fady Bakhos (described as “HBJ's right-hand man”) signed on behalf of Treetop Family Foundation Inc. as well as HBJ personally. See below for an excerpt of the disclosure’s signature line.

SEC Disclosure Excerpt featuring signatures discussed above

However, the SEC disclosure did not mention that Treetop Family Foundation is also linked to HBJ’s family—including his sons Jassim and Mohammad along with one of HBJ’s wives called Noor Abdulaziz Abdulla T. Al Subaie. Per Treetop’s bilingual Panamanian incorporation document:

Panamanian Incorporation Document Excerpt

HBJ’s Paramount transfers shares to Hamad Bin Khalifa

In August 2015 Hamad bin Jassim's Paramount transferred approximately half of its shares to Supreme Universal Holdings Ltd., a Cayman Islands company owned by the seventh Emir of Qatar, Hamad Bin Khalifa Al Thani. Following the transaction, Paramount and Supreme each held 3.05% of Deutsche Bank’s shares.

Deutsche Bank Annual Report 2015 excerpt, PDF link above, Deutsche_Bank_20_F_2015.pdf, see page 81

Our next post looks at how the Qatari royals increased their stakes in Deutsche Bank.