(CS) German financial institution HSH Nordbank reportedly reached a 22-million-euro settlement with prosecutors in Cologne over setting up offshore companies through Luxembourg to hide client assets from tax authorities.

Newspaper “Süddeutsche Zeitung” and broadcasters NDR and WDR first reported on the deal on Tuesday.

Allegedly, HSH Nordbank approached the prosecutor's office to report the activities of its former Luxembourg subsidiary, following a search at Commerzbank for similar offences.

According to media reports, HSH Nordbank helped clients hide money through its Luxembourg branch, by setting up dummy companies in Panama between 2005 and 2011, when the subsidiary was sold. However, HSH Nordbank continues to be active in the Grand Duchy.

Neither the prosecution nor the bank have commented on the settlement, citing ongoing proceedings. “Süddeutsche Zeitung”, however, reports that the bank intended to inform its board about the deal on August 27.

The majority shareholders of HSH Nordbank are the City State of Hamburg and the State of Schleswig-Holstein, two of Germany's 16 federal states.

The German Hypo-Vereinsbank (HVB) several weeks ago reportedly agreed to a 20-million-euro settlement for helping clients evade taxes through Luxembourg.

According to “Süddeutsche”, in addition to HSH Nordbank, HVB and Commerzbank, three further large financial institutions, two of them in state hands, are under investigation.

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