Deutsche Bank accuses Argentine bond holdouts of 'harassment'

Deutsche Bank has accused Argentina's holdout creditors of using subpoenas more to punish financial entities that have helped the country carry out financial transactions than to obtain information about the country's assets.

In a letter to Thomas Griesa, the New York district judge overseeing Argentina's legal battle with the bond holdouts, Deutsche Bank accuses the creditors of abusing the discovery process, adding that it had spent substantial time and expense responding in good faith to subpoenas.

"[The] true motivation is not discovery of relevant information but harassment of financial intermediaries," said the investment bank, according to a note by Credit Suisse.

Deutsche Bank also accused the holdouts of violating confidentiality orders, and asked the judge to reject the subpoenas, citing improper conduct, according to the note.

The subpoenas relate to efforts by the holdout creditors – led by investor Paul Singer's NML Capital – to prove that financial entities participated in the placement of Argentina's US$1.42bn "Bonar '24" bond in April.

The holdouts argued at the time that the nine-year bond should have been included in the pari-passu injunction, which calls on the country to pay the holdouts at the same time as bondholders which had previously exchanged their defaulted bonds in 2005 and 2010.