Foreign Exchange Disclosures

Deutsche Bank AG (acting through its various branches and its affiliates, “Deutsche Bank”) would like to highlight certain matters relating to Deutsche Bank’s role in foreign exchange (“FX”), precious metals (“PM”) and base metals (“BM”, and together BM and PM are “metals”) markets. It is important that customers read this disclosure to understand how Deutsche Bank may trade in relation to their orders, requests for quotation (“RFQ”), trade instructions, or other expressions of interest in fixed income products (collectively “trade requests”). This document sets out our standard business practices and terms and conditions of dealing with our FX and metals customers and establishes the basis on which we can provide our customers with pricing and execution of their trade requests.

Further terms specific to other fixed income products are addressed in Deutsche Bank’s “Fixed Income Disclosures”. Listed derivatives traded on an agency basis are not addressed in this disclosure, except where expressly stated otherwise.

Deutsche Bank’s Role in Relation to its Customers

General

Deutsche Bank acts as principal for FX and/or metals transactions, in an arm’s-length role in relation to its customers, and does not act as agent, fiduciary or in any advisory capacity for any transaction, except as expressly agreed in writing beforehand. Each customer (or its agent) should independently evaluate for the benefit of the customer the appropriateness of a transaction. This evaluation should include, among other things, the transaction’s terms and conditions and take into account the customer’s objectives and circumstances.

It is important for customers to note that markets and the value of FX and/or metals transactions may go down as well as up and the past performance of a product or transaction is no guarantee of future returns. FX and/or metals transactions are subject to investment risk, including market fluctuations, regulatory change, counterparty risk, possible delays in repayment and loss of income and principal invested.

Other Roles and Interests

Acting in a capacity which is separate to its role as principal for FX and/or metals transactions, Deutsche Bank may enter into other transactions with a customer, provide finance to a customer, act as a customer’s agent, advise a customer on a transaction, or enter into transactions or perform such roles for third parties in transactions in relation to which a customer is a party (“Other Transactions”). When acting in such a capacity Deutsche Bank’s role as principal in relation to such FX and/or metals transactions with a customer, as set out above, is unaffected.

This continues to apply when Deutsche Bank is providing FX and/or metals transactions as hedging (“Hedging Transactions”) in relation to Other Transactions (to such customer or to third parties) and Deutsche Bank will act as a principal in relation to any Hedging Transaction. Deutsche Bank may enter into Hedging Transactions with more than one party to an Other Transaction or any similar transaction to which Deutsche Bank is not a party.

In relation to any FX and/or metals transaction (including any Hedging Transaction), Deutsche Bank may make a profit or a loss in the circumstances where the Other Transaction proceeds, or when it does not proceed, based on market movements, our general market positioning, the terms of the Hedging Transaction, any risk management transactions we have entered into in connection with any Hedging Transaction, and/or any other transaction. Any compensation, return or profit may be equal to or greater than the compensation payable to Deutsche Bank in consideration for its role in relation to Other Transaction(s).

Customer Trade Requests

General

Deutsche Bank is not under any obligation to accept and act upon any customer trade request, subject to any applicable terms and conditions. Except as may be required by such terms and conditions or applicable law, Deutsche Bank may return an accepted trade request to the customer at any time, and acceptance of a trade request does not oblige Deutsche Bank to enter into any transaction with a customer, in whole or in part. However, Deutsche Bank’s general practices in relation to acceptance of trade requests received through an electronic platform are as set out below, subject to any applicable terms and conditions.

Market risk is considered transferred to a customer at the time the relevant trade request is filled by Deutsche Bank and this may be prior to receipt of communication by a customer in relation to the relevant transaction.

Electronic trading

When a customer transmits a trade request to Deutsche Bank on any electronic platform (including any platform operated by a third party), Deutsche Bank may apply a risk control mechanism in order to verify validity (comprised of limits on counterparty exposure, credit checks, permissioning of currency pairs, and other controls) and/or price in order to establish if a trade request is accepted or rejected.

These controls employed to determine trade acceptance are referred to collectively as “last look.”  Deutsche Bank does not apply an additional hold time over and above the time taken to complete price and validity checks. The “last look window” as used in this section means the time taken to complete the price and validity checks.

The price check feature of last look is a control that is used to confirm whether the price at which the trade request was made remains consistent with the current price that would be available to the customer. The time required to perform the price check will be up to 10 milliseconds, based on the time taken to establish the current price, which is subject to factors such as technological anomalies and latencies, geographical location, and the products traded. Where trading activity is less affected by these factors the duration of the price check may be reduced.  

Deutsche Bank operates four methods of configuring the operation of the price check, being “asymmetric”, “symmetric”, “symmetric with price improvement” and submission of “at latest” orders. Any of these methods may be selected by a customer, subject to electronic platform functionality and procedures not controlled by Deutsche Bank.

• The asymmetric price check rejects a trade request when the requested price deviates from the current price in favour of the customer (and against Deutsche Bank) by more than a configured price tolerance.
• The symmetric price check rejects a trade request when the requested price deviates from the current price in favour of either the customer or Deutsche Bank by more than a configured price tolerance.
• The “symmetric price check with price improvement” methodology differs from the symmetric price check in that Deutsche Bank will not reject a trade request (for reasons of price) where the requested price deviates from the current price in favour of Deutsche Bank by more than a configured price tolerance. Instead, Deutsche Bank will accept the trade request at the current price thereby passing on price improvement to the customer.
• The “at latest” methodology is similar to a market order in that the trade request does not specify a particular price and will be executed at the current price prevailing for that customer (subject to validity checks). A protective circuit-breaker-like price band may be applied to prevent executions when pricing moves away in either direction (in favour of or against the customer) by more than a configurable threshold from the price level when the trade request is received.

In assessing these methods, customers may wish to consider the methodology of the price check method itself, the associated execution risk and exposure to price slippage. In this context, execution risk refers to the likelihood of failing to execute following submission of a trade request and price slippage refers to the difference between the price selected by the customer or applicable when a trade request is submitted and the actual price of execution received. It is important to note that any comparison of these methods is only valid if all other factors are equal other than the price check methodology. These issues can be considered as follows:

• The application of the asymmetric price check may result in a lower proportion of trade requests being accepted where the price moves against Deutsche Bank at the point where the price check is performed than where the price moves in its favour. This means that the execution risk is lower than where a symmetric price check or at latest with protective banding applies but higher than at latest without a protective band. There is no risk of price slippage associated with this method.
• A choice of a symmetric price check will result in Deutsche Bank rejecting trade requests where the price moves beyond the relevant tolerance for that customer at the point the price check is performed, regardless of whether the price moves in favour of or against Deutsche Bank on that trade request. This means that the execution risk is comparable to at latest with a protective band but greater than where an asymmetric price check applies (or where a symmetric price check with price improvement applies). There is no risk of price slippage associated with this method.
• A choice of symmetric with price improvement results in Deutsche Bank not rejecting trade requests where the price moves in Deutsche Bank’s favour. The execution risk associated with this methodology is therefore lower than where a symmetric price check or at latest with protective band applies, comparable to where an asymmetric price check applies, but higher than where at latest without protective band applies. There is potential price slippage in favour of the customer with this option, but not against the customer. A customer would need the technology (or a third party connectivity provider) to be able to handle price improvements in order to select this option.
• In relation to the at latest price check option without a protective band, the risk of rejection of a trade request for reasons of price is eliminated, but there is greater risk of price slippage than the other options.
• A choice of at latest with a protective band results in higher execution risk than where no protective band is applied (or the asymmetric or symmetric with price improvement checks) but comparable to the symmetric price check. While there is risk of slippage, this is limited by the application of the protective band which ensures a reject on trade requests that fall outside the band

The above description is summarized in the table below.

* Please note that this table is a summary and for a fuller explanation customers should refer to the text above.

If a customer does not express a preference for a price check methodology, then Deutsche Bank employs the asymmetric price check because:

• it leads to fewer trade rejections and therefore less execution risk compared to the symmetric price check where other factors are equal;
• there is no risk of price slippage, unlike the at latest options and the symmetric plus price improvement method; and
• it does not require the technological capability to handle potential price slippage associated with the symmetric plus price improvement or at latest price check methods.

The liquidity provided, the proportion of trade requests that are rejected and the duration of the price check are reviewed periodically by Deutsche Bank. The factors applicable to one customer and its trading may differ from those applicable to other customers and may lead to differences in pricing, liquidity, duration of price check and acceptance rates among customers.

The validity check comprises elements such as (without limitation) limits on counterparty exposure, credit checks, permissioning of currency pairs, and other controls. The duration of the validity check may be affected by latencies (on networks or on Deutsche Bank’s internal systems), the Deutsche Bank system used (or connected to) by the customer, market liquidity, geography, time of day, product and currencies (and/or metals).

As such, the precise duration of the validity check and thus the overall duration of the last look window can be highly fact dependent and variable. Deutsche Bank expects, based on analysis of aggregated data from a period in 2022, the majority (greater than 99.9% of transactions) of business conducted over an electronic platform to have an overall last look window in the range of 0.2-102 ms. For Deutsche Bank’s most optimised platform the upper end of this range is reduced significantly.

The duration of the last look window (and the component of it comprising the price check) may differ for products other than spot foreign exchange.

The durations stated above (even those which are based on aggregated data) or otherwise provided to customers assume the normal functioning of markets, systems and other infrastructure. Technical problems, failures or disruption of infrastructure, systems and/or disrupted markets may extend the duration of the last look window beyond the durations stated above.

Pricing not Continuous

In periods of extreme market volatility and/or disruption, Deutsche Bank has on some occasions seen delays to trades, including acceptance and execution of trade requests, pricing, price streaming and/or market data dissemination. Further, Deutsche Bank’s provision of pricing is subject to internal procedures and controls in relation to system or other issues which disrupt the ability of Deutsche Bank’s system to provide accurate and/or up to date pricing.

Deutsche Bank is not obligated to provide pricing, price streaming or accept trade requests and all determinations of if, whether, or when market criteria have been met for execution shall be made by us in our sole discretion.

In line with market practice, Deutsche Bank's electronic trading platforms have position limits, volatility and other controls, that in each case may temporarily suspend execution, pricing and price streaming. It is possible that different customers submitting trade requests with similar profiles may achieve different outcomes, including whether and when such trade requests will be executed.

During volatile and/or disrupted markets, we will endeavour to continue to serve customers but we may not be able to provide the product offering, level of execution, liquidity and pricing - including in electronic markets - as would be the case under more normalized market conditions.

Customer Pricing

Any price provided by Deutsche Bank (in relation to any type of customer trade request, including but not limited to any take profit order, stop loss order (together “resting orders”)) may be inclusive of bid-ask spread, a mark-up determined by Deutsche Bank to be appropriate for the customer and the type of transactions that the customer executes with Deutsche Bank and/or other costs or fees included in the price provided by Deutsche Bank (such as, but not limited to, any component of pricing related to small transaction size), in each case allowing Deutsche Bank to earn an appropriate return for its activities.

Deutsche Bank is not under any obligation to disclose the specific amount of any bid-ask spread and/or mark-up to a customer (unless otherwise agreed in writing or required by law).

In determining any pricing (or any component of pricing), Deutsche Bank may consider factors such as liquidity of the transaction type in prevailing markets, the size and/or complexity of the transaction, credit costs, balance sheet and capital usage, risk limit utilisation, trade processing costs, sales efforts and any other relevant considerations. As these factors may vary, Deutsche Bank may offer different prices to different customers for the same or similar transactions or components of such transactions.

Further, Deutsche Bank may vary pricing for various reasons, including for commercial purposes; for technological or platform reasons; or to manage the market impact and other effects of the bank's pricing. For any given customer, different pricing may apply to different types of trade requests depending upon the factors noted above. Deutsche Bank may also be compensated in the form of an agreed fee.

Pricing provided by Deutsche Bank may be based upon (or include) pre-determined pricing for tiered levels of: liquidity, volume, maturity, currency pair or other relevant factors, with each relevant tier having a corresponding price (sometimes known as a pricing ladder).

Customer Information

Deutsche Bank may use the economic terms of customer trade requests and transactions internally and provide such information to third parties to accomplish transaction execution, risk management and other goals. Deutsche Bank limits such use and disclosure in a manner consistent with applicable law.

Deutsche Bank may need to determine appropriate pricing by sourcing liquidity from a Deutsche Bank trading desk or by transacting with third parties. In addition, as Deutsche Bank will manage the resulting risk of a requested transaction (including market, liquidity and credit risks) on an individual, portfolio, or other basis, it may be necessary for Deutsche Bank to execute one or more risk mitigating transactions. To facilitate this activity, Deutsche Bank may internally share economic terms relating to a customer’s trade request to persons acting in a sales or trading capacity for Deutsche Bank (or one of its affiliates or agents).

With regard to executed transactions, Deutsche Bank reviews the economic terms on an individual transaction and aggregate basis to assess the impact on relevant factors, such as market, liquidity and credit risks. Deutsche Bank may use information regarding the economic terms of individual transactions to tailor Deutsche Bank’s provision of products and services to its customers. Deutsche Bank may use information regarding executed transactions and unexecuted trade requests (other than market orders and trade requests subject to last look controls) and other available information regarding market conditions to shape Deutsche Bank’s overall market views and pricing. Deutsche Bank uses such information, on an anonymised and aggregated basis, internally and communicates it (with potential categorisation as to product, geography and/or industry) to customers that may find such information useful in managing FX and/or metals related risks and entering into transactions. All information provided to a customer by Deutsche Bank (unless already in the public domain) should be treated as confidential and should not be disclosed by a customer to any third party.

Please note that Deutsche Bank has regulatory and other duties to supervise and control its business. Deutsche Bank shares information as necessary to fulfil these responsibilities and respond to general and specific regulatory and other requests with which it is required to comply.

Deutsche Bank Trading

General

Deutsche Bank may execute transactions for its own account or for the benefit of other customers prior to execution of any trade request that a customer has placed with Deutsche Bank. Deutsche Bank may also engage in risk management activities prior to (including immediately prior to) executing a transaction with a customer (sometimes referred to as “pre-hedging”) or at the same time as executing a transaction.

These risk management activities may include trading in the same product, metals and/or currencies, trading in correlated products, metals and/or currencies, and establishing derivatives positions on any of the foregoing, and may also take account of other sources of exposure (such as market dislocations and disruptions). These risk management activities may also include using unexecuted trade request information (aggregated where possible) in Deutsche Bank’s pricing, as long as such usage is not intended to disadvantage a customer.

However, unexecuted trade requests which are subject to last look controls are not used to inform Deutsche Bank’s trading, for pre-hedging, in other risk management activity, or in determining Deutsche Bank's pricing, during the period of operation of such controls unless Deutsche Bank has agreed with a customer that: (i) it will fill the customer’s trade request by first entering into offsetting transactions in the market; and (ii) the volume traded in the last look window will be passed on to the customer in its entirety.

Where Deutsche Bank engages in pre-hedging the following key principles apply:

• Pre-hedging may be executed prior to, including in the seconds and minutes before, or at the same time as, any transaction with a customer;
• In engaging in pre-hedging Deutsche Bank will act as a principal, expects to take on market risk associated with such activity and such activity is undertaken at Deutsche Bank’s own risk;
• Deutsche Bank will seek to ensure any such activity is reasonable relative to the size and nature of the anticipated transaction (or portfolio of transactions) taking into account prevailing market conditions (such as liquidity);
• Deutsche Bank’s intention in undertaking any such activity will be to minimise the impact of the activity on the market and to facilitate the transaction (or portfolio of transactions);
• Pre-hedging will be undertaken with the intention to benefit the customer(s) and executed in a manner that is not intended to disadvantage the customer(s);
• Any pre-hedging by Deutsche Bank may negatively impact price or liquidity with respect to the execution of a transaction with a customer (or portfolio of transactions) and these impacts may be greater during times of low liquidity in the relevant market(s) and/or product(s); and
• Pre-hedging may take place at a portfolio level or otherwise than on an individual transaction or individual client basis.

Execution of Trade Requests

When Deutsche Bank receives a trade request such as, but not limited to, a resting order, Deutsche Bank’s acceptance of the trade request indicates a willingness to attempt to complete the requested transaction, in whole or in part, subject to prevailing market conditions, Deutsche Bank’s overall order book and risk management needs, and other relevant factors. Trade requests may be aggregated, executed proportionately, rounded, time prioritized or prioritised and filled in line with prevailing liquidity and/or other relevant circumstances as applicable. The application of mark-up may impact the liquidity that can be provided by Deutsche Bank in connection with filling a customer’s trade request and/or may also result in a trade request not being filled.

For resting orders, Deutsche Bank reserves the right to retain all or part of any price improvements in the market. For trade requests executed at “market,” any upside or downside fluctuations in the price at the time of execution may be passed to customers.

Deutsche Bank strives to ensure trade requests in the form of orders are appropriately time stamped and the following is a statement of Deutsche Bank’s general practice in time stamping such orders and may be subject to case by case and geographical variations. Orders submitted to Deutsche Bank through an electronic interface, platform or connection will be time stamped when they are submitted and when they are accepted. Orders submitted to a Deutsche Bank salesperson will be entered manually and there may be a short delay between the point of acceptance and the time stamping of the order in Deutsche Bank’s records. Once captured in one of Deutsche Bank’s order books such orders will be time stamped when any amendments are made and when the order is executed.

Deutsche Bank may receive multiple trade requests from different parties and Deutsche Bank retains discretion as to how to meet such requests, including timing, priority, pricing, aggregation and completeness of execution. As noted above, Deutsche Bank may need to hedge its exposure arising from the requested transaction or transactions for other customers which may impact prevailing pricing prior to, at, or after execution of the customer’s trade request. Deutsche Bank will use its judgement based upon available market and internal information, including, but not limited to, available price levels and actual liquidity available during circumstances such as a disruption event, to determine whether the parameters of a trade request have been satisfied and the extent to which the requested amount of a trade request can be satisfied under prevailing conditions to enable execution of a transaction in whole or in part. Deutsche Bank may also use execution tools that may cause it to enter into prior transactions in the process of executing trade requests.

When a customer instructs Deutsche Bank to work a trade request over any period of time or to otherwise execute at a level that is not yet determined, Deutsche Bank will seek to execute the trade request at a price that is reasonable given any relevant factors, including but not limited to, the prevailing market conditions. In doing so, Deutsche Bank may enter into risk management transactions at different times and prices to be able to execute the trade request. In executing any trade request, Deutsche Bank may have recourse to internal or external sources of liquidity at its discretion.

Electronic Execution Tools

Deutsche Bank may elect (on a trade by trade or systematic basis) to execute trade requests (of all types, including orders, such as those agreed to be executed on an “at best” basis) by means of algorithms, internalisation engines and/or other electronic execution tools (collectively, “execution tools”) and/or customers may request Deutsche Bank to execute by means of a specific execution tool designated by the customer. For the avoidance of doubt, unless agreed otherwise in writing Deutsche Bank will always act as principal in respect of any transaction executed by means of an execution tool. In all cases, the applicable execution tool will proceed to seek execution of a customer’s trade requests by means of a predetermined methodology for the relevant execution tool, which may be determined by Deutsche Bank.

The use of an execution tool in relation to a customer’s trade request does not guarantee any particular outcome and/or execution of any amount requested. Customers should ensure that any execution tool that they designate in an instruction to Deutsche Bank is appropriate for their needs. Deutsche Bank is not responsible for Customer’s choice of execution tool or evaluating Customer’s goals in selecting any execution tool. The output or offering of any execution tool is not investment advice or a recommendation. The results obtained from any execution tool may depend on the validity of the assumptions underlying it and prevailing market conditions may impact these assumptions.

Deutsche Bank has published an additional disclosure (the Foreign Exchange Algorithmic Execution and Aggregation Disclosure) for customers of its FX and/or metals algorithmic and aggregation services, the contents of which may be updated from time to time. The link to this document is set out above.

Deutsche Bank may benefit from reduced transaction costs when executing through certain internal or external trading venues and, if we have an investment in, or other relationship with, an external venue, Deutsche Bank may receive other benefits as a result of that interest.

Market Making

Deutsche Bank is a global dealer in FX and metals for a full range of products including spot, forwards, and derivatives. While handling customer trade requests, Deutsche Bank may continue to establish, maintain, modify and terminate positions for its own account in the same products in which its customers trade to ensure that it has sufficient capacity to meet anticipated customer demand or respond to market movements. Deutsche Bank is a market maker across currencies, metals and products, with employees trading across global locations on a continuous basis whenever markets are open for trading. As a result, subject to internal controls relating to the use of customer information and compliance with applicable laws and regulations, Deutsche Bank’s global activities may result in a Deutsche Bank trading desk or individual trader other than the one handling the trade request of a given customer executing a transaction for the benefit of Deutsche Bank or another customer at a price that could satisfy the original customer’s trade request.

Deutsche Bank’s market making activities may be based on the ideas of its traders, sales staff, research staff, as well as on public information sources. The ideas that form the basis of Deutsche Bank trading decisions are often shared with Deutsche Bank customers as trade ideas or market colour, upon which Deutsche Bank customers may or may not act. It is possible, therefore, that Deutsche Bank could have positions for its own account that are the same, similar, different or opposite to the positions of its customers.

The price for a customer’s trade request or transaction may be impacted, adversely or favourably, by Deutsche Bank executing transactions for its own account or with another customer, as part of its market making activities or in the circumstances indicated above in General and Execution of Trade Requests. Such transactions executed by Deutsche Bank may be in the same products, metals and/or currencies as the customer’s trade request or transaction or in other products, metals and/or currencies. Further, customers should be aware that Deutsche Bank may enter into, unwind, terminate, or close out all or part of a transaction with a third party at any time. This may occur before, during, or after the time at which: (i) the value of a transaction with a customer is determined; (ii) the value of an external market fixing or benchmark to which the transaction makes reference is determined; or (iii) either Deutsche Bank’s or its customer’s rights are capable of being triggered or exercised with respect to a transaction. They may affect whether provisions of a transaction are triggered such as option strike prices, barriers or resets, and may affect baskets or indices, negatively or positively affecting the value of a transaction to a counterparty.

Large Trades

From time to time a customer or Deutsche Bank may propose to enter into a transaction or set of transactions, which is, or together are, substantially larger than the observed liquidity in the relevant product market around the time of execution, and which could be reasonably expected to have a material impact on prices in the market or related markets (a “Large Trade”). This is a relative, rather than absolute, concept.

In relation to any Large Trade:

• (i) Deutsche Bank and a customer may discuss execution strategy, for example timing or potential market impact of the transaction;
• (ii) Deutsche Bank and a customer may propose steps designed to manage confidential information flows related to the Large Trade;
• (iii) Deutsche Bank and/or a customer may discuss market performance, for example where the market performs or may perform in an unexpected manner;
• (iv) notwithstanding any discussion of the matters outlined in (i)-(iii) above, each of Deutsche Bank and the customer will act as a principal, not as an agent, fiduciary or in any advisory capacity for any Large Trade unless otherwise agreed in writing; and
• (v) if Deutsche Bank has agreed to act in an agency capacity (including in our listed derivatives and clearing business), it may also discuss criteria that may prompt a discussion to pause, break up into smaller lots or terminate/pull the relevant Large Trade.

Customers should note that the execution, or risk management, of a Large Trade may have an impact on the market which affects the price of any instrument traded by the customer (including the Large Trade and any other transaction with Deutsche Bank or a third party)  and that past performance, pricing, observed liquidity or other variables immediately prior to making a trade request for a Large Trade is no guarantee of future outcomes with respect to such variables. It is possible that the market behaves in an unexpected manner in relation to the execution and/or risk management of a Large Trade. These factors could have a material impact on the effective cost the customer incurs in relation to any Large Trade or other transactions it enters into from time to time.

Given that (A) customers may be regular participants in financial markets and have their own views on these topics; (B) customers may not wish to discuss their views on these topics with Deutsche Bank; (C) customers may choose to execute through channels with no or little human interaction trade by trade; and (D) the concept of a Large Trade is relative, a majority of Large Trades may be executed without any such discussions. If a customer contemplates that the transaction or set of transactions it is proposing to enter with Deutsche Bank may constitute a Large Trade it should seek to initiate a pro-active discussion on these matters with its Deutsche Bank contacts if it would like to discuss these matters further.

Reference Prices and High/Low Rates

Reference prices may be used to determine the observed market level that may trigger resting orders, order limits, fixings, algorithmic orders, option strike prices, barriers or other contingent events in relation to a transaction. In addition, Deutsche Bank may, from time to time, establish a high and/or low rate for a spot currency pair. Reference prices and high and/or low rates (each a “Reference Rate”) may be established based on factors which may include (without limitation): currency, liquidity, time of day, size, tenor and prevailing market conditions. Reference Rates may be determined, obtained or derived from transactions executed by Deutsche Bank in its wholesale foreign exchange business (whether electronically or voice executed), central bank rates, wholesale interbank quotes (such as those available from Refinitiv, EBS, Bloomberg and equivalents), other publicly available fixing sources and may also be derived from Deutsche Bank models.

Deutsche Bank may use Reference Rates in determinations related to filling or triggering contingencies in relation to the order and transaction types listed above or otherwise. In any such determinations, the primary market for each currency pair is determined by Deutsche Bank.

There may be circumstances where a transaction has been executed (in the market or by Deutsche Bank) at a rate subsequently determined to be different to the relevant Reference Rate established by Deutsche Bank. Deutsche Bank may not execute any or all of a customer’s trade request, including where Deutsche Bank establishes a high or low rate for a currency pair at or through a customer’s trade request level.

Trade requests for Benchmark Prices at Specified Fixing Times

Trade requests for transactions whose pricing is set by reference to certain FX and metals benchmarks can create additional concerns for transaction execution and management of related risks. The discussion below relates to rates that are calculated by a third-party service at a specified time of day, such as WM/R benchmarks.

Following a trade request to execute a customer transaction at a benchmark rate, Deutsche Bank faces the challenge of finding an appropriate method of hedging Deutsche Bank’s exposure arising from transacting at a price that is not yet known and will not be determined until the closing of a specified determination period (referred to as the “Fixing Window”). Risk management practices will often result in execution of hedging transactions prior to. during and after the Fixing Window itself because of a number of factors, including, but not limited to, changes in the full amount and direction of customers’ orders prior to the Fixing Window and variations in markets during this period. Given that other market participants may face the same challenge, the volume of transactions prior to or during the Fixing Window may increase, and such transactions may impact the ultimate benchmark fixing (and may also impact pricing and volatility of related markets). Without limitation, and where practicable, Deutsche Bank’s general business practice is to execute customer trade requests for spot transactions at a benchmark rate by means of a Deutsche Bank execution tool, (see “Electronic Execution Tools” above).

Deutsche Bank engages in other ordinary course of business activities that may impact a benchmark rate, including sourcing liquidity for other customer orders that are unrelated to a benchmark fixing, or acting as a market maker or engaging in risk management activities. Such activities may cause Deutsche Bank to execute unrelated transactions prior to or during a Fixing Window or at other times that may impact transactions relating to a benchmark fixing and may also impact pricing and volatility in related markets.

While the above describes transaction-based benchmarks, benchmark rates may also be published by central banks, or compiled from dealer surveys (such as those sponsored by the Emerging Markets Traders Association), either in the ordinary course or as a fall back in the event that the ordinary course source for the benchmark rate is not available. Deutsche Bank may participate in dealer surveys. While these submission-based benchmarks differ from the transaction-based benchmarks discussed above, in the event that Deutsche Bank may act as both a submitter and transact in relation to such benchmarks Deutsche Bank has established controls designed to mitigate or avoid potential conflicts of interest.

Reporting practices in relation to “FX Swaps”

Please see the disclosures in relation to the reporting of FX swaps and forwards under European regulation, the contents of which may be updated from time to time.

Liquidity Provider Cover Sheet

The Global Foreign Exchange Committee (GFXC) requested that all foreign exchange liquidity providers complete a cover sheet prepared by the GFXC in relation to their wholesale foreign exchange market making activities. Deutsche Bank published its response to this request below.

GFXC Liquidity Provider Disclosure Cover Sheet