A report in Germany-based publication Focus Magazine alleged that the bank had bought shares in Douglas for a client in secret, overriding investment protocols.
In response the bank has refuted the allegations, claiming the magazine article gave a ‘false impression’ of the real set of events, although it did not deny that the transaction took place.
Bank claims everything was legal
The bank claims that it has met all legal obligations for disclosures on share trading, in turn claiming that the investment was neither in secret nor in any way illegal.
“The fact is, Bank Sarasin acquired its stake in Douglas Holding on its own and in order to hedge positions in its trading book,” said the bank in an official statement.
The story has thrown the Douglas name into the spotlight, particularly in the company’s native Germany, where it is a household name. Many of the major German newspapers, including The Financial Times - Germany edition, have run the story.
Douglas Holdings defies economic downturn
In its 2008/2009 financial year the company defied the market downturn thanks to its expansion plan into new international markets.
Sales for the 12 months ending in September were up 2.2 per cent to €.3.2bn, which represented an increase of just under 1.0 per cent on a like-for-like basis.
The results were helped by the fact that market share increased in the domestic market remained relatively buoyant, with sales in its international markets driven by new store openings.
Douglas had planned to open 50 new stores during the course of 2009 in order to expand the company’s presence in Italy, Poland, Russia and Croatia. New stores in Germany have also opened.