Deutsche Bank AG, Germany’s biggest bank, may face $118 million in U.S. penalties to cover taxpayer losses on a federally insured apartment loan owned and serviced by one of the company’s subsidiaries.

The $45.6 million multifamily loan, which was underwritten in 2003 by another lender and later acquired by the Frankfurt- based bank, cost U.S. taxpayers $29.8 million in losses to the Department of Housing and Urban Development’s mortgage insurance program, according to a report dated yesterday by HUD’s Office of Inspector General.

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Source: Bloomberg Businessweek