Deutsche Bank’s outgoing joint chief executive Anshu Jain was embroiled in a furious row yesterday with German financial regulators over a bonus of millions of euros that was paid to a former star trader.

BaFin, the watchdog, accused Mr Jain, who has just stepped down as co-chief executive of Deutsche, of personally lobbying for the bonus for Christian Bittar, who is now part of a criminal investigation into alleged benchmark-rigging.

A BaFin report said senior management at Deutsche had a “remarkable” relationship with Mr Bittar. It said Mr Jain pressed for a bonus as high as €130 million for him and another trader, telling the bank’s chairman at the time they were “good guys, the best on the street”.

Last night, Deutsche denied the allegations, saying Mr Jain’s comments were taken out of context and Mr Bittar was contractually entitled to an even higher bonus and had in fact deferred half of it. The disclosure is made in a report written by BaFin in the wake of the Libor scandal.

Deutsche is one of several banks to have paid over $9 billion in fines to settle claims they rigged Libor, a benchmark that underpins about $350 trillion of debt worldwide. Deutsche paid a record $2.5 billion in penalties over Libor in April.

Mr Jain ordered an internal investigation to see whether the high profits generated by Mr Bittar and the money-markets desk were genuine, but it was superficial, BaFin alleged. Mr Bittar, who left the bank in 2011, is under investigation by the UK’s Serious Fraud Office as part of its criminal probe into the rigging of Euribor, the Brussels equivalent of Libor. No charges have been filed against Mr Bittar, who denies all wrongdoing.

The bank rejected the allegations that Mr Bittar and Mr Jain had a close relationship and that the internal review was insufficient. It also denied that Mr Jain had lobbied for a higher bonus for Mr Bittar. “No one needed to lobby for those involved to be paid a bonus because they had contracts which entitled them to a percentage of the profits they generated,” it said. “Rather, the traders involved agreed to defer half of their entitlement given the circumstances of the financial crisis.”

Deutsche said these types of contracts were not uncommon in the market at the time but it no longer has them. Mr Bittar’s lawyer declined to ­comment. – Copyright The Financial Times Limited 2015