SYDNEY, Sept 28 (Reuters) - Australia's Macquarie Group said on Friday its incoming and outgoing chief executives are expected to be interviewed by German prosecutors after the bank lent money to investment funds that engaged in a practice commonly known as dividend stripping.
The Sydney-based bank said in a statement the Cologne Prosecutor's Office was investigating a transaction whereby investment schemes traded in shares around dividend payment dates to obtain tax benefits.
Prosecutors will likely want to interview Macquarie's chief executive and CEO designate, Macquarie said. Long-serving CEO Nicholas Moore is due to retire in November, and will be replaced by current head of asset management Shemara Wikramanayake.
"In order to interview all these individuals, they are likely to be formally classified under German law as persons of interest or suspects," the statement said.
"Macquarie will continue to cooperate fully with the German authorities."
Earlier this year, German prosecutors charged the first suspects in a widespread and long-running financial market tax scam that has cost taxpayers billions of euros.
Macquarie said it acted as a lender to a group of funds involved in the share trading in 2011. It said it was one of over 100 financial institutions involved in this market, from which it withdrew in 2012.
It added the transaction amount that is being investigated by Cologne prosecutors is "not material," and that it has "provided for these matters."
Macquarie shares were down 1.1 percent on Friday afternoon in a broader Australian market that was up 0.3 percent. (Reporting by Paulina Duran in SYDNEY; Editing by Muralikumar Anantharaman)