Some 170 police officers and investigators from the prosecutor´s office were searching six of the bank´s premises in and around the city, it added in a statement.
Deutsche Bank confirmed the raids and said it was “fully cooperating” with the authorities.
“The case is related to the Panama Papers,” it added.
The Panama Papers scandal that erupted in 2016 with a massive data leak from Panamaian legal firm Mossack Fonsenca exposed large-scale tax evasion, laying bare how the world´s wealthy and powerful stashed their assets in offshore businesses.
Deutsche Bank was among hundreds of financial institutions whose names cropped up in the media reports about the Panama Papers.
The Frankfurt prosecutors said their probe was focussing on two Deutsche Bank employees aged 50 and 46, as well as “several” unnamed senior staff members.
Based on information from the Panama Papers, they are accused of “failing to report suspicions of money laundering” linked to offshore firms involved in tax evasion “even though there was sufficient evidence” to suggest illegal activity, prosecutors said.
Shares in Deutsche Bank fell 2.7 percent to 8.36 euros by 1000 GMT, against a DAX blue-chip index up 0.6 percent.
