FRANKFURT (Reuters) - Deutsche Bank has warned a protracted lawsuit claiming it underpaid for Postbank could cost Germany's largest lender up to 1.3 billion euros ($1.39 billion).

Deutsche acquired the no-frills Postbank during the financial crisis seeking to broaden its reach in Germany and a steady income stream after years of rapid international expansion.

Instead, Postbank has become a source of consumer complaints, regulatory scrutiny, labour strife and now, a possibly costly lawsuit.

Following are details on Deutsche's troubles with Postbank:

WHAT IS POSTBANK?

Deutsche began its acquisition of Postbank, with its millions of clients and roots in the country's postal system, during the 2008 global financial crisis.

Deutsche Bank now operates under two brands - with its blue Deutsche Bank logo and yellow Postbank signs - via hundreds of branches across Europe's largest economy.

WHAT'S THE LATEST PROBLEM FOR DEUTSCHE WITH POSTBANK?

Deutsche Bank unexpectedly announced on Friday that it would make a provision to offset possible claims in a years-long litigation that it underpaid Postbank shareholders in its acquisition of Postbank.

Deutsche Bank, which said it "continues to disagree strongly" with any view that it underpaid, said it would set aside an unspecified amount in the case.

Claims are for about 1.3 billion euros in damages, Deutsche said, adding the matter would impact its second-quarter and full-year profitability.

Deutsche in a separate announcement late on Sunday said it was too early to tell whether it would conduct another share buyback in 2024 in light of the unexpected developments.

It said it would "carefully assess" options for a possible settlement in litigation.

HOW ELSE HAS POSTBANK BEEN IN THE NEWS?

For years, Deutsche struggled to fully integrate Postbank, but it said last year that it had completed a final phase in the integration.

But glitches resulted in customers complaining they were locked out of their accounts for weeks, resulting in the regulator overseeing a clean-up and cuts in bonuses for some of Deutsche's top managers.

Deutsche has said that most of the issue has been dealt with but that more needs to be done.

WHAT ELSE?

As Deutsche deals with the consumer complaints, it has been involved in a months-long wage dispute with thousands of Postbank workers seeking a 15.5% pay raise.

A fourth round of negotiations ended without result, even after a cumulative 20 days of strikes.

Union members are in the process of voting on possible further strikes.

Deutsche Bank has declined to comment on the dispute.

($1 = 0.9324 euros)