Deutsche Bank’s plan to sell its India retail business is facing hurdles due to sharp decline in its wealth management operations.
The wealth business AUM has fallen from $4 billion when the sale began in August to nearly $1 billion now.
The deal may focus on selling loan assets, deposits and branches rather than a sizeable wealth management franchise.
Deutsche Bank's India Retail Business Sale Hit by Shrinking Assets in Wealth Unit
The wealth business' assets under management fell from $4 billion when the sale began in August this year to nearly $1 billion now
Deutsche Bank’s India Retail Business Sale Faces Challenges amid Shrinking Wealth Assets Shutterstock
Summary
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The planned sale of Deutsche Bank's entire retail banking business in India is facing challenges, mainly due to a reported decline in the size of its wealth management operations.
When Deutsche Bank formally began the sale process in August this year, its wealth management business in India had assets under management (AUM) of around $4 billion. However, Moneycontrol has now reported that the AUM may have reduced sharply since then to about $1 billion.
As a result, the proposed transaction may now focus on selling parts of the retail franchise, including loan assets, deposits and branch outlets, rather than its wealth business.
According to the report, Deutsche Bank's India retail operations include a loan book of about ₹12,000 crore, deposits of nearly ₹20,000 crore and around 17 branches. The valuation being discussed is said to be in the range of ₹3,000-5,000 crore.
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Several senior executives leading Deutsche Bank's India wealth business, including the chief executive and his immediate team, reportedly left the company after the sale plan was announced. Some of these executives may have joined a standalone wealth management platform and that certain clients and portfolios moved along with them.
The wealth business includes a loans-against-shares (LAS) unit, which may not easily fit into a standalone banking business structure, Moneycontrol reported citing sources.
According to earlier reports, Kotak Mahindra Bank and Federal Bank have shown interest in acquiring Deutsche Bank’s India retail business. The deal is expected to be an all-cash transaction, with Federal Bank said to be a leading contender.
RBL Bank, which was recently acquired by Emirates, may also participate in the bidding process, with the sale process expected to conclude by January 2026.