Deutsche Bank Reportedly Ready To Sell Off Asset Management Units As Euro Crisis Drags On

Friday, January 13, 2012 09:50
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Deutsche Bank Reportedly Ready To Sell Off Asset Management Units As Euro Crisis Drags On

Tags: asset management

Germany's biggest bank is now willing to sell roughly $2 billion in asset management businesses -- including the DWS fund family in the United States -- in order to raise cash.

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Deutsche Bank is currently reviewing bids to unload its sprawling asset management operation, keeping only the non-U.S. DWS operation.

 

About $500 billion in AUM and $525 million in annual profit is on the block here, with maybe 25% of that AUM coming from the American DWS side of the business.

 

Deutsche needs to streamline its operation to meet stricter European capital rules. Right now, the bank is about $5 billion behind where it needs to be to keep the regulators happy.

 

For advisors who use DWS funds, this could be a critical period to watch manager risk as well as potential conflicts of interest that emerge depending on the buyer. 

 

A private equity sale wouldn't be so bad, since they'd only be interested in maintaining the existing profit stream.

 

But if DWS gets sold to another bank or even a brokerage firm, it might be less attractive for some advisors to maintain a relationship with these funds.

 

 

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