MC EXCLUSIVE Deutsche Bank’s India retail sale faces valuation hurdles due to wealth biz run down

Deutsche Bank’s wealth business, which was valued at $4 billion when the sale process was initiated, may have seen a significant decline in its AUM, sources said.

What started out as a sale of its entire retail business in India for Deutsche Bank is facing hurdles, primarily owing to an apparent decline in the size of its wealth management business. Highly placed sources aware of recent developments say the wealth business of Deutsche Bank, which had assets under management (AUM) of approximately $4 billion when the sale process was formally initiated in September this year, may have seen a significant decline in its AUM.

Consequently, the sale of Deutsche Bank’s India retail franchise may now involve divestment of loan assets, deposits, and branch outlets. The bank is said to have a loan book of about Rs 12,000 crore and deposits of Rs 20,000 crore, with about 17 branches. The valuations sought, according to bankers involved in the process, is about Rs 3,000 – 5,000 crore.

“With the German headquarters having decided to exit the retail market in India, the sale will fructify irrespective of how the valuations pan out or what has happened in the wealth business,” said a person cited above

Exit of senior leadership executives

Senior business leaders heading India’s wealth business, including the outfit’s chief executive and his immediate deputies, are said to have moved out of the unit after the sale was announced.

It is learnt that the top management of the entity may have joined a leading standalone wealth platform. Critical clients and portfolios managed by them are said to have migrated from Deutsche Bank when the leadership team exited the company.

While the exact value could not be ascertained, sources indicate that the outstanding AUM of the wealth business may have declined to about a billion dollars from around $4 billion when the sale process started. That is a decline from about Rs 32,000 crore (at Rs 85 to a dollar exchange rate) to Rs 9,000 crore at present.

“It is very natural to see such a senior leadership attrition in case of the sale of a business. It has happened in the past when the Citi–Axis Bank deal was taking place. Wealth management tends to be personalised and is relationship driven. It is likely that the business may have also migrated along with the leadership executives,” said a banker aware of the ongoing sale talks.

It is learnt that the wealth business also has a loan against shares (LAS) unit, which may not find fit in a standalone banking outfit .

“As a matter of policy, we do not comment on rumours or market speculation,” a spokesperson of Deutsche Bank in India said in response to Moneycontrol queries.  “Deutsche Bank Group is firmly committed to India, where we maintain a substantial and diverse presence across business divisions and critical functions, underpinned by a long-standing and deep-rooted history."

Interested bidders

Reports suggest that Kotak Mahindra Bank and Federal Bank have shown interest in the deal. Expected to be an all-cash deal, Federal Bank is said to be the frontrunner for Deutsche’s India retail business. However, RBL Bank, recently acquired by Emirates,  too, may join the bidding process, which is expected to formally conclude in January 2026.

“Earlier Emirates had shown interest in acquiring the retail business of Deutsche Bank. Now with the deal going through, RBL Bank may make a pitch for the business, not Emirates,” said a person aware of the matter.