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28 November 2019

Deutsche Bank sells $50 billion book of assets to Goldman

Deutsche Bank’s balance sheet reduction is a cornerstone of Chief Executive Officer Christian Sewing’s sweeping restructuring, unveiled in July 2019.

Bloomberg/Jason Alden

Deutsche Bank sold another chunk of unwanted assets to Goldman Sachs Group as part of a radical restructuring that is seeing the German firm exit businesses where it’s been unable to compete, reported Bloomberg.

The nation’s largest lender recently sold securities with a notional value of about GBP 40 billion ($51 billion) to the US bank. The assets are tied to emerging market debt and were previously housed in Deutsche Bank’s wind-down unit.

It’s at least the second time that Goldman bought securities that Deutsche Bank has earmarked for disposal as part of its latest turnaround plan. In September 2019, the US investment bank purchased the Asian portion of a portfolio of equity derivatives that the German lender had put up for sale.

Sewing is drawing down the bank’s capital buffer to pay for the cost cuts and has promised regulators to reduce risk at the bank in return.

The Deutsche Bank chief has vowed to cut the leverage exposure—a regulatory measure of risk—in the wind-down unit to EUR 119 billion ($131 billion) at the end of the year, from EUR 177 billion at the end of September 2019. Sewing previously reached an agreement to transfer the hedge fund business to BNP Paribas and sold other portions of the equity derivatives portfolio to Barclays and Morgan Stanley.


RELATED STORIES: Deutsche Bank Barclays Morgan Stanley BNP Paribas





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