Germany's Deutsche Bank is preparing to shut down its retail and wealth management business in India. Two of the country's largest private banks, Kotak Mahindra Bank and Federal Bank, are in the race to acquire it. This is the second time in eight years that Deutsche Bank is considering selling its business in India. A report by ET, citing sources, said that both the Indian banks have evaluated Deutsche Bank's portfolio.
Currently, the price of this deal is being negotiated. The portfolio includes personal loans and some mortgages, which Deutsche Bank wants to sell. However, it is not clear how much personal loans and mortgages account for in this portfolio. The bank's wealth management business has around ₹25,000 crore of assets under management. In the financial year ending March 2025, the bank's retail business generated a total revenue of ₹2,455 crore, up 4% from the previous year's revenue of ₹2,362 crore.
What will benefit Indian banks?
According to the latest data, Deutsche Bank's retail banking assets totaled ₹25,038 crore as of the end of March 2025. Deutsche Bank CEO Christian Siewing has launched a restructuring plan to make the bank more profitable globally. As part of this plan, Deutsche Bank intends to completely exit its retail business in India. Spokespersons for Kotak Mahindra Bank and Federal Bank did not respond to emailed queries. A Deutsche Bank spokesperson also declined to comment on the matter.
A source said that discussions are on, but valuations will also have to be looked at. Both Kotak and Federal Bank are interested in expanding their business by acquiring portfolios, and this is one such opportunity. It will also give him a stake in Deutsche Bank's wealth management business, which will align with both banks' ambitions in the sector and their retail businesses.
Challenge of foreign banks
Foreign banks in India face stiff competition from large domestic banks. Their costs are high and they are unable to compete strongly on pricing. In 2022, Citibank sold its credit card and retail business to Axis Bank for over $1 billion. In the same year, Kotak Mahindra Bank acquired a personal loan portfolio worth ₹3,330 crore from Standard Chartered.
Deutsche Bank itself sold its credit card business to IndusInd Bank in 2011. Deutsche Bank's wealth management business in India also includes debt investments linked to the bank's corporate business. This includes the accounts of some wealthy individuals, which can be very profitable for Kotak Mahindra and Federal. Germany's largest bank by assets had earlier planned to sell its retail and wealth management in India in 2017, but later withdrew the plans.
business reasons
India is the only market outside Europe where Deutsche Bank has a retail business. The bank has 17 branches in India, and most of them will be closed. Another source familiar with the matter said the company is serious this time. The bank's profit in India rose 55% to ₹3,070 crore in the financial year ended March 2025, from ₹1,977 crore in the previous year. The German bank has built its business primarily focusing on investment banking, corporate and transaction banking, treasury and derivatives, and private wealth.
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