FRANKFURT/LONDON (Reuters) – Deutsche Bank’s planned listing of its asset management arm is unlikely before the first half of next year and could be later, as it wants more time to refine and sell the business’s strategy to potential investors, people close to the matter said.
Germany’s largest lender announced plans to list the unit, including its main DWS retail asset management brand, in March as part of a broader restructuring aimed at reviving the bank’s fortunes following costly law suits and trading scandals.
While it said at the time the share sale would take place at some point over the next two years, investors expected it the bank to move quickly to take advantage of buoyant equity markets and seal a deal that could raise 2 billion euros ($2.3 billion).
But its so-called “equity story” for selling the business to investors is far from ready, and Deutsche is desperate to avoid another U-turn after it put retail business Postbank up for sale, only to decide later to keep it, the sources said.
Some investors have also indicated they would prefer a stronger focus at Deutsche’s asset management arm on so-called passive investments or exchange traded funds (ETFs), whereas its main business is currently with actively managed funds.
“The IPO story is not ready yet,” one of the people said, adding that in his view the unit needed to invest in its ETF business to keep up with competitors.
Deutsche (DBKGn.DE), which will report second-quarter earnings on Thursday, declined to comment.
Chief Executive John Cryan conceded in May it would take time to realize the benefits of the lender’s latest efforts to “plant and sow” – or breathe new life into the Deutsche brand.
Deutsche Asset Management currently has 723 billion euros invested worldwide, of which 540 billion are actively managed, 103 billion in ETFs and the rest in alternatives such as real estate.
Concern around the scale of Deutsche’s ETF offering comes as market leaders BlackRock (BLK.N) and…