(Bloomberg) -- Deutsche Bank AG is launching a new investment manager targeting private credit opportunities on behalf of institutional clients, high net worth individuals and retail investors.
DB Investment Partners (DBIP) will invest in corporate, real estate, asset-based, infrastructure and renewable finance lending opportunities, among other private debt strategies, according to a statement from the bank on Tuesday.
Other banks have bet on private credit this year, including JPMorgan Chase & Co., which invests from its balance sheet, and Societe Generale SA, which has plans to raise a €10 billion ($10.7 billion) fund alongside Brookfield Asset Management Ltd. These, along with other new entrants such as Fidelity International and Ninety One PLC, have seen the industry swell in size to $1.5 trillion.
With the new venture, Deutsche Bank is making a foray into raising outside money for private credit. Among the large global banks, Goldman Sachs Group Inc. has succeeded in having a substantial presence in private credit lending via its asset management business, and often competes to participate in billion-dollar deals.
While some banks have set aside sums to lend through their own balance sheets, regulatory constraints make it challenging. There are stiff capital charges for holding loans for buyouts and highly levered companies.
Retail Investors
In a novel move, DBIP will also take money from retail investors, a trend that is gathering steam among funds, such as Apollo and Blackstone, but has not yet fully taken hold among other banks.
The German banking giant already invests in private debt through its balance sheet, but DBIP will operate independently of that business, the statement said. The bank does expect the new investment manager to benefit from dealflow generated through Deutsche Bank’s existing lending arms.
Raheman Meghji, previously a Deutsche Bank managing director, will be chief executive officer of the new firm, while Jon Aisbitt will be chair. Aisbitt has formerly acted as the chairman for Pension Insurance Corp. Group Ltd. and Man Group PLC.
Bloomberg News reported last June that Deutsche Bank planned to raise around €2 billion for a range of different credit strategies.
©2023 Bloomberg L.P.
