Deutsche Bank Essay ⋆ Business Essay Examples ⋆ EssayEmpire

Deutsche Bank was founded in 1870 by Adelbert Delbrück (a private banker) and Ludwig Bamberger (a politician and currency expert). In the beginning it focused on foreign trade and was involved in the development of Germany’s electrical, engineering, iron, and steel industries.

Soon after its establishment, a period of rapid expansion followed, with branches opening outside Germany. Shanghai and Yokohama in 1872 were the first branches to be established, followed by the London branch the next year. Deutsche Bank expanded in the United States, too. In the beginning, this was accomplished via partnerships, but in 1979 it established its first branch under its own name in New York. The solid base generated in Germany was a major support for the bank’s ability to finance its foreign businesses. Deutsche Bank started buying other major banks as early as 1876. In the 1890s, the bank formed alliances with banks in various locations in Germany, strengthening its presence in various industrial regions of the country.

Continuing domestic investments, Deutsche Bank merged with Disconto-Gesellschaft in 1929, the largest merger in German banking industry. In the 1930s, the bank became a tool of the Nazi state. That period was almost catastrophic for the bank. In 1947 it was divided into 10 smaller banks, which merged in 1957, reestablishing Deutsche Bank. In the 1980s and 1990s, Deutsche Bank managed to build a worldwide network of branches. It was also involved in acquisitions, and at the same time established subsidiaries around the world.

Deutsche Bank continued its worldwide expansion strategy in the new millennium. In 2001 it was listed on the New York Stock Exchange (NYSE). In Europe, it acquired Rued Blass & Cie (2002) and Russian investment bank United Financial Group (2006) in order to support its private banking business. However, it did not neglect domestic investments—it acquired Noris Bank and Berliner Bank. This move strengthened its retail business in Germany, but its investments were not limited to that—there was also expansion into the markets of China, India, and Russia.

Deutsche Bank offers its services not only to corporate and institutional customers, but also to private and business clients. Grouping the services offered, the bank can be divided into two divisions. First, the Corporate and Investment Bank Group Division deals with capital markets. It involves the origination, sales, and trading of capital markets products including debt, equity, and other securities, together with its corporate advisory, corporate lending, and transaction banking businesses. This division is further subdivided into (1) Corporate Banking and Securities, whose main services are the origination, sales, and trading of capital market products, corporate advisory and corporate financing businesses, asset finance and leasing, and commercial real estate; and (2) Global Transaction Banking, whose main services are trade finance, cash management, trust, and security.

On the other hand, the Private Clients and Asset Management Division offers investment management services to both private and institutional clients. It services private individuals and small and medium-sized business with traditional banking activities. It is further subdivided into (1) Asset and Wealth Management, which offers traditional asset management, alternative assets, real estate asset management, and mutual funds to retail clients across the globe as well as wealth management, portfolio management, tax advisory, inheritance planning and philanthropic advisory services; and (2) Private and Business Clients, which offers banking services (loans, current accounts, deposits and payment services, securities and mutual funds, and portfolio investment advisory) to private customers as well as small and medium-sized business clients in Germany and seven other countries across Europe and Asia.

The bank has a presence in 75 nations worldwide through its 1,922 branches, 986 of which are in Germany (as of 2008). More than half of its 80,253 employees work outside Germany. Its mission is to be the leading global provider of financial solutions for demanding clients, creating exceptional value for its shareholders and people. In fulfilling the above, Deutsche Bank’s strategy aims at accelerating global growth, maintaining strict cost, risk, and capital discipline. It also aims at taking advantage of synergies across complementary business lines. Future investment options will include not only organic growth, but also acquisitions of other organizations, which will contribute to the successful global presence of the bank.

Bibliography:

Deutsche Bank (WetFeet, 2008);
Deutsche Bank, www.db.com (cited March 2009);
“Finance and Economics: Snakes and Ladders; Deutsche Bank,” Economist (v.386/8568, 2008);
Christopher Kobrak, Banking on Global Markets: Deutsche Bank and the United States, 1870 to the Present (Cambridge University Press, 2008).

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