MUMBAI: Deutsche Bank, the German multinational financial services company, announced a substantial capital infusion of Rs5,113 crore into its India operations.
The investment represents the largest capital allocation to India in recent years and is poised to facilitate the bank’s expansion across various business lines, including corporate banking, investment banking, and private banking.
The strategic decision underscores Deutsche Bank’s long-term commitment to the Indian market, where it has maintained a presence for the past 45 years.
As of March 31, 2024, Deutsche Bank’s balance sheet in India stood at an impressive Rs1.45 lakh crore, positioning it as one of the largest foreign banks in the country, with a network of 17 branches.
Bank’s robust strategy
The recent capital infusion marks a notable 33 per cent increase in its capital buffer compared to 2023 levels, raising the bank’s total regulatory capital in its Indian branches to nearly Rs30,000 crore. This figure reflects a threefold growth in the last decade, evidencing the bank’s robust strategy in a rapidly evolving financial landscape.
The significance of this capital allocation is further emphasized by comments from Deutsche Bank’s management.
Muehlen, a member of the lender’s management board, identified India as a critical growth market. He articulated that the increased capital allocation is intended to support the bank’s expansion efforts and strengthen its presence in this dynamic economy.
Kaushik Shaparia, the bank’s country chief executive officer, described the infusion as a strong validation of confidence in Deutsche Bank’s business model and the potential it sees in India.
Moreover, the bank reaffirmed its commitment to contributing to India’s growth trajectory, particularly in vital areas such as digital transformation, sustainable finance, technology, and infrastructure development. This focus aligns with India’s broader economic goals and highlights the role of foreign investment in driving domestic growth.
It is noteworthy that Deutsche Bank had previously made significant capital infusions into its Indian operations, contributing Rs2,700 crore in 2020 and Rs3,800 crore in 2019. Despite a slight decline in profit after tax to Rs1,467 crore in FY23, the bank’s capital adequacy ratio remained healthy at 15.41 percent as of March 31, 2023.
