BNP Paribas eyes Deutsche Bank's equity derivatives book: report

August 30, 2019 09:25
BNP Paribas is said to be hopeful that it can bear rival bidders and land a deal for Deutsche Bank’s equity derivatives portfolio. Photo: Bloomberg

BNP Paribas plans to bid for Deutsche Bank’s equity derivatives book and is hopeful it can beat off rival bidders to secure a deal in the next few weeks, Reuters reports, citing sources familiar with the matter.

Deutsche Bank plans to auction its equity derivatives portfolio next month after having received significant expressions of interest from banks, private-equity firms and hedge funds, according to the report.

The German bank is selling the portfolio as part of a restructuring that will see it exit equities trading and other unwanted businesses and shed 18,000 staff globally.

BNP is already close to taking control of Deutsche Bank’s prime brokerage business, which serves hedge fund clients. A preliminary deal was struck in July which is expected to be formalized early next month.

Any equity derivatives deal would be separate from that transaction, sources told Reuters.

BNP expressed its interest in Deutsche Bank’s equity derivatives business earlier this year but the German lender decided against entering into exclusive talks having also received interest from other parties.

Deutsche Bank plans to close the prime brokerage deal in the first half of September and to begin the auction of its equity derivatives book shortly afterwards, according to Reuters sources.

The deals are expected to take months to complete as buyers take over individual client accounts.

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