Deutsche Bank Prepares to Exit India’s Retail and Wealth Management Market; Kotak Mahindra, Federal Bank in the Race

Germany’s Deutsche Bank is preparing to exit its retail and wealth management business in India, marking the second time in eight years that the bank has attempted to sell its operations here. Indian private lenders Kotak Mahindra Bank and Federal Bank are reportedly in the race to acquire the portfolio.

According to sources cited by Economic Times, both Indian banks have completed preliminary valuations of Deutsche Bank’s India assets, which include personal loans and certain mortgage portfolios. While the exact composition of these assets remains undisclosed, the bank’s wealth management business manages nearly ₹25,000 crore in assets. During the fiscal year ending March 2025, the bank’s retail business generated ₹2,455 crore in revenue, a 4% increase over the previous year.

Why This Matters for Indian Banks
As of March 2025, Deutsche Bank’s retail banking assets in India totaled ₹25,038 crore. Under a global restructuring plan spearheaded by CEO Christian Sewing, Deutsche Bank aims to focus on profitability and exit non-core businesses, including India’s retail segment. Acquiring this portfolio would allow Kotak Mahindra and Federal Bank to expand their retail and wealth management operations, while gaining access to high-value clients and loans tied to corporate banking.

Challenges for Foreign Banks in India
Foreign banks face intense competition from larger local players, higher operating costs, and pricing disadvantages. For example, in 2022, Citibank sold its credit card and retail business to Axis Bank for over $1 billion, while Kotak Mahindra acquired a ₹3,330 crore personal loan portfolio from Standard Chartered the same year. Deutsche Bank had previously sold its credit card business in India to IndusInd Bank in 2011.

Strategic Shift
India is currently the only non-European market where Deutsche Bank operates retail banking. The bank has 17 branches, most of which are expected to close following the sale. Despite this, the India business posted a 55% profit increase in FY2025, rising to ₹3,070 crore from ₹1,977 crore in the previous year. Deutsche Bank plans to concentrate on investment banking, corporate and transaction banking, treasury, derivatives, and private wealth management in India going forward.

With negotiations underway, the deal could significantly reshape the retail and wealth management landscape in India, offering growth opportunities for local banks while marking the retreat of a major foreign player from the Indian consumer banking segment.