Deutsche Bank, BNP Face Reality of $168 Billion Hedge-Fund Deal
- Two banks working on deal to transfer over prime broker assets
- Deutsche Bank clients are pulling about $1 billion per day
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When Deutsche Bank AG said it was exiting the business of servicing hedge funds as part of its historic retreat, French rival BNP Paribas SA seemed poised to benefit. The reality is more complicated.
The two European banking giants are discussing how to transfer 150 billion euros ($168 billion) of balances linked to hedge funds at Deutsche Bank’s so-called prime-brokerage unit along with technology and potentially hundreds of staff, people familiar with the matter said. Yet the German lender’s clients have been pulling about $1 billion of funds per day and going elsewhere as the firms iron out the details, placing pressure on them to complete a deal soon, said the people, who requested anonymity as the talks aren’t public.