Deutsche Bank has partnered with its asset management arm, DWS, to strengthen its position in the fast-growing private credit market. The collaboration gives DWS priority access to asset-based finance, direct lending, and other private credit opportunities sourced by Deutsche Bank.
Private credit funds, which operate outside traditional banking, have gained significant traction, with firms like Apollo, KKR, and Blackstone dominating the space. To compete, major banks, including Citi, have been forming partnerships with private credit managers. These alliances allow banks to leverage their client networks while reducing capital exposure, aligning with a broader industry shift toward alternative assets. As part of this strategy, Patrick Connors, Deutsche Bank’s former European head of global credit financing, will join DWS as the global head of private credit. DWS currently manages €110 billion in alternative investments, part of its €1 trillion total assets under management.
Despite the sector’s rapid growth, regulators have raised concerns about lending shifting to the shadow banking system, where oversight is less strict. With private credit funds playing an increasingly significant role in corporate financing, authorities are monitoring potential risks associated with reduced regulatory scrutiny.
This partnership positions Deutsche Bank and DWS to capitalize on the rising demand for private credit investments. By combining Deutsche Bank’s origination capabilities with DWS’s asset management expertise, the firms aim to navigate market opportunities while addressing regulatory challenges.
