Deutsche Bank (DB) Acquires 15% Stake In Neo Technologies

DWS Group, Deutsche Bank (DE:DBKGn)'s (NYSE:DB) asset-management unit, has inked an agreement for acquiring 15% equity stake in Dubai-based Neo Technologies, with an aim to offer enhanced services to its clients. The partnership will mark a step forward by the German bank to adopt the new online technology or fintech.

Financial terms of the deal remain undisclosed.

Notably, Dubai and other cities across the Gulf region face intense competition to evolve as emerging fintech providers. Neo Technologies is a provider of technology and consulting services to businesses which are aimed providing digital asset-management services.

Per the terms, through this collaboration, DWS Group and Neo Technologies look forward to develop and expand asset-management services digitally in the Middle East and North Africa region. Notably, DWS Group has assets under management worth 692 billion Euros as of Sep 30, 2018.

"NEO Technologies enables DWS to obtain further presence in a region with high growth rates in asset management," Thorsten Michalik, co-head of DWS' global coverage group, said in a statement.

With growing usage of digital services, this partnership is expected to attract potential customers, who want to make use of such services.

Stress Test Results

In the 2018 Europe’s stress test, Deutsche Bank turned triumphant with stronger capital position as compared with the previous years. Common Equity Tier 1 (CET 1) ratio came in at 13.5% under the EBA’s ‘baseline’ scenario at the end of the stress horizon in 2020, up from 12.1% in the 2016 stress test. In the hypothetical ‘adverse’ scenario, the CET1 ratio is likely to be 8.1%, up from 7.8%.

“The stress test makes clear: Our risk profile is strong, but our profitability is not. This is exactly where our focus is now”, said James von Moltke, chief financial officer. “Despite a more severe adverse scenario than two years ago, we show greater resilience across market, credit and operational risk. We have the liquidity and capital resources to support profitable growth,” Moltke further added.

Deutsche Bank’s shares have depreciated around 16% in the past three months compared with the industry’s decline of 5.4%.

The stock currently carries a Zacks Rank #4 (Sell).

Stocks to Consider

Mizuho Financial Group, Inc. (NYSE:MFG) has been witnessing upward estimate revisions for the past 30 days. Also, the company’s shares have gained nearly 2.7% on the NYSE, in the past two years. It carries a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Sumitomo Mitsui Financial Group Inc (NYSE:SMFG) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped around 15.3% on the NYSE, over the past two years. The stock flaunts a Zacks Rank of 1, currently.

Credit Agricole (PA:CAGR) SA (OTC:CRARY) has been witnessing upward estimate revisions for the past 60 days. Further, the company’s shares have gained nearly 23.2% on the NYSE, in the past two years. Currently, it carries a Zacks Rank of 2.

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Deutsche Bank Aktiengesellschaft (DB): Free Stock Analysis Report

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Mizuho Financial Group, Inc. (MFG): Free Stock Analysis Report

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