Deutsche Bank has laid out plans to reduce its U.S. balance sheet as the U.S. Federal Reserve adopts new rules to shield the country’s taxpayers from costly bailouts. The German bank is expected to reduce its $400 billion balance sheet in the U.S. to around $300 billion in part by reassigning operations such as its Mexican arm and its Frankfurt and Tokyo-based repo businesses that are currently part of its U.S. business elsewhere. The bank will also reduce a sizeable chunk of its repo business in the U.S. after discovering that some of its clients were not making use of its other offerings. The bank may reassign U.S.-based operations to Europe or Asia to reduce assets in its U.S. division. The bank said the balance sheet adjustment should not be seen as a pullback from the bank’s U.S. franchise, where the lender is focused on growing its asset and wealth management business as well as battling to regain ground lost to U.S. rivals in its flagship fixed income arm.
