Allianz & Dresden Bank

Topics: Dresdner Bank, Investment banks, Kleinwort Benson Pages: 2 (703 words) Published: June 24, 2013
GIVEN the disaster a year ago, when highly paid traders at Dresdner Kleinwort Wasserstein turned in a measly €128m ($161m) profit for the second quarter, their performance this year, at over €400m per quarter, looks quite respectable. But compared with the banks that used to be Dresdner Bank's peers, UBS and Deutsche Bank for example, the result reads like a condemnation of the Allianz group's trophy investment bank. Allianz bought Dresdner Bank in 2001—a deal designed to marry banking, investment banking and insurance. But Dresdner was not much of a catch. It had €35.5 billion of problem loans. It had also just spent €1.6 billion on Wasserstein Perella, a corporate-finance boutique—probably one of the most misguided splurges on Wall Street talent ever. The Wasserstein culture clashed horribly not only with Dresdner, but with the ethos of Kleinwort Benson, a British merchant bank, which Dresdner had bought in 1995. Allianz has never managed to get to grips with its new subsidiary. Only now, after Dresdner Kleinwort has purged itself of the Wasserstein name, and the bad loans have shrunk to €2.3 billion, does Dresdner Bank seem to be moving, if only modestly, in the right direction. Risk and cost reduction are its main achievements, but that of course makes earning big rewards, and attracting the right staff, all the more difficult. Herbert Walter, Dresdner Bank's boss, has not added much magic: he came from Deutsche Bank as a retail specialist. Can a triumvirate of former Goldman Sachs rainmakers make a difference? The man running finance at Allianz, Stefan Jentzsch, was brought in from Goldman to run the investment bank in November by his friend Paul Achleitner—who used to be head of Goldman in Germany. Mr Jentzsch hired two former colleagues, Jens-Peter Neumann and Alberto Piedra, to head markets and corporate finance. Dresdner Kleinwort has only around €2.4 billion of capital to play with. Allianz's asset-management arm and its private-equity business, Allianz...
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