Internationalization of Deutsche Bank

Topics: Bank, Banking, Deutsche Bank Pages: 6 (1888 words) Published: June 15, 2011
Table of Content

1.The Beginning of Deutsche Bank1
2. Reconstruction Due to First And Second World War4
3. Internationalization4
4. Becoming a Global Player 5
5.Conclusion .6


Deutsche Bank, an international universal bank, was internationally active a short time after its foundation. The bank’s early decades were a period of rapid expansion. With its growth Deutsche Bank seemed to be unstoppable. But with the beginning of the First and Second World War the vision to offer a financial services throughout the world was destroyed. Fortunately, the year of 1957 has the status of a second birthday of Deutsche Bank. From this day on, after its reconstruction, the bank becomes active in retail banking by introducing small loans. After reentering the international banking market between the 1970s mid 1980s Deutsche Bank followed a new global strategy to set up its branch network world wideby the end of the 1980s: The expansion of the retailmarket and the presence of investment banking. Due to its continous growth Deutsche Bank has become a leading global investment bank. With 80,849 employees and a presence in over 70countries, it offers financial services throughout the world.[1]

1. The Beginning Of Deutsche Bank

The Early Years
As Deutsche Bank was founded in 1870 as a specialist bank for foreign trade in Berlin, its purpose was”to transact banking business of all kinds, in particular to promote and facilitate trade relations between Germany, other European countries, and overseas markets”.[2] In the early years they offered foreign trade payment of all kinds (to grant advance payments for export and importers reimbursement credits) to the merchants. Following the opening of branches in seaside towns Bremen and Hamburg its first foreign branches were set up shortly afterwards in Shanghai a London in 1882/83. The objective of the branch in London was primarily to be a key contact for German trading companies and secondarily to establish the German currency as a recognized means of payment. This step was very important because London was at that time the most important international trading port. Therefore the London bureau became the most important foreign branch until its closure on the outbreak of the First World War in 1914.

Deutsche Bank's early decades were a period of rapid expansion. Several acquisitions e.g. of the Berliner Bankverein and Deutsche Union-Bank in 1876 resulted in Deutsche Bank’s position as the biggest bank in the German empire. In 1886 the Deutsche-Übersee Bank was founded as a subsidiary of Deutsche Bank with its headquarter in Berlin. This was a step in order to develop activities in the increasing lucratice south-american market. They tried to give up the strategy to capture the international market slowly with own branches and thought about a new way: The control of the oversea market through subsidiaries. With participations of Deutsch-Asiatische Bank in 1889 they tried to enter the Asian market again. However, due to the price decrease of silver and financial years full of losses Deutsche Bank felt the necessity to close the branches in Asia. The bank's principal activity was trade financing. It also played an outstanding role in the underwriting of bonds for the Chinese government and in the financing of railway construction in China.

The Main Focus On Fixing And Expansion
The end of the 19th century was the beginning of a new period of expansion of Deutsche Bank. Up to this point the bank concentrated in foreign trade financing, industrial financing and emissions. However, the presence of Deutsche Bank on the German market was missing. Domestic branches of its own existed only in Bremen, Hamburg and Frankfurt. Due to this fact Deutsche Bank changed their strategy. They wanted to strengthen their presence in the German market. Therefore the bank began to establish branches in Munich, Dresden, Leipzig followed by further branches in...
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