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(Bloomberg) -- Deutsche Bank AG is set to acquire a portfolio of soured loans worth around $800 million from the United Arab Emirates’s largest lender in a rare large deal in the Gulf for distressed debt, people familiar with the matter said.
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The German lender outbid other international candidates including US hedge funds for First Abu Dhabi Bank PJSC’s non-performing loan portfolio, according to the people, who asked not to be named because the information isn’t public. It wasn’t immediately clear how much Deutsche will pay for the loan book.
Deutsche Bank declined to comment, while First Abu Dhabi Bank didn’t immediately respond.
Banks often sell off problem loans to free up resources and shore up their balance sheets. First Abu Dhabi Bank is the second lender from the emirate to offload a large book of non-performing loans in recent years. Rival Abu Dhabi Commercial Bank PJSC sold $1.1 billion of bad debt to Davidson Kempner in 2023, in what was considered a landmark deal that paved the way for similar transactions in the region.
Deutsche has been expanding its Middle Eastern franchise in recent years, making the region a vital cog in its emerging markets strategy. It’s been hiring across business lines, and appointed a veteran banker as its new regional chief executive last year.
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