Ratings agency Fitch has affirmed Deutsche Asset Management Germany (Deutsche AM) with “highest ratings” with a stable outlook.
The reasoning given for the agency’s decision is “driven by the continued strength of the company’s investment and operational platform”.
The firm’s stable outlook indicates that the rating is unlikely to change over a one-to-two year period. Both the affirmation of “highest ratings” and the stable outlook reflect Fitch’s view that Deutsche AM has ample financial resources and that recent staff turnover is neither excessive nor a material risk to the business.
However, Fitch placed Deutsche Bank, the asset manager’s parent bank, on “ratings watch negative” on November 3 this year, citing a sluggish business environment that will make it harder for the bank to improve revenue generation and build capital.
Notwithstanding the parent bank’s financial condition, Fitch views Deutsche AM’s financial resources as strong.
Despite Deutsche AM’s series of senior-level departures this year, Fitch said the departures have been mitigated by Deutsche AM’s “matrix organisation” structure.
Asset managers are rated ‘Good Standards’, ‘High Standards’ and ‘Highest Standards’ by Fitch relative to the standards applied by institutional investors in international markets. Therefore it seems that despite Deutsche Bank’s troubles, its asset management arm is in good health.
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