Deutsche Bank highlights private credit risks as portfolio grows

FRANKFURT, March 12 (Reuters) - ‌Deutsche Bank ​said ​on Thursday that its private credit portfolio grew around 6% to ‌nearly 26 billion euros ($30.05 billion) in 2025 ⁠as it highlighted risks to the headline-grabbing sector.

The ‌disclosure, made in the ‌bank's annual report, comes as investor worries mount for the $2 trillion industry over ​deteriorating credit quality.

"Failures of a select number of sub-prime lenders in the U.S. ⁠increased investor focus on risks associated with private credit and ​raised wider concerns around underwriting standards and fraud risk," Deutsche Bank said.

Deutsche ​said it applies "conservative underwriting ‌standards" to its portfolio, which rose from 24.5 billion euros in ⁠2024.

Germany's largest lender said it was not exposed to significant risks but "the bank could face ⁠potential indirect credit risks through interconnected portfolios and counterparties".

Regulators ​have flagged concerns about banks' exposure to private credit in part because disclosures are scant.

Private credit has ‌been marred by concerns about deteriorating credit quality and exposure to ‌the software sector - an industry seen as ⁠ripe for disruption ‌by advances in ​artificial intelligence.

($1 = 0.8653 euros)

(Reporting by Tom Sims and Matthias InverardiEditing by Tomasz ‌Janowski)

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