CBMM
CBMM
The case starts with Flade, the Regional Head of Private Banking Sales at Deutsche
Bank (DB), must decide whether to include a newauto-callable structured retail Definition and Key Characteristics of SRPs:
product (SRP)in the bank's sales recommendations.
● Key characteristics include the use of derivatives to structure payoffs, offering
Slide 2: Introduction to Deutsche Bank and SRPs potential for capital protection, enhanced returns, or both. They are versatile,
catering to different risk appetites and investment objectives.
Overview of Deutsche Bank (DB):
Growth of SRPs Globally and in Germany:
● Deutsche Bank is Germany's largest financial institution and one of the largest
globally. ● Deutsche Bankis a major player in the SRP market, holding a10% market
● Founded in 1870, it operates in over 70 countries with a workforce of more than share in Europeand22.2% in Germany.
100,000 employees. ● In Germany, SRPs have become particularly popular due to the country'slow
● DB offers a wide range of services, including commercial, investment, private, interest rate environmentand investors' preference for capital protection.
and retail banking, as well as wealth and asset management.
Role of Derivatives in Structuring SRPs:
Role of Structured Retail Products (SRPs) in DB’s Portfolio:
● Derivatives, such as options and futures, are integral to structuring SRPs.
● Structured Retail Products are financial instruments designed to offer customized ● Theyallow for the creation of customized payoffsthat can range from simple
risk-return profiles, tailored to meet the specific needs of investors. capital protection to complex yield enhancement strategies.
● DB is a significant issuer of SRPs in Europe, leveraging these products to ● Theflexibilityandinnovationin using derivatives make SRPs a powerful tool
provide innovative investment solutions and maintain its competitive edge in the for meeting diverse investor needs.
market.
● SRPs are crucial because they offer investors tailored opportunities that balance
risk and return. These products often usederivativesto create unique payoffs
based on the performance of underlying assets, such as equity indices,
commodities, or interest rates.
● This customization makes SRPs attractive to both risk-averse and risk-seeking
investors, thereby playing a significant role in modern financial markets.