Sale of the IT services unit is seen as a key step forward for the German banking group’s strategic transformation
Deutsche Bank agrees to sell Postbank Systems to Tata Consultancy Services .(Credit: Deutsche Bank AG)
Deutsche Bank has agreed to sell its IT services unit Postbank Systems to India-based Tata Consultancy Services (TCS).
The German banking group said that the transaction is a major step towards its strategic transformation and is in line with its previously stated financial plans.
According to Deutsche Bank, the sale will accelerate expected transformation impacts of around €120m, as part of a strategy announcement made in July 2019.
Postbank Systems has been providing project management, application management, and infrastructure support services to Bausparkasse, a brand of Deutsche Bank’s retail banking unit Postbank. The company also caters to the IT needs of the subsidiaries of the German banking group.
The Germany-based IT services provider’s workforce of nearly 1,500 people will become part of TCS, post-acquisition.
Deutsche Bank chief technology, data and innovation officer Bernd Leukert said: “As part of our move to one technology organisation, we are consolidating the IT platform for our retail banking brand Postbank into the Deutsche Bank platform.
“TCS is already a trusted IT services partner for Deutsche Bank and this strengthens our relationship further. We are confident that TCS is the ideal owner for Postbank Systems.
“With this transaction, we have agreed a structure that serves all parties’ interests.”
Deutsche Bank said that the deal will not impact its plans and will not disturb its schedule for modernising its IT platform. Rather, it will help in further deepening the existing relationship with TCS, said the German group.
For TCS, the acquisition of Postbank Systems will add further to its scale in Germany, while bolstering its growth outlook.
TCS chief operating officer and executive director N G Subramaniam said: “We are pleased to deepen our long-standing partnership with Deutsche Bank, continue to help accelerate their digital transformation, and to acquire market specific capabilities in the banking domain.”
The deal is subject to the finalisation of further agreements by Deutsche Bank and TCS, which is expected to be done by the year-end. Its closing will be subject to receipt of customary regulatory and governmental approvals.
Last month, Deutsche Bank reported a third quarter net profit of €309m compared to a net loss of €832m in the third quarter of 2019.