Deutsche Bank said last night it was in advanced talks to take a stake in rival Deutsche Postbank.
Should Deutsche seize one of the final chances to boost its retail clout in Germany, it would be the second big bank deal in Europe's biggest economy this month after Commerzbank agreed to buy Dresdner Bank.
Deutsche Bank Chief Executive Josef Ackerman signalled earlier on in the day that he would buy into Postbank if the price was right.
Mr Ackermann labelled Postbank - with almost 15 million customers and a market value of more than $10 billion - as a good fit for Germany's biggest lender.
Sources with direct knowledge of the matter later told Reuters a deal had already been broadly agreed. Deutsche then confirmed it was in advanced talks with Postbank's owner, Deutsche Post.
Post has called a meeting of its supervisory board tomorrow to decide on selling part of its 50 per cent plus one share holding, the sources said.
If Deutsche Bank keeps its stake below 30 percent, it would not have to bid for the rest of Postbank's shares but would be in pole position to win control of the group later.
The
Bonner-Generalanzeigernewspaper reported that Deutsche Bank plans to buy just under 30 per cent of Postbank with a right of first refusal to buy the remaining Post-owned shares.
Post declined to comment.
Investor enthusiasm about a deal had sent Postbank's stock climbing as much as 5 per cent yesterday. Deutsche Post nudged up about 1 per cent while Deutsche Bank fell.
"It is great for Postbank and for Post too that they will finally be able to get rid of the bank either entirely or in parts," said one stock trader.
Last week, Commerzbank unveiled a $14.5 billion takeover of Dresdner Bank, beefing up Germany's second-biggest lender and throwing down the gauntlet to Deutsche Bank.
Ackermann had been considering how he could strike back. His investment bank, which built its name on Wall Street and London, has long wanted to bolster its retail business.