Deutsche Bank disclosed in its annual report that its private credit portfolio climbed by about 6% to almost 26 billion euros in 2025, up from 24.5 billion euros a year earlier. The Frankfurt-based lender framed the growth while emphasizing risk factors facing the broader private credit market.
In the report, Deutsche Bank pointed to a recent spate of failures among certain U.S. sub-prime lenders as a catalyst for increased investor scrutiny. "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," the bank said.
Deutsche Bank said it follows "conservative underwriting standards" for its private credit holdings and that it was not subject to significant direct risks. The bank cautioned, however, that "the bank could face potential indirect credit risks through interconnected portfolios and counterparties," acknowledging pathways through which stress in the sector could affect its balance sheet.
Regulators have highlighted banks' exposure to private credit as a concern in part because disclosure in the sector is limited, the report noted. The private credit market itself has been shadowed by worries about weakening credit quality and by concentrated exposure to the software sector - an area the report describes as vulnerable to disruption from advances in artificial intelligence.
The disclosure accompanies a wider industry debate about transparency and risk assessment in a roughly $2 trillion private credit market. Deutsche Bank's update reiterated the institution's internal risk approach while also reflecting the broader unease among investors and supervisors about underwriting standards and potential fraud risk in private lending.
For reference, the bank included the exchange rate used in its reporting: $1 = 0.8653 euros.
Context and implications
The bank's annual report links its portfolio growth to broader market dynamics without asserting direct material exposures. It underscores the dual message that, while Deutsche Bank applies conservative standards, interconnectedness across portfolios and counterparties leaves room for indirect credit transmission if stresses in private credit escalate.