Deutsche/Dresdner merger: the fallout

Deutsche Bank’s goal in taking over its rival Dresdner was to create a European powerhouse capable of competing on a global stage with the leading US investment banks. But with Deutsche’s direction now unclear and Dresdner in disarray, the real benefactors of the merger that never was are banks such as Merrill Lynch and Lehman Brothers. With German corporates growing increasingly uneasy about relying on the leading German commercial banks, or Landesbanks under threat from the European Commission, investment banks around the globe are battling for their business. But will the new opportunities of the euro corporate market and pressure from non-German houses be tempting enough to cut the ties of relationship banking?