RAM Ratings upgrades Deutsche Malaysia to AAA

Published on 03 Jul 2024.

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RAM Ratings has upgraded Deutsche Bank (Malaysia) Berhad’s (Deutsche Malaysia or the Bank) long-term financial institution rating (FIR) to AAA from AA1, revising the rating outlook from positive to stable. 

The upgrade is based on the improved credit profile of the Bank’s parent, Deutsche Bank AG (the Group), following the effective execution of its business transformation plan which we believe has stabilised and strengthened earnings. The Group continued to narrow the profitability gap with peers through commendable revenue growth and improving cost efficiency, while preserving solid capital and liquidity profiles. Deutsche Malaysia’s AAA/P1 FIR incorporates an uplift benefit from the credit strength of its parent and accordingly the Group’s ability to provide financial support to the Bank when required. 

The ratings are further backed by the Bank’s entrenched position in Malaysia’s wholesale banking space – particularly fixed income and currencies – its solid liquidity profile, sound risk management and robust capitalisation which provides ample headroom against earnings volatility. 

In FY Dec 2023, Deutsche Malaysia’s pre-tax profit improved slightly to RM279.3 mil (FY Dec 2022: RM270.0 mil). While the better performance of its cash management and securities services business drove earnings higher, the improvement was partly offset by lower foreign exchange earnings, given a slower inflow of foreign funds and higher operating expenses. The Bank’s return on risk-weighted assets slid marginally to 3.5% (FY Dec 2022: 3.6%) on account of a larger risk-weighted asset base as derivative contracts increased. 

In view of its heavy involvement in trading and market-making activities, Deutsche Malaysia’s profitability is highly sensitive to market sentiment. The Bank’s common equity tier-1 capital ratio of 19.9% as at end-December 2023 serves as a sturdy loss absorption buffer against potential fluctuations in earnings. 


Analytical contacts
Jeremy Noel Paul 
(603) 3385 2556

Sophia Lee
(603) 3385 2619

Media contact
Sakinah Arifin
(603) 3385 2500


The credit rating is not a recommendation to purchase, sell or hold a security, inasmuch as it does not comment on the security’s market price or its suitability for a particular investor, nor does it involve any audit by RAM Ratings. The credit rating also does not reflect the legality and enforceability of financial obligations.

RAM Ratings receives compensation for its rating services, normally paid by the issuers of such securities or the rated entity, and sometimes third parties participating in marketing the securities, insurers, guarantors, other obligors, underwriters, etc. The receipt of this compensation has no influence on RAM Ratings’ credit opinions or other analytical processes. In all instances, RAM Ratings is committed to preserving the objectivity, integrity and independence of its ratings. Rating fees are communicated to clients prior to the issuance of rating opinions. While RAM Ratings reserves the right to disseminate the ratings, it receives no payment for doing so, except for subscriptions to its publications.

Similarly, the disclaimers above also apply to RAM Ratings’ credit-related analyses and commentaries, where relevant.

Published by RAM Rating Services Berhad
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Ratings on Deutsche Bank (Malaysia) Berhad