Deutsche Pfandbriefbank Completes $2 Billion Office Real Estate Risk Transfer with Oaktree

GARCHING, Germany — December 22, 2025 — Deutsche Pfandbriefbank (pbb) has completed a synthetic significant risk transfer (SRT) transaction with Oaktree Capital Management on a $2 billion portfolio of performing U.S. office real estate loans, the bank announced.

Oaktree Provides $320 Million Mezzanine Protection

Under the agreement, Oaktree will provide credit protection on a mezzanine tranche valued at approximately $320 million through an interest-bearing, cash-collateralized credit-linked note issued by pbb. The synthetic structure allows pbb to retain senior exposure while transferring 16% of the portfolio’s credit risk to Oaktree.

Andreas Wuermeling, Head of Originate & Cooperate at pbb, said the transaction represents a milestone in the bank’s withdrawal from the U.S. market. “It enables us to rapidly implement the economic hedging of 16% of the risk associated with the reference loan portfolio,” Wuermeling said in a statement.

Advisors and Arrangers

Alvarez & Marsal Financial Services acted as lead transaction advisor to pbb. Deutsche Finance International acted as sole arranger and placement agent. Legal counsel was provided by A&O Shearman for pbb and Mayer Brown for Oaktree.

Oaktree’s Role in the Transaction

Manish Desai, Managing Director and real estate sector lead in North America for Oaktree’s Global Opportunities strategy, said the transaction highlights Oaktree’s ability to design and fund customized financings in the commercial real estate sector. Oaktree manages $218 billion in assets globally as of September 2025.

Transaction Overview

The synthetic structure allows pbb to maintain the loans on its balance sheet while transferring part of the credit risk, providing flexibility in managing capital requirements. The underlying portfolio primarily comprises office assets in the United States.

Sources: Deutsche Pfandbriefbank press release