Deutsche Bank AG’s asset management business is considering transformational takeovers with the confidence that it has a green light from CEO Christian Sewing to pursue major acquisitions.

Asoka Woehrmann, head of asset manager DWS Group, is scanning for large-scale deals as well as bolt-on acquisitions, people with knowledge of the matter said. He’s confident that Sewing, who had previously been reluctant to see Deutsche Bank’s stake diluted, would allow DWS to sell fresh equity to finance the right deal, the people said, asking not to be identified because the information is private.

Deutsche Bank, halfway through an ambitious cost-cutting plan, is turning to growth after volatile global markets during the pandemic boosted its investment bank. The boom in trading is reassuring Sewing that he will hit the 2022 profitability target, on which he has staked his credibility, allowing him to relax the tight control he has sought to exercise over the bank.

DWS and Deutsche Bank declined to comment.

Sewing has said he wants DWS to become a top 10 global asset manager as scale becomes an ever more important success factor in an industry faced by growing margin pressures. While DWS — with about 790 billion euros of assets under management — is large by European standards, it falls far short of global passive providers such as BlackRock Inc. and Vanguard. Deutsche Bank ranks about 17th globally, according to ADV Ratings and a deal could help it catch up with rivals such as France’s Amundi.

Woehrmann is now screening the market for large-scale purchases after a previous attempt to merge with UBS’s asset management unit fell apart two years ago. The two banks couldn’t reach an agreement on who would retain majority control of the combined entity, people with knowledge of the matter said at the time.

Woehrmann later described M&A as a “personal ambition,” though Deutsche Bank’s large restructuring put those plans on hold. Both he and Sewing recently had their contracts extended by the bank.

There aren’t any talks yet between DWS and other asset managers, the people said. The asset management unit of Credit Suisse could be a potential target for DWS if the bank was interested in selling, they said. Credit Suisse recently said it’s considering options for the unit and appointed Ulrich Koerner, who led UBS’s asset management at time of the talks with DWS, as its new head. A sale could potentially help the bank replenish capital buffers from the expected financial hit from the Greensill and Archegos implosions.

Asset managers of banks are in the spotlight as the industry consolidates globally. Wells Fargo recently sold its fund business while Societe Generale SA is in final talks to dispose of its ETF business Lyxor. Bank of Montreal is running an auction for parts of its asset-management arm.

Scale is getting more important for firms due to competition from low-cost providers such as Vanguard and Blackrock. Some asset managers have also bought alternative asset managers to diversify and boost returns. Overall, deal volumes are at the highest since the financial crisis with asset managers looking for transformational deals including firms such as State Street. Morgan Stanley bought Eaton Vance and Legg Mason was acquired by Franklin Templeton.

DWS’s unusual legal structure makes it possible for Deutsche Bank to reduce its stake to as low as 40% — equivalent to half its stake — without the need to de-consolidate the asset manager from its accounts.