FRANKFURT (Reuters) - A plan by Qatar's sovereign wealth fund to make a significant investment in Deutsche Bank has stalled, according to two people with knowledge of the matter.
The Qatar Investment Authority (QIA) approached financial regulators months ago to seek approval to buy a big stake in Germany's largest lender, the people said. Qatar's royal family already holds a combined 6.1 percent stake in Deutsche Bank.
But Qatari officials haven't yet provided the necessary documentation, which could derail the QIA's investment plans, they said. It was unclear whether the fund had lost interest or whether it was simply taking its time.
The QIA initially expressed an interest taking a stake well before Deutsche Bank announced on March 17 that it was in talks to merge with German rival Commerzbank. The issue is sensitive because the European Central Bank (ECB) may ask Deutsche to raise fresh funds to approve any deal.
QIA, Deutsche Bank and Commerzbank declined to comment.
Rumours of the investment have been reported by various media outlets for months.
Because of the Qatari royal family's existing stake in Deutsche Bank, an investment by QIA would trigger a standard background check by regulators on the shareholders to determine whether they were acting in concert to exert greater influence on the bank.
The royal family's stake is already among the largest of any shareholder. Other major shareholders include the U.S. investors BlackRock and Cerberus, and Chinese conglomerate HNA.
The royal family has lost money on its initial investment but the small Gulf nation considers itself a long-term strategic investor in Deutsche Bank.
Qatar is home to a financial centre, which the family considers an important pillar of the economy. It also considers Germany an ally as it faces a blockade by its neighbours.
Some major investors have been sceptical about a possible merger between Deutsche Bank and Commerzbank, questioning the logic and also the timing of a deal.
Deutsche Bank has said little or no capital may be needed for a deal.
But regulators have been worried about the tie-up amid doubts that a merger would strengthen Deutsche's sprawling global investment bank.
Deutsche has said it has already taken steps to shore up the investment bank, and a spokesman said on Friday there was "no basis" for the assumption that the ECB would ask it to raise fresh funds.
German government officials, led by Finance Minister Olaf Scholz, have pushed for the merger to create a national banking champion and end questions over the banks' future.
A preliminary decision on whether the banks plan to go forward with a merger is expected within days.
(Reporting by Hans Seidenstucker, John O'Donnell and Tom Sims; Additional reporting by Saeed Azhar and Davide Barbuscia in Dubai; Editing by Ludwig Burger and Mark Potter)