Asset management giants UBS and Deutsche Bank are in talks about a possible merger.
The two companies are in 'serious' talks about a deal that would create one of Europe's largest investment companies with more than £1 trillion of assets, the Financial Times reports.
A source close to the talks told the Financial Times that discussions about a merger have been ongoing for a couple of months.
No arrangement has been agreed but one potential deal under discussion would involve UBS selling its £700 billion asset management business to Deutsche Bank in exchange for shares in the larger business. UBS Asset Management would then become part ofDWS, the asset management arm of Deutsche.
If a deal is agreed the two companies will follow in the footsteps of asset management rivals including Janus and Henderson and Standard Life and Aberdeen. Analysts have predicted further deals are likely this year as larger companies such as Vanguard and BlackRock have been handed a competitive advantage in recent years.
However sources cautioned the Financial Times that no deal has yet been reached and no announcement is imminent.