The arrangement will see the bank accelerate its plan to transition services to the cloud but also co-develop products with engineers from Google Cloud with the two parties sharing any revenue that arises.

A letter of intent has been signed and a multi-year contract will be agreed in the coming months. No details of the financial arrangements have yet been disclosed but according to sources cited by Bloomberg, the deal is believed to run for 10 years and Deutsche expects to realise a cumulative return on investment in excess of $1bn.

The bank, Germany's biggest lender, has prioritised a revamp of its infrastructure as it seeks to cut costs. Almost exactly a year ago in July 2019, it announced plans to cut its workforce by 18,000 - equivalent to a fifth of its workforce. But the bank also pledged to invest €13bn on new technology over the next four years.

Christian Sewing, the CEO appointed in April 2018, has descibed the deal with Google Cloud as "an important driver of our strategic transformation" and said it is "as much a revenue story as it is about costs". 

Much is likely to be made of the co-development part of the deal with Google Cloud and Deutsche has referenced the fact it will gain access to the data science, AI and machine learning capabilities of its new partner. Potential use cases include cash flow forecasting and risk analysis for treasury clients and digital services for the private banking business. 

"This cooperation with Google Cloud is a significant step forward for our technology strategy and will transform the way we produce and deliver client services," said chief technology, data and innovation officer at Deutsche, Bernd Leukert who was brought in from SAP in 2019 with a mandate to develop a central technology division that will oversee tech security, data and innovation functions.

The deal is also a success for Google which managed to beat off competition from Amazon and Microsoft in a three month tender process that began in February. Up till this year, Google Cloud's only major banking client was HSBC but a five year deal was signed in March 2020 with UK high street bank Lloyds.

“We’re excited about our strategic partnership and the opportunity for Google Cloud to be helpful to Deutsche Bank and its clients as they grow their business and shape the future of the financial services industry,” said Sundar Pichai, CEO of Google's parent company Alphabet.