German lender Deutsche Bank AG and Swiss financial services company UBS Group AG held talks on forming a European alliance, the Wall Street Journal reported on Sunday citing sources familiar with the matter.

According to the sources, the two banks held talks in mid-June to combine their investment banking operations. However, they added that a deal could not be reached as the pair was unable to agree on issues such as structuring and capital allocation.

The two banking giants previously held talks in May over a merger of their asset management negotiations. However, negotiations stalled over disagreement as to who would control the combined €1.4 trillion business.