Commerzbank Ag · XETR:CBK
Commerzbank — FY2012 Earnings Presentation
42 slides from Commerzbank's earnings presentation, Feb 15, 2013
Slide 1: Commerzbank 2012: strategic realignment set on course
Commerzbank 2012: strategic realignment set on course Analyst conference – preliminary 2012 results Stephan Engels | CFO | Frankfurt | 15 February 2013
Slide 2: Commerzbank in FY2012 at a glance
Commerzbank in FY2012 at a glance Strategic realignment of Commerzbank initiated with new targets and strategic agenda, new brand positioning, realignment of PC and establishment of NCA Good start to Non-Core wind-down with €30bn EaD (incl. NPL) reduction already achieved in FY2012, reducing NCA por
Slide 3: Adjusted revenues before LLP stable in Group and Core Bank
Revenues before LLP adjusted for extraordinary effects show stable and solid revenues before LLP in Group and Core Bank Group Core Bank Adjusted revenues before LLP Adjusted revenues before LLP €m €m -3% 11,113 9,748 10,525 10,206 2,707 2,300 2,434 2,307 FY 2011 FY 2012 Q1 12 Q2 12 Q3 12 Q4 12 2,723
Slide 4: Core Bank with solid adjusted operating result of €2.8bn in 2012
Core Bank with solid adjusted operating result of €2.8bn in 2012 Group Core Bank Adjusted operating result Adjusted operating result €m €m +33% 1,521 3,140 2,845 1,143 1,010 722 558 747 530 429 287 84 FY 2011 FY 2012 Q1 12 Q2 12 Q3 12 Q4 12 FY 2011 FY 2012 Q1 12 Q2 12 Q3 12 Q4 12 Operating result (r
Slide 5: Core Bank adjusted operating result, significant cost reduction in FY 2012
Core Bank with solid adjusted operating result, significant cost reduction in FY 2012 Quarterly transition Group OCS, Liability €m Management & -9% 4,655 sale of PSB -45% 1,515 3,140 871 2,845 288 2,557 1,365 199 Reported OCS, Adjusted Revenues LLP Costs Adjusted OCS, Reported operating Liab Mgmt op
Slide 6: Core Bank FY 2012 operating results
Core Bank FY 2012 operating results Private Customers – Operating result Mittelstandsbank – Operating result €m €m +4% -49% Significant cost reduction 1,649 MSB with another record 1,588 476 of 15% y-o-y in PC result in FY 2012 driven by cost discipline and very Falling interest rates and low LLP le
Slide 7: Q4 group net result of €-716m – Core Bank with solid result
Q4 group net result of €-716m – Core Bank with solid result Solid operating result in Core Bank of €530m excl. OCS effect of €-118m Core Bank revenue development in Q4 almost stable vs. Q3, commission and trading income weaker in-line with seasonality, compensated by better net investment income Gro
Slide 8: Commerzbank Financials at a glance
Commerzbank Financials at a glance Group Q4 2011 Q3 2012 Q4 2012 12M 2011 12M 2012 Operating result (€m) 163 216 -35 507 1,216 Core Tier 1 ratio B 2.5 (%) 9.9 12.2 12.0 9.9 12.0 RWA (€bn) 237 206 208 237 208 Leverage ratio (%) 21 19 19 21 19 Core Bank (incl. O&C) Q4 2011 Q3 2012 Q4 2012 12M 2011 12M
Slide 9: Group operating result influenced by negative OCS effect and higher LLPs
Group operating result influenced by negative OCS effect and higher LLPs in-line with previous company guidance Quarterly transition Group €m -116% 216 26 184 163 41 -35 DTA impairment 560 681 -716 1) Operating Operating Revenues LLP Costs Operating Tax, Net result result result result Minorities, Q
Slide 10: Core Bank: Almost stable net interest income in Q4 vs. Q3
Core Bank: Almost stable net interest income in Q4 vs. Q3 Revenue split €m ▲ Almost stable net interest income development in Q4 vs. -8% Q3, but still on a low level 3,439 -36% 970 ► Commission income seasonally weaker Q4 vs. Q3 but Other 2,379 2,189 stable y-o-y NTI 363 97 246 16 241 NCI 719 815 72
Slide 11: Core Bank: costs nearly flat in Q4 vs. Q3
Core Bank: With costs nearly flat in Q4 vs. Q3, full year €871m below FY 2011 Cost split Cost income ratio €m % 98 +2% 94 +1% 90 PC 84 91 1) 1,666 1,640 1,675 77 C&M 69 Core Bank 845 915 65 980 60 CEE 58 48 45 821 760 MSB 660 44 46 39 Q4 2011 Q3 2012 Q4 2012 Q4 2011 Q3 2012 Q4 2012 Pers. expenses Op
Slide 12: Core Bank: LLP still on a low level
Core Bank: LLP still on a low level benefitting from sound portfolio structure and robust German economy LLP split €m +117% ▲ Good portfolio quality – Risk density expected to remain 174 -41% low PC ▲ Default portfolio further reduced – NPL ratio on a very low 149 MSB 102 level 47 16 CEE 24 45 42 ▲
Slide 13: Core Bank Q4 operating results
Core Bank Q4 operating results Private Customers – Operating result Mittelstandsbank – Operating result €m €m -5% +30% In a difficult environment 395 Continues to generate 376 operating result remains stable results supported -27% 290 on a low level by low LLP level due to 140 -79% robust German eco
Slide 14: Private Customers: operating result remains on a low level
Private Customers: In a difficult environment operating result remains on a low level Quarterly transition €m 140 -27% 41 12 30 28 29 Operating result Operating result Revenues LLP Costs Operating result Q4 2011 Q3 2012 Q4 2012 Ø equity (€bn) 4.2 Ø equity (€bn) 4.0 Ø equity (€bn) 3.8 Op. RoE (%) 13.
Slide 15: PC divisional split
PC divisional split Filialbank – Revenues before LLP Commerz Real – Revenues before LLP €m €m 778 697 691 › Increasing NII in Q4 due to active margin management › Seasonally weaker NCI in Q4 53 56 39 › Decreasing revenues due to lower business activity in Q4 › Net new customers of 26 thousand during
Slide 16: Mittelstandsbank: stable results supported by low LLP level
Mittelstandsbank: Continues to generate stable results supported by low LLP level due to robust German economy Quarterly transition €m -5% 395 51 51 376 19 290 Operating result Operating result Revenues LLP Costs Operating result Q4 2011 Q3 2012 Q4 2012 Ø equity (€bn) 6.9 Ø equity (€bn) 5.8 Ø equity
Slide 17: MSB divisional split
MSB divisional split Mittelstand Germany – Revenues before LLP Corporate Banking & International – Revenues before €m LLP €m › Increasing revenues from 391 376 › Stable revenues from international business 364 loan business 278 282 › Q4 including restructuring 234 › Declining deposit margin of loans
Slide 18: Central & Eastern Europe: Good result at BRE Bank in Q4
Central & Eastern Europe: Good result at BRE Bank in Q4, portfolio realignment of CEE completed in 2012 Quarterly transition €m 194 Sale of PSB effect 154 -19% 52 42 14 4 0 40 Operating Operating Revenues LLP Costs Operating result Q4 2011 result Q3 2012 result Q4 2012 Ø equity (€ bn) 1.9 Ø equity (
Slide 19: Corporates & Markets: positive operating result excl. OCS effect
Corporates & Markets: Excl. OCS effect positive operating result in seasonally weak quarter Quarterly transition €m OCS effect Op. result excl. OCS effect Reported 1) 191 -80% 121 27 246 36 40 75 49 -48 -55 -118 -69 Operating result Operating result Revenues 1) LLP Costs Operating result Q4 2011 Q3
Slide 20: Corporates & Markets divisional split
Corporates & Markets divisional split Corporates – Revenues before LLPs EMC – Revenues before LLPs €m €m › Stable performance in 225 securitised products and 212 › Good Q4 performance in 158 Commodities business but all main product areas 108 119 seasonally lower revenues › Revenues supported by in
Slide 21: NCA: Better revenue development partly offset by Ship Finance LLPs
NCA: Better revenue development in Q4 partly offset by higher Ship Finance LLPs Quarterly transition €m 129 164 6 -476 -447 6% -1,391 Operating result Operating result Revenues LLP Costs Operating result Q4 2011 Q3 2012 Q4 2012 Ø equity (€bn) 10.6 Ø equity (€bn) 10.1 Ø equity (€bn) 9.6 EaD incl. NPL
Slide 22: NCA: Significant portfolio reduction in all sub-segments in Q4
NCA: Significant Portfolio reduction in all sub-segments in Q4 LLP €m +34% ▲ NCA run-down mainly in CRE and Public Finance, EaD Public Finance +183% 512 (incl. NPL) reduction of €9bn in Q4 CRE 145 383 Deutsche ▲ NCA reduction target for 2016 confirmed Schiffsbank 160 151 DSB 181 parameter ▼ Signific
Slide 23: Core Tier 1 ratio at 12.0% – RWA almost flat Q4 vs. Q3
Core Tier 1 ratio at 12.0% – RWA almost flat Q4 vs. Q3 RWA Core Tier 1 capital & ratio €bn €bn › Significant RWA reduction y-o-y › Significant increase of 210bps in CT 1 › Small RWA increase Q4 vs. Q3 driven ratio y-o-y, small decrease by parameter updates in NCA Ship Q4 vs. Q3 due to RWA developmen
Slide 24: Basel III CET 1 comfortably above 9% under phase-in
Basel III CET 1 comfortably above 9% under phase-in Basel 2.5 CT 1 and Basel III CET 1 ratios % 12.0 Pro-forma 1.8 10.2 Capital deduction of 2.6 securitizations 7.6 Defined benefit pension gap Revaluation reserve DTA deduction SoFFin silent participation Minority interests Basel 2.5 Basel III Basel
Slide 25: Limited unsecured issuance in 2012 – flexible funding approach
Limited unsecured issuance in 2012 – flexible funding approach to support franchise demand and diversify funding Capital Market Funding History & Outlook €bn › Ongoing asset reduction and good deposit base limits capital market 21 funding need › Capital market funding depending on franchise demand a
Slide 26: Conclusion and Outlook 2013
Conclusion and Outlook 2013 Transformation of Commerzbank is main focus for 2013 with implementation of cost measures, new brand positioning and growth investments into products, markets and clients Ongoing asset reduction in NCA and low interest rate environment will put further pressure on revenue
Slide 27: Appendix: Segment reporting
Appendix: Segment reporting Stephan Engels | CFO | Frankfurt | 15 February 2013 27
Slide 28: German economy 2013 – Gearing up for a strong year in 2014
German economy 2013 – Gearing up for a strong year in 2014 Current development Our expectation for 2013/2014 Reasons for outperformance › German economy has slowed down › The latest powerful rise in leading No bubbles in the housing market significantly at the end of 2012. GDP indicators suggests th
Slide 29: 22% of CRE and 26% of Ship Finance portfolio within higher risk cluster
22% of CRE and 26% of Ship Finance portfolio within higher risk cluster 1) Cluster Commercial Real Estate Q4/12 Q3/12 Ship Finance Q4/12 Q3/12 EaD in €bn EaD in €bn • UK 5.2 • Bulk Carrier (Capesize/VLOC) 1.2 • Spain 3.6 • Container < 2,000 TEU 0.5 higher 10.6 11.7 3.7 4.2 risk • Hungary 0.3 (23%) (
Slide 30: Default Portfolio (Q4 2012)
Default Portfolio (Q4 2012) Default portfolio and coverage ratios by segment €m – excluding/ including GLLP Group1 18,926 87% / 92% 17,332 7,148 9,296 887 Private Customers 1,135 81% / 92% 1,048 392/527/128 M ittelstandsbank 2,632 73% / 82% 2,154 1,439 /482/ 232 Central & Eastern Europe 1,069 90% /
Slide 31: Commerzbank Group
Commerzbank Group Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 1,727 1,790 1,589 1,618 6,724 1,429 1,333 1,379 1,398 5,539 -13.6 1.4 Provisions for loan losses -318 -278 -413 -381 -1,390 -212 -404 -430 -614 -1,660 61.2 42.8
Slide 32: Core Bank
Core Bank Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 1.448 1.542 1.357 1.387 5.734 1.238 1.138 1.221 1.211 4.808 -12,7 -0,8 Provisions for loan losses -83 -50 -175 -174 -482 -18 -116 -47 -102 -283 -41,4 117,0 Net interest
Slide 33: Private Customers
Private Customers Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 514 534 513 546 2.107 473 449 449 464 1.835 -15,0 3,3 Provisions for loan losses -45 -38 -33 55 -61 -8 -26 -45 -16 -95 -129,1 -64,4 Net interest income after pro
Slide 34: Mittelstandsbank
Mittelstandsbank Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 534 606 551 563 2.254 543 488 469 454 1.954 -19,4 -3,2 Provisions for loan losses -11 28 -58 -149 -190 35 -32 9 -42 -30 -71,8 -566,7 Net interest income after pro
Slide 35: Central & Eastern Europe
Central & Eastern Europe Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 137 147 150 139 573 120 121 120 121 482 -12,9 0,8 Provisions for loan losses -27 -9 -26 -24 -86 -18 -35 -28 -24 -105 0,0 -14,3 Net interest income after p
Slide 36: Corporates & Markets
Corporates & Markets Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 160 225 141 306 832 119 113 143 171 546 -44,1 19,6 Provisions for loan losses 0 -31 -59 -56 -146 -27 -23 17 -19 -52 -66,1 -211,8 Net interest income after pro
Slide 37: Non-Core Assets
Non-Core Assets Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 274 235 225 207 941 186 158 158 187 689 -9.7 18.4 Provisions for loan losses -236 -231 -255 -181 -903 -178 -301 -383 -512 -1,374 182.9 33.7 Net interest income aft
Slide 38: Portfolio Restructuring Unit
Portfolio Restructuring Unit Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 5 13 7 24 49 5 37 - 0 42 - - Provisions for loan losses 1 3 17 -26 -5 -16 13 - 0 -3 - - Net interest income after provisions 6 16 24 -2 44 -11 50 - 0
Slide 39: Others & Consolidation
Others & Consolidation Q1 Q2 Q3 Q4 12M Q1 Q2 Q3 Q4 12M in € m % yoy % qoq 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 Net interest income 103 30 2 -167 -32 -17 -33 40 1 -9 -100,6 -97,5 Provisions for loan losses 0 -0 1 0 1 0 -0 -0 -1 -1 - - Net interest income after provisions 103 30 3 -167 -3
Slide 40: Group equity definitions
Group equity definitions Reconciliation of equity definitions Equity basis for RoE Reconciliation of equity definitions Q4 2012 12M End of Equity definitions in €m Average Period Subscribed capital 5,828 5,609 Capital reserve 11,681 11,307 Retained earnings 8,829 9,110 Silent participations SoFFin /
Slide 41: For more information, please contact Commerzbank's IR team
For more information, please contact Commerzbank´´s IR team: Tanja Birkholz (Head of Investor Relations / Executive Management Board Member) P: +49 69 136 23854 M: tanja.birkholz@commerzbank.com Jürgen Ackermann (Europe / US) Ute Heiserer-Jäckel (Retail Investors) P: +49 69 136 22338 P: +49 69 136 4
Slide 42: Disclaimer
Disclaimer Investor Relations This release contains forward-looking statements. Forward-looking statements are statements that are not historical facts. In this release, these statements concern the expected future business of Commerzbank, efficiency gains and expected synergies, expected growth pro