Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Debt Investor Presentation (April 2023)
38 slides from Deutsche Bank's debt investor presentation, Apr 28, 2023
Slide 1: Q1 2023 Fixed Income Investor Conference Call
Deutsche Bank Investor Relations Q1 2023 Fixed Income Investor Conference Call #PositiveImpact April 28, 2023 Deutsche Bank Investor Relations
Slide 2: Solid performance in volatile markets
Solid performance in volatile markets Q1 2023 Profitability Resilience Improvement in pre-provision profit to € 2.2bn in the quarter 8% Strong balance sheet, positioned to navigate uncertainty; credit loss 13.6% RoTE1 CET1 Ongoing disciplined expense provisions contained, proving robust 10% ri
Slide 3: Key metrics showing continued improvements
Key metrics showing continued improvements In % Revenue CAGR1 Q1 2023 LTM vs FY 2021 CIR development 25.6 85 Continued revenue momentum, with Group 75 71 revenue CAGR in line with 2025 targets 10.9 6.7 Further improvement in cost/income ratio (CIR); (2.1) (5.7) with pro-rata annualized-bank levies C
Slide 4: Well diversified loan book, CLP guidance unchanged
Well diversified loan book, CLP guidance unchanged Well-diversified loan book Provision for credit losses (in € m) Stage 1+2 Stage 3 In bps of average loans annualized1 By business By region Other Investment Other Bank Asia 24 19 28 28 30 0% 2% 21% 7% North 351 372 350 21% America 292 13 Germany 48%
Slide 5: Balance sheet strength in challenging conditions
Balance sheet strength in challenging conditions Capital & leverage Liquidity & funding Deposits & AuM LCR stable QoQ 41% Highly diversified 13.6% From 12.8% in prior year quarter 143% with € 63bn above regulatory Insured portfolio across client segments, CET1 ratio LCR deposits excl. products and r
Slide 6: Loan-to-deposit ratio at 82%
Loan-to-deposit ratio at 82% In € bn, unless stated otherwise Loan development QoQ YoY 481 493 503 489 488 (0)% 1% Investment Bank 94 99 105 103 103 (0)% 10% Year-on-year growth of 1% (€ 4bn) adjusted for FX effects, Corporate Bank 125 129 129 122 121 (0)% (3)% driven by Investment Bank FIC and Pr
Slide 7: Diversified deposit base
Diversified deposit base In € bn, unless stated otherwise Normalization in non-interest-bearing deposits QoQ YoY Normalized deposits compared to elevated levels in late 2022; 604 613 631 621 592 (5)% (2)% stable-to-improving balances since quarter-end Clients adapting to higher interest rates ye
Slide 8: Strong liquidity coverage ratio above target
Strong liquidity coverage ratio above target In € bn, unless stated otherwise Liquidity coverage ratio (LCR1) LCR 135% 133% 136% 142% 143% ~130% High-quality 227 219 LCR slightly increased quarter on quarter, reflecting prudent 214 207 208 liquid assets liquidity management including year-to-date
Slide 9: Interest rates continued to support PB and CB NIM
Interest rates continued to support PB and CB NIM Divisional NIM development Group NIM development Key highlights Corporate Bank Average interest earnings assets1, in € bn Net interest margin2 4.13% Corporate Bank and Private Bank 3.36% 1.51% NIM show continued favorable 1.47% development due to r
Slide 10: Increase in CET1 ratio from retained earnings
Increase in CET1 ratio from retained earnings Movements in basis points (bps), period end CET1 ratio 30 13.6% 13.4% 1 CET1 ratio up by 25bps compared to Q4 2022 (6) Material net capital build of € 1.1 bn, mainly from net income partly offset by equity compensation RWA change principally in Inves
Slide 11: Capital ratios well above regulatory requirements
Capital ratios well above regulatory requirements In % of RWA, unless stated otherwise, period end 18.5 T2 2.6 272bps Buffer to CET1 requirement of 251bps down 37bps quarter on quarter 15.8 62bps higher requirement as previously communicated AT1 2.3 2.7 T2 requirement4 Higher Pillar 2 requirem
Slide 12: Leverage ratio essentially unchanged
Leverage ratio essentially unchanged In € bn, except movements (in bps), period end 7 4.6% 4.6% 1 (2) Leverage ratio of 4.6%, 6bps increase from Q4 3.75% G-SIB 2022 (2)bps from leverage exposure, mainly Pillar 1 driven by seasonal increase in market 3% requirement making activities in FIC 7bps
Slide 13: Significant buffer over MREL/TLAC requirements
Significant buffer over MREL/TLAC requirements Loss-absorbing capacity, in € bn, period end 127 Senior 8 preferred1 19 Q1 2023 loss-absorbing capacity significantly above all Surplus regulatory requirements, with MREL remaining most 28 binding constraint 35 above Senior requirements 50 non-preferr
Slide 14: Issuance plan at lower end of guidance
Issuance plan at lower end of guidance In € bn, unless stated otherwise Covered bonds Senior structured/preferred Senior non-preferred AT1/T2 26 1 24 20 5 4 17 Issuance plan of € 12-15bn range 1 13-18 7 7 12-15 4 4-5 Year-to-date issuance of € 8bn, more than 50% 1-22 4-5 of full-year target 19 9
Slide 15: Summary and outlook
Summary and outlook Q1 performance demonstrates the resilience and strength of our franchise, profitability and balance sheet Group revenues expected to be around the mid-point of a range between € 28-29bn in 2023 Provision for credit loss guidance range of 25-30 basis points of average loans remain
Slide 16: Appendix
Appendix Deutsche Bank Q1 2023 Fixed Income Investor Call 15 Investor Relations April 28, 2023
Slide 17: Current ratings
Current ratings As of April 28, 2023 Moody‘s Investors Services S&P Global Ratings Fitch Ratings DBRS Counterparty obligations (e.g. deposits/ structured notes/ derivatives/ swaps/ A1 A-1 A- A (high) trade finance obligations) Long-term Preferred2 A1 A- A- A (low) senior unsecured Non-preferred Baa1
Slide 18: Conservatively managed balance sheet
Conservatively managed balance sheet Net in € bn, as of March 31, 2023 Assets Liabilities & equity 1,019 1,019 Trading and Liquidity 174 Resilient balance sheet 241 related liabilities2 reserves1 44 Other liabilities4 Liquidity reserves account around a quarter of net balance sheet Trading and
Slide 19: Derivatives bridge
Derivatives bridge Q1 2023, IFRS derivative trading assets and the impact of netting and collateral, in € bn 246 Gross notional derivative exposure amounts are not exchanged and relate only to the reference amount of all contracts; it is no reflection of the credit or market risk run by a bank O
Slide 20: Loan book composition
Loan book composition Q1 2023, IFRS loans: € 488bn Other IB2 Other1 Leveraged Debt Capital Markets 0% Well-diversified loan portfolio 9% Asset Backed Securities 1% YTD FX impact on loan book is € (2.4)bn German Mortgages 6% 54% of loan portfolio in Private Bank, mainly 32% consisting of retail
Slide 21: Commercial Real Estate (CRE)
Commercial Real Estate (CRE) Focus portfolio comprised of IB and CB non-recourse CRE lending Focus Portfolio: € 33bn IB CRE: € 28bn IB US office loans: € 4.5bn Weighted average LTV 62% US office portfolio remains in focus given significantly lower US occupancy CRE loans € 33bn – 7% of total loan
Slide 22: Provision for credit losses and stage 3 loans
Provision for credit losses and stage 3 loans Provision for credit losses, in € m Stage 3 at amortized cost, in € bn Private Bank Corporate Bank Investment Bank PB (ex-POCI) CB (ex-POCI) IB (ex-POCI) POCI 350 351 372 Group stage 3 2.6% 2.5% 2.5% 2.5% 2.7% 41 loans at 78 amortized 13.0 292 132 64 12.
Slide 23: Stable 12-months rolling average LCR of 136%
Stable 12-months rolling average LCR of 136% In € bn 12-months average high-quality liquid assets (HQLA) 12-M rolling avg. LCR 135% 136% 12-months average HQLA securities 218 219 61 64 Robust liquidity position with 12-months rolling 4 1 4 1 average LCR at 136% 61 64 Level 2B Average LCR broadly
Slide 24: TLTRO development and forecast
TLTRO development and forecast In € bn TLTRO prepayment TLTRO outstanding, period end TLTRO contractual maturity in period 0 0 0 0 3 4 4 3 1 10 11 8 45 45 34 26 22 19 15 12 10 0 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Deutsche Bank Q1 2023 Fixed Income Investo
Slide 25: Net interest income sensitivity
Net interest income sensitivity Hypothetical +/-25bps shift in yield curve, in € m Net interest income (NII) sensitivity1 Key highlights +25bps shift in yield curve -25bps shift in yield curve ~160 ~80 ~80 Current observations on client ~(80) ~(90) pricing show a slower pass through ~(170) of inte
Slide 26: Evolution of market-implied interest rates
Evolution of market-implied interest rates In % ECB deposit facility rate Federal Reserve interest on reserve balances 5.5 5.5 5.0 5.0 4.5 4.5 4.0 4.0 3.5 3.5 3.0 3.0 2.5 2.5 2.0 2.0 04/23 07/23 10/23 01/24 04/24 07/24 10/24 01/25 04/25 07/25 04/23 07/23 10/23 01/24 04/24 07/24 10/24 01/25 04/25 07/
Slide 27: Additional funding disclosure
Additional funding disclosure Q1 2023, capital markets issuance outstanding, in € bn By product By currency Other GBP Capital Instruments (AT1/T2) 6 4 22 Senior 52 non-preferred 118 118 Covered bonds 17 61 EUR USD 46 16 Senior structured1 10 Senior preferred Note: For footnotes refer to slides 35 an
Slide 28: Level 3 assets and liabilities
Level 3 assets and liabilities As of March 31, 2023, in € bn Assets: € 26bn Liabilities: € 11bn Equity securities Mortgage backed securities Other 1 0 Level 3 is an indicator of valuation Other 3 0 Derivative Debt Securities uncertainty and not of asset quality 9 Assets 3 Debt The Group classifi
Slide 29: Leverage exposure and risk-weighted assets
Leverage exposure and risk-weighted assets CRD4, in € bn, period end Leverage exposure Risk-weighted assets 360 360 59 Operational risk RWA 59 1,240 1,238 Market risk RWA Trading assets 92 110 33 24 Credit valuation 6 Derivatives1 130 126 24 adjustments Lending 494 250 493 146 Lending commitments2 C
Slide 30: Value-at-Risk/stressed Value-at-Risk (VaR/sVaR)
Value-at-Risk/stressed Value-at-Risk (VaR/sVaR) In € m, unless stated otherwise VaR, DB Group Trading book, 99%, 1 day Quarterly average 30 47 52 47 51 80 60 40 20 0 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Stressed VaR, DB Group Regulatory scope, 99%, 10 days Quarterly 223 256 173
Slide 31: Simplified legal entity structure of Deutsche Bank AG
Simplified legal entity structure of Deutsche Bank AG America EMEA APAC DWS Notes DB AG DB AG DB AG DWS Group New York Branch London Branch Singapore Branch GmbH & Co. KGaA This chart shows a DB AG selection of DB‘s material Hong Kong Branch operating entities that, together with DB‘s global DB AG
Slide 32: Sustainability
Sustainability Q1 2023 highlights Recent achievements Sustainable Finance1 volumes Increased Sustainable Finance volumes by € 22bn QoQ to € 238bn1 (cumulative since 2020) Signed agreement between DB Private Bank and WWF Germany for advisory service to advance sustainable Sustainable Finance fina
Slide 33: Definition of certain financial measures
Definition of certain financial measures Revenues excluding specific items are calculated by adjusting net revenues under IFRS for specific revenue items which generally fall outside the Revenues usual nature or scope of the business and are likely to distort an accurate assessment of the divisional
Slide 34: Specific revenue items and adjusted costs
Specific revenue items and adjusted costs In € m Q1 2023 Q1 2022 Q4 2022 CB IB PB AM C&O Group CB IB PB AM C&O Group CB IB PB AM C&O Group Revenues 1,973 2,691 2,438 589 (10) 7,680 1,462 3,323 2,220 682 (359) 7,328 1,760 1,675 2,506 609 (236) 6,315 revenue items DVA - IB Other/CRU - 47 - - 2 49 - (8
Slide 35: Pre-provision profit, CAGR and operating leverage
Pre-provision profit, CAGR and operating leverage In € m, unless stated otherwise CAGR2 FY Q1 2023 vs FY 2021 LTM Q1 2023 2021 - LTM Q1 Q1 2022 Q1 2023 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q1 2022 2023 Net revenues Corporate Bank 5,153 1,551 1,564 1,760 1,973 6,848 25.6% 1,462 1,973 35% Investment Bank 9
Slide 36: Footnotes 1/2
Footnotes 1/2 Slide 1 – Solid performance in volatile markets Slide 12 – Significant buffer over MREL/TLAC requirements 1. Throughout this presentation post-tax return on average tangible shareholders’ equity (RoTE) is calculated on 1. Plain vanilla instruments and structured notes eligible for MREL
Slide 37: Footnotes 2/2
Footnotes 2/2 Slide 18 – Derivatives bridge Slide 27 – Level 3 assets and liabilities 1. Excludes real estate and other non-financial instrument collateral 1. Issuances include cash amounts paid on the primary issuance of a loan to a borrower 2. Master Netting Agreements allow counterparties with mu
Slide 38: Cautionary statements
Cautionary statements Forward-looking statements This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts; they include statements about our beliefs and expectations and the assumptions underlying them. These statements are based
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