Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Investor Day (September 2012)
27 slides from Deutsche Bank's investor day presentation, Sep 12, 2012
Slide 1: Corporate Banking & Securities
Deutsche Bank Corporate Banking & Securities Colin Fan & Robert Rankin, Co-Heads of CB&S Investor Day, Frankfurt, 12 September 2012
Slide 2: CB&S overview
CB&S overview — Challenging market conditions – outlook remains uncertain Where we — CB&S is a leading investment banking franchise are today — DB well placed to consolidate success in new environment — Reaffirming client centricity The journey — Fully committed to cultural change to 2015 — Focus, s
Slide 3: Challenging and uncertain macro environment
Challenging and uncertain macro environment Lower global growth Unprecedented policy stimulus Need for deleveraging GDP growth, in % Central bank assets, June 2007 Domestic debt outstanding, Ø 2004-11 normalised to 100 % of GDP Ø 2012-15e 600 7.0 UK 450 550 BoE 5.6 500 350 Europe Fed 450 250 400 ECB
Slide 4: Revenue pools to remain subdued with modest medium-term upside
Revenue pools to remain subdued with modest medium-term upside Primary volumes Secondary volumes 2010 2011 2012F 2010 2011 2012F Outlook Outlook -4% — DCM expected to re- +30% -16% — Activity to remain -8% -31% main robust, particu- strong in some fixed larly if low rates persist income markets — M&
Slide 5: Policymaker action dictating asset valuations
Policymaker action dictating asset valuations Market characteristics Credit asset prices Currencies iTraxx Main spreads in bp (indexed) CHF EUR exchange rate LTRO Swiss central Policy measures intervention bank explicit rate peg distorting asset prices Jan 2012 May 2012 Nov 2010 Aug 2012 Event-drive
Slide 6: Market consolidation and polarization – DB is a likely winner
The market environment will drive increased consolidation and polarization – DB is a likely winner Continued market consolidation Bar-belling of competitive landscape Investment banking top 3 revenue share(1) 2011 returns vs. market share Indicative for Deutsche Bank and peers(2) ~40% High 35% 30% R
Slide 7: DB is a top tier firm with depth and breadth across the business
DB is a top tier firm with depth and breadth across the business Fixed income ranks/shares Equities/Advisory ranks/shares Top 3 Top 3 Top 3 Top 3 Top 5 Top 5 Top 3 Top 5 Top 5 Target Top 5 Top 5 Top 5 Top 3 Top 5 Top 3 Top 5 Top 5 #1 #1 #2 #1 #2 #1 #1 #4 #4 Current #1 #7 #1
Slide 8: Our flow-focused, lower risk business model is well suited to client needs
Our flow-focused, lower risk business model is well suited to client needs Deutsche Bank volumes Higher risk businesses scaled back Number of trades, daily average 1H2012 CB&S resources, current vs. peak levels(1) Cash equities ~2,000,000 (2) (35)% Balance sheet FX Cash 206,000 Bonds 57,000 (3) (39)
Slide 9: CB&S overview
CB&S overview — Challenging market conditions – outlook remains uncertain Where we — CB&S is a leading investment banking franchise are today — DB well placed to consolidate success in new environment — Reaffirming client centricity The journey — Fully committed to cultural change to 2015 — Focus, s
Slide 10: Investment banks play an essential role in the global economy
Investment banks play an essential role in the global economy Valuable functions — Enabling governments and companies to raise capital Capital raising — Providing extensive global distribution networks & distribution — Facilitating investment — Facilitating trade growth and exchange of services Glob
Slide 11: We are redefining our culture to underpin this purpose
We are redefining our culture to underpin this purpose Deutsche Bank commitments CB&S actions — “Tone at the top” communication — “Red flag” status and impact available to We will make our individuals and supervisors – culture reinforced in Linking our cultural values promotion criteria and performa
Slide 12: While retaining our top performers
While retaining our top performers CB&S – our people Our value proposition Performance culture — Relationships with leading global Market — Meritocracy institutions/clients leading client — Stronger differentiation of rewards relationships — Unparalleled service delivery in — Execution and results o
Slide 13: Focus, scale and efficiency will define the future CB&S business
Focus, scale and efficiency will define the future CB&S business CB&S value drivers Focus Scale Efficiency — Re-evaluate the CB&S — Leverage strengths of — Reduce capital portfolio to identify FICC platform consumption across the strategic priorities — Industrialize processes business — Transfer of
Slide 14: Focus: We have re-evaluated the CB&S portfolio to identify strategic priorities
Focus: We have re-evaluated the CB&S portfolio to identify strategic priorities Does the business … Turnaround Invest … align well to trends/outlook? — European equities — FX — APAC equities — Emerging Markets — Rationalize corporate and — Platforms … add value institutional coverage footprint for c
Slide 15: Focus: Reductions in legacy assets continued by Non-Core Operations unit
Focus: Reductions in legacy assets will be further continued by the Non-Core Operations unit SPLIT OPERATING vs. NON-CORE INDICATIVE Significant de-risking of non-core assets, CB&S CB&S post-tax RoE, 2011(1) IAS 39 assets Correlation trading VaR, in EUR m Basel 2 100 16% 90 (42)% 80 70 60 (89)% 9% 5
Slide 16: Focus: We will better align client profitability and capital deployment
Focus: We will better align client profitability and capital deployment Deepening leading client relationships Ranking with client vs. market share % of Corporate clients where DB in top 3 25% 55% 20% 43% Corporate 33% 15% Finance fees 10% 50% 5% US IRD(1) 0% 10 9 8 7 6 5 4 3 2 1 Rank with client 20
Slide 17: Scale: We will continue to leverage our scale in FICC
Scale: We will continue to leverage our scale in FICC(1) Leading FICC franchise Driving further integration opportunities Ranks by market share Rates/ Credit Commod- FX MM Trading ities 2009 2011/12 Sales Structuring Global FI #3 #1 Trade pricing, liquidity Settlement, netting FX #1 #1 Financial res
Slide 18: Scale: Target trading architecture will enable us to recalibrate our cost base
Scale: Our target trading architecture will enable us to recalibrate our cost base Trading operating model for new OTC businesses Industry cost base evolution INDICATIVE Institutional client IT Middle/back-office Front office Voice Electronic Current model Sales AB MDP 47% 43% Deutsche Bank trading
Slide 19: Efficiency: We exceeded our RWA mitigation targets for Basel 2.5
Efficiency: We exceeded our RWA mitigation targets for Basel 2.5 and will manage the impact of Basel 3 CB&S risk-weighted assets In EUR bn Management over-delivered vs. planned EUR 30 bn Basel 2.5 mitigation by containment of Stressed Mitigation until 31 March 2013 VaR and IRC and accelerated reduct
Slide 20: Efficiency: We will continue to align headcount with market opportunities
Efficiency: We will continue to align headcount with market opportunities Resources and opportunities not fully aligned CB&S resource allocation Revenue pool CAGR (2012-2015) — Maintain European leadership EMEA 0% — Grow in Germany — Rescale franchise — Opportunity to win share Americas — Grow US co
Slide 21: CB&S overview
CB&S overview — Challenging market conditions – outlook remains uncertain Where we — CB&S is a leading investment banking franchise are today — DB well placed to consolidate success in new environment — Reaffirming client centricity The journey — Fully committed to cultural change to 2015 — Focus, s
Slide 22: We are taking significant costs out of the business
We are taking significant costs out of the business Contribution to Group aspiration CB&S: Major cost measures 2015 run-rate savings, — Announced 900 front office headcount reduction (in addition to 500 reduction announced in in EUR bn 2012: 4Q2011). Focus on equities/corporate finance in Cost savin
Slide 23: By 2015, a recalibrated CB&S will deliver attractive risk-adjusted returns
By 2015, a recalibrated CB&S will deliver attractive risk- adjusted returns across its portfolio of core businesses CB&S portfolio evolution 2007 – 2015 Post-tax return on equity Operating business 2007 2011 2015 projected Basel 1 Basel 2 Basel 3 (fully loaded) Challenging market environment Capital
Slide 24: From here to there: Aspiration 2015
From here to there: Aspiration 2015 Key take-aways Key metrics for operating business Pro-forma, excluding non-core operations(1) 2011 2015 71% Cost/income <65% Top 3 global investment bank ratio 244 RWA 184 <200 Culture fully aligned to needs equivalent of clients and stakeholders (year-end) 16% 11
Slide 25: Appendix
Deutsche Bank Appendix Investor Day, Frankfurt, 12 September 2012
Slide 26: Reconciliation of key financials shown in presentations
Reconciliation of key financials shown in presentations 2011 SPLIT OPERATING vs. NON-CORE INDICATIVE Re-segmentation Non-Core Operating (1) As reported Operations Other businesses Cost/income ratio 78% (6)ppt (1)ppt 71% RWA (in EUR bn) 229 (52) (3) 173 CB&S Memo: RWA equivalent (in EUR bn) (2) 257 (
Slide 27: Cautionary statements
Cautionary 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 on plans, estimates and pro