Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Debt Investor Presentation (October 2024)
41 slides from Deutsche Bank's debt investor presentation, Oct 24, 2024
Slide 1: Q3 2024 Fixed Income Investor Conference Call
Deutsche Bank Investor Relations Q3 2024 Fixed Income Investor Conference Call October 24, 2024
Slide 2: Disciplined execution driving continuously improving performance
Disciplined execution driving continuously improving performance In € bn, unless stated otherwise Pre-provision profit1 Revenues Costs Year-on-year By division3 Adjusted costs +5% +17% 22.2 +3% 22.9 (1)% Group 5.6% 69% CAGR, Q3 2024 LTM vs. FY 20214 7.0 22.1 +3% 22.8 15.3 15.1 Cost/income ratio 6.0
Slide 3: Ongoing momentum across businesses through focused growth strategies
Ongoing momentum across businesses through focused growth strategies 9M 2024, unless stated otherwise Corporate Bank Investment Bank 18% increase year on year in incremental deals won1 Growth in activity with priority clients – activity with top with multinational corporate clients ~100 institut
Slide 4: Continued execution across strategic pillars
Continued execution across strategic pillars Revenue growth Efficiency measures Capital efficiency 5.5-6.5% € 2.5bn € 25-30bn 2 Revenue CAGR 2021-2025 targeted Operational efficiencies targeted RWA reductions targeted 5.6% revenue CAGR1 in Q3 2024 LTM vs. FY € 1.7bn delivered or expected savings Rea
Slide 5: Provision for credit losses
Provision for credit losses In € m, unless stated otherwise Key highlights Stage 1+2 Stage 3 In bps of average loans annualized1 30 33 20 41 37 40 41 488 494 439 476 12 30 35 Q3 2024 provision for credit losses slightly higher sequentially 372 401 due to increased Stage 3 provisions 63 245 Stage
Slide 6: Provisioning trends
Provisioning trends Provision for credit losses, in € m, unless stated otherwise Key highlights 494 40 50 Q3 2024 107 298 Key portfolio quality indicators closely monitored and broadly stable; no indication of structural deterioration in underlying asset quality Persisting specific drivers affec
Slide 7: Lending stable and temporarily elevated deposit levels
Lending stable and temporarily elevated deposit levels In € bn, unless stated otherwise Loan development1,2 Key highlights QoQ YoY 485 479 480 482 477 (0)% (0)% Loans remained stable during the quarter adjusted for FX: Investment Bank 103 101 103 106 2% 5% Continued FIC Financing growth from new
Slide 8: Stable net interest income (NII) in banking book segments in 2024
Stable net interest income (NII) in banking book segments in 2024 In € bn, unless stated otherwise Group development Key banking book segment1 development 1.4% 1.3% 1.3% 1.2% 1.3% 3.9% 4.1% 4.2% 4.1% 3.7% Corporate Bank 3.3 3.2 3.1 3.0 3.3 1.2 1.3 1.3 1.3 1.2 0.1 0.0 Q3 2023 Q4 2023 Q1 2024 Q2 2024
Slide 9: Interest rate hedge stabilizing NII in declining yield environment
Interest rate hedge stabilizing NII in declining yield environment In € bn, unless stated otherwise Income from long-term hedge portfolio1 Key highlights Avg yield 10y EUR swap Locked-in Roll-over 3.0% 2.5% 2.3% 2.4% 2.5% 1.9% 1.8% Hedge contribution to NII steadily increased since 1.6% 2022 1.4%
Slide 10: Limited NII sensitivity
Limited NII 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 ~135 ~70 ~(20) ~15 ~(75) ~(140) 2025 2026 2027 Low NII sensitivity reflecting dynamic hedge strategy responding t
Slide 11: CET1 ratio increase reflecting strong Q3 earnings
CET1 ratio increase reflecting strong Q3 earnings As of September 30, 2024, period end CET1 ratio, movements in basis points (bps) Key highlights 44 13.8% CET1 ratio up by 30bps compared to Q2: 13.5% 0 34bps from strong Q3 earnings net of deductions, and ~€ 3bn RWA equivalent capital efficiency
Slide 12: Capital ratios well above regulatory requirements
Capital ratios well above regulatory requirements As of September 30, 2024, in % of RWA, unless stated otherwise Key highlights 18.7 T2 2.1 287bs 15.8 AT1 2.8 2.7 T2 requirement4 Buffer to CET1 requirement of 261bps, up 31bps quarter-on- quarter in line with CET1 ratio development 261bps Equival
Slide 13: Leverage ratio stable
Leverage ratio stable As of September 30, 2024, movement in bps, unless stated otherwise Key highlights 4.6% 2 12 4.6% (14) 3.85% 0.75% G-SIB 0.10% Pillar 2 requirement Pillar 1 3.00% Leverage ratio materially flat compared to Q2: requirement 12bps Tier 1 capital change in line with CET1 capital
Slide 14: Significant buffer over MREL/TLAC requirements
Significant buffer over MREL/TLAC requirements As of September 30, 2024, loss-absorbing capacity, in € bn unless stated otherwise Key highlights 131 Senior preferred1 14 21 Surplus 28 30 above Senior requirements non-preferred 50 Q3 2024 loss-absorbing capacity significantly above all regulatory r
Slide 15: Sound liquidity and funding base
Sound liquidity and funding base In € bn, unless stated otherwise Liquidity coverage ratio (LCR)1 Key highlights 3M daily avg. High-quality liquid assets (HQLA) LCR 136% 131% 136% 131% 137% Daily average LCR increased to 137% LCR 132% 140% 136% 136% 135% ~130% HQLA increase driven by deposit gro
Slide 16: Issuance plan for the year almost completed
Issuance plan for the year almost completed In € bn, unless stated otherwise Key highlights Covered bonds Senior preferred2 Senior non-preferred AT1/T2 24 4 17 13-18 1 17 16 1 16 7 1 Credit spreads developed well quarter-on-quarter, 4 3 8 particularly in the capital space with double-digit spread
Slide 17: Summary and outlook
Summary and outlook Revenue trajectory on track to meet € 30bn full-year target, supported by momentum in all businesses Ongoing focus on managing adjusted cost run rate down, through disciplined spend and efficiency measures Provision for credit losses of ~€ 1.8bn for the full-year, with normalizat
Slide 18: Appendix
Appendix Deutsche Bank Investor Relations Q3 2024 Fixed Income Conference Call, October 24, 2024 18
Slide 19: Current ratings
Current ratings As of October 23, 2024 Morningstar Moody‘s Investors Services S&P Global Ratings Fitch Ratings DBRS Counterparty obligations (e.g. deposits / structured notes / derivatives / swaps / A1 A1 A AA (low) trade finance obligations) Long-term Preferred2 A1 A A A senior unsecured Non-prefer
Slide 20: Capital markets issuance outstanding
Capital markets issuance outstanding As of September 30, 2024, in € bn By product1 By currency1 Capital Instruments Other (AT1/T2) GBP 7 4 22 Senior 55 non-preferred Covered bonds 15 120 120 65 EUR USD 44 13 Senior structured 15 Senior preferred Notes: for footnotes refer to slides 39 and 40 Deutsch
Slide 21: Conservatively managed balance sheet
Conservatively managed balance sheet As of September 30, 2024, net1 in € bn Assets Liabilities & Equity Stable funding mix High-quality loan portfolio 1,082 1,082 Investment grade Trading and Weighted-average life 171 69% Corporate Bank HQLA4 230 related liabilities5 7y in long-term debt exposure2 p
Slide 22: Asset quality in Germany
Asset quality in Germany In € bn, unless stated otherwise German loan book well diversified Solid fundamentals in home market Stable baseline CLPs5 in Germany Provision for credit losses, in bps 68% (2) 2.8% +0.5 Corporate Bank ppt YTD ppt YTD Germany (baseline) Germany (reported) Investment Bank In
Slide 23: Stable and well diversified deposit portfolio
Stable and well diversified deposit portfolio € 650bn deposit base as of September 30, 2024 Investment Bank & Treasury Term deposits Term deposits Other APAC / MEA Americas Institutional 4% Corporate Bank 4% 7% 11% Client Services 12% 13% Europe excl. Germany Personal Banking 29% 13% 38% Private Ban
Slide 24: Loan book composition
Loan book composition Q3 2024, IFRS loans: € 477bn1 Key highlights Other2 Other IB3 0% 11% Leveraged Debt Capital Markets German Mortgages and 1% Home Loans & Savings 54% of loan portfolio in Private Bank, consisting of retail Asset Backed Securities mortgages mainly in Personal Banking (Germany)
Slide 25: Commercial Real Estate (CRE) 1 / 2
Commercial Real Estate (CRE) 1 / 2 CRE non-recourse portfolio: € 37bn € 30bn in scope of severe stress test2 By region By region Non-recourse € 37bn – 8% of total loans1 APAC APAC EU 1% € 7bn deemed as lower risk, includes data centers and 8% 21% municipal social housing CRE higher risk loans
Slide 26: Commercial Real Estate (CRE) 2 / 2
Commercial Real Estate (CRE) 2 / 2 US CRE in scope of severe stress test1: € 15bn US CRE loan risk management US CRE loan risk management In € bn In € m By type Office: € 7bn Cumulative modified loans CLPs per quarter New York 13 130 Other 123 121 Other Office 18% 27% Miami 30% 46% Philadelphia 3% 2
Slide 27: Leverage exposure and risk-weighted assets
Leverage exposure and risk-weighted assets CRD4, in € bn, period end Leverage exposure Risk-weighted assets 356 356 58 Operational risk RWA 58 1,262 1,284 Market risk RWA Trading assets 126 143 33 26 Credit valuation 3 Derivatives1 128 125 18 adjustments Lending 469 464 147 Lending Credit risk RWA 2
Slide 28: Derivatives bridge
Derivatives bridge Q3 2024, IFRS derivative trading assets and the impact of netting and collateral, in € bn Key highlights 243 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 ru
Slide 29: Level 3 assets and liabilities
Level 3 assets and liabilities As of September 30, 2024, in € bn Assets: € 26bn Liabilities: € 13bn Key highlights Other Other 3 0 Derivative 8 Assets Level 3 is an indicator of valuation Debt Debt Securities securities 5 5 uncertainty and not of asset quality The Group classifies financial inst
Slide 30: Group Trading Book Value-at-Risk (VaR) and stressed Value-at-Risk (sVaR)
Group Trading Book Value-at-Risk (VaR) and stressed Value-at-Risk (sVaR) As of September 30, 2024, in € m, 99% confidence level Trading P&L1, VaR sVaR 500 160 400 250 300 120 172 162 200 121 100 80 44 0 34 33 40 25 -100 -200 0 -300 -400 (40) -500 (80) Q4 2023 Q1 2024 Q2 20242 Q3 2024
Slide 31: Q3 2024 highlights
Q3 2024 highlights In € bn, unless stated otherwise Financial results Divisional revenues Key highlights Q3 2024 Δ vs. Δ vs. +5% +5% Δ vs. Q3 2023 Q2 2024 Q3 2023 Statement of income 7.5 Revenues 7.5 5% (1)% 7.1 Revenues ex-specific items1 7.5 5% (2)% 0.5 102% 4% Provision for credit losses 1.8 (3)%
Slide 32: 2025 financial targets and capital objectives
2025 financial targets and capital objectives Financial targets Capital objectives > 10% 5.5-6.5% < 62.5% ~ 13% 50% Post-tax RoTE Revenue CAGR Cost/income ratio CET1 ratio Total payout ratio in 2025 2021-2025 in 2025 from 2025 Well-positioned to Increased revenue Reiterate CIR target, with Aim to op
Slide 33: Sustainability
Sustainability Q3 2024 highlights Recent achievements Sustainable Finance1 volumes Increased Sustainable Finance volumes by € 30bn to € 352bn1 (cumulative since 2020), including a € 10bn one-off contribution following integration of ESG criteria in Deutsche Bank’s German pension plans, which is re
Slide 34: Deutsche Bank's performance in leading ESG ratings
Deutsche Bank’s performance in leading ESG ratings As of October 23, 2024 Score range Rating score Rating agency ESG rating criteria (weighting) Rating development (best to worst) DB Corporate Governance & Corporate Behavior Privacy & Data Security (15%) (35%) Responsible Investment (15%) AAA
Slide 35: 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 usual nature or scope of the Revenues excluding business and are likely to distort an accurate assessment of the
Slide 36: Specific revenue items and adjusted costs – Q3 2024
Specific revenue items and adjusted costs – Q3 2024 In € m, unless stated otherwise Q3 2024 Q3 2023 Q2 2024 CB IB PB AM C&O Group CB IB PB AM C&O Group CB IB PB AM C&O Group Revenues 1,841 2,523 2,319 660 157 7,501 1,890 2,271 2,341 594 35 7,132 1,922 2,599 2,331 663 74 7,589 Specific revenue items
Slide 37: Pre-provision profit, CAGR and operating leverage
Pre-provision profit, CAGR and operating leverage In € m, unless stated otherwise CAGR2 FY 2021 – 9M 2024 vs FY 2021 Q3 2024 LTM 9M 2023 9M 2024 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q3 2024 LTM 9M 2023 Net revenues Corporate Bank 5,153 1,912 1,878 1,922 1,841 7,553 14.9% 5,807 5,642 (3)% Investment Bank
Slide 38: Pre-provision profit, post-tax RoTE, CIR and operating leverage ex-Postbank litigation
Pre-provision profit, post-tax RoTE, CIR and operating leverage ex-Postbank takeover litigation provision impact In € m, unless stated otherwise Q3 2023 Q3 2024 9M 2023 9M 2024 Pre-provision profit 1,968 2,757 5,998 6,118 Provision for credit losses (245) (494) (1,017) (1,410) Profit (loss) before t
Slide 39: Footnotes 1/2
Footnotes 1/2 Slide 2 – Disciplined execution driving continuously improving performance Slide 11 – CET1 ratio increase reflecting strong Q3 earnings 1. Defined on slide 35 and detailed on slide 37 1. Including credit valuation adjustment (CVA) risk-weighted assets 2. Adjusted for the Postbank takeo
Slide 40: Footnotes 2/2
Footnotes 2/2 Slide 21 – Conservatively managed balance sheet Slide 27 – Leverage exposure and risk-weighted assets 1. Net balance sheet of € 1,082bn is defined as IFRS balance sheet (€ 1,380bn) adjusted to reflect the funding 1. Excludes any derivatives-related market risk RWA, which have been full
Slide 41: 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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