Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Investor Day (December 2009)
36 slides from Deutsche Bank's investor day presentation, Dec 14, 2009
Slide 1: Management Agenda Phase 4: Strategy for a new era
Management Agenda Phase 4: Strategy for a new era Dr. Josef Ackermann Chairman of the Management Board Investor Day Frankfurt, 14 December 2009
Slide 2: Agenda
Agenda 1 Recent history and current context 2 Our strategy for a new era 3 Financial potential and summary Investor Relations 12/09 · 2
Slide 3: In 2002 we launched an ambitious transformation agenda
In 2002 we launched an ambitious transformation agenda Phase 3: A Accelerating l ti growth th Phase 2: Growth and 25% RoE Phase 1: Refocusing the business Maintaining Continue to our cost, invest in Maintainingg risk, capital organic Performance Capitalising C it li i and growth and strict cost, Foc
Slide 4: We closed the performance gap versus peers
We closed the performance gap versus peers Reported, in % Pre-tax RoE Cost Income Ratio 40 95 33 29 30 Peer Group(1) 26 85 82 30 79 80 23 20 26 75 24 20 75 77 70 70 13 16 71 70 10 65 68 11 10 67 Peer Group(1) 64 0 55 2002 2003 2004 2005 2006 2007 2002 2003 2004 2005 2006 2007 (1) Peer group includes
Slide 5: Lesson from the crisis: No single winning model, but winning competencies
Lesson from the crisis: No single winning model, but winning competencies Share p price development p from 1 July y 2007 to 2 December 2009, in local currency, y in % Investment banks Diversified banks Commercial banks ((23)) (13) (9) (100) (1) (92) (81) (1) Until 17 September 2008 Source: Bloomberg
Slide 6: Imperatives in the new era: Do more with less
Imperatives in the new era: Do more with less Industry-wide deleveraging … … and increasing equitization Total assets / total equity per end of period(1) Average Tier 1 ratio, top 20 European banks(2) 23 11.0% 22 21 10.0% Ø 9.5% 9.0% Ø 8.3% 17 8.0% Ø 8.2% Ø 8.1% 15 7.0% 6.0% 2005 2006 2007 2008 9M20
Slide 7: Imperatives in the new era: Seize opportunities in stabilizing capital markets
Imperatives in the new era: Seize opportunities in stabilizing capital markets Recovery of equity markets Significant market share up for capture Indexed values, 100 = 1 Jan 2008 Deutsche Bank Merged or exited Remainder 100 S&P 500 U.S. IRD 80 EM Bonds DAX 60 EU Investment 40 Grade Credit DJ Stoxx B
Slide 8: Imperatives in the new era: Seize opportunities in emerging markets
Imperatives in the new era: Seize opportunities in emerging markets Further financial ‘deepening’ … ... will drive revenue pool growth Financial stock(1), % of GDP Deutsche Bank revenues vs. global revenue pools 252 100% 100% 100% A i /P Asia/Pac. excl. Japan 11% 18% Japan 2% 25% 8% 131 8% 115 Europ
Slide 9: Agenda
Agenda 1 Recent history and current context 2 Our strategy for a new era 3 Financial potential and summary Investor Relations 12/09 · 9
Slide 10: Where do we go from here?
Where do we go from here? Leading global corporate and d investment i t t bank b k… Investor Relations 12/09 · 10
Slide 11: Where do we go from here?
Where do we go from here? Leading global … supported by a private client corporate franchise with undisputed and d investment i t t bank b k… l d hi in leadership i our home h market k t… Investor Relations 12/09 · 11
Slide 12: Where do we go from here?
Where do we go from here? Leading global … supported by a private client … and a strong corporate franchise with undisputed Asian growth engine and d investment i t t bank b k… l d hi in leadership i our home h market k t… Investor Relations 12/09 · 12
Slide 13: Our strategy for a new era: Management Agenda Phase 4
Our strategy for a new era Management Agenda Phase 4 2009 - 2011 Increase CIB profitability with Focus on core PCAM renewed risk and balance sheet businesses discipline and home market leadership Focus on Asia as a key driver Reinvigorate our of revenue growth performance culture Investor Relations
Slide 14: CIB: Significant de-risking has been achieved
CIB: Significant de-risking has been achieved … CIB U.S. GAAP ‘pro-forma’ assets, in EUR bn (37)% 1 183 1,183 1,158 858 802 751 742 2Q 3Q 4Q 1Q 2Q 3Q 2008 2009 Note: 2Q2008 does not reflect revised application of U.S. GAAP netting; values at period end; CIB U.S. GAAP ‘pro-forma’ adjustments material
Slide 15: … simultaneously with improved profitability and earnings quality …
… simultaneously with improved profitability and earnings quality … ... with substantially Return to profitability … higher return on assets CIB IBIT, in EUR bn CIB revenues(1) / total CIB assets(2), in % 6 5 4 2.6 2.0 1.7 (7) 0.3 2006 2007 2008 Jan-Sep 2006 2007 2008 Jan-Sep 2009 2009 (1) Revenues
Slide 16: … and significant share gains in a critical market
… and significant share gains in a critical market U.S. clients’ expected increase/decrease in b i business with ith leading l di investment i t t banks b k R Recent tUU.S. S market k t share h gains i Expected change in business due to the crisis 28% Pre-Crisis 4.2% 18% ECM Aft Crisis After Ci i 4.
Slide 17: GTB: Regaining momentum ...
GTB: Regaining momentum ... Income before income taxes, in EUR m Phase 4 upside: 1,106 9M Recovery of key business drivers 94 945 Market share gains 705 IInvestments t t in i 596 new products / markets 433 ABN acquisition 2009 Headwinds: Low interest rates 254 Depressed equity markets
Slide 18: … as key business drivers show signs of recovery
… as key business drivers show signs of recovery Interest rate environment remains challenging … … but asset valuations are improving 6.0% 3-months 2000 MSCI World 5.0% EURIBOR index 4 0% 4.0% 1500 3.0% 2.0% 1000 1.0% 0 0% 0.0% 500 Jan-2007 Dec-2009 Jan-2007 Dec-2009 Recovery of global trade … … as
Slide 19: PCAM: Opportunity to achieve undisputed home market leadership …
PCAM: Opportunity to achieve undisputed home market leadership … Positioning g in German market •Retail Asset Management •Private Banking •Retail Banking AuM in EUR bn, 31 Mar 2009 AuM in EUR bn, 31 Dec 2008 # of clients in million, 31 Dec 2008 ~25% 117 47 Sparkassen 50 Commerzbank(1) 45 Deka 98 Vol
Slide 20: … and to close the gap vs. large European players
… and to close the gap vs. large European players Leaders d in i European E Private Pi Banking B ki … … as well ll as R Retail il B Banking ki AuM in EUR bn, 31 Dec 2008 Domestic revenues in EUR bn, 2008 UBS 927 Intesa SanPaolo 13.2 Santander 8.7 Credit Suisse 407 Unicredit 81 8.1 HSBC 250 BBVA 7.1
Slide 21: Re-positioning Asset Management
Re-positioning Asset Management Industry challenges Performance / outflows Strategic response Margin compression, especially in institutional business Strategic partnership in insurance business Competitor moves raise important strategic questions Recalibrate remaining institutional busine
Slide 22: Continuing to increase our commitment to Asia
Continuing to increase our commitment to Asia Well-positioned today Our aspirations Bank of 2005, 2007 Net revenues Asia/Pacific excl. Japan, in EUR bn the Year 2008 FX #1 Top 3 investment ~4.0 Fixed income #1 CB&S(1) banking franchise ECM #3 +23% p.a. across the board M&A #5 Overall #
Slide 23: Our 4-pillar strategy in China provides unique optionality
Our 4-pillar strategy in China provides unique optionality O Organic i C Complementary l t strategic t t i investments i t t DB China(1) Zhong De Hua Xia Harvest Wholly-owned local 1 of 6 Sino-foreign 10th largest bank in Largest Sino-foreign Overview subsidiary securities JVs in China(3) asset mana
Slide 24: Delivering Phase 4: Creating value through inorganic growth
Delivering Phase 4: Creating value through inorganic growth Mature market consolidation Expansion in key growth markets Harvest Acquisition of <30% Acquisition of 30% HuaXia Agreement to acquire Acquisition of 17%(1) 100% Zhong De Heads of Terms for Acquisition of 33% HBU Netherlands acq
Slide 25: Re-establish a strong culture of performance and accountability
Re-establish a strong culture of performance and accountability Capitalize on our “relative winner” position to reinvigorate Performance performance f culture lt Focus on cost and improving infrastructure efficiency Implement new performance metrics and value-based Accountability management g
Slide 26: Continued focus on efficient use of capital resources
Continued focus on efficient use of capital resources – Capital demand + Capital supply Regulatory impact on RWAs Retained earnings Asset reduction initiative Organic growth Continue to reduce legacy and Level 3 assets Dividend Other de-risking efforts / RWA optimization Rating g mig
Slide 27: Initiatives underway to strengthen link between compensation and performance
Initiatives underway to strengthen link between compensation and performance Rebalancing of fixed vs. vs discretionary compensation mix Pay mix currently ongoing Deferrals in form of restricted equity and / or cash Deferrals Widely used tool to ensure alignment with long-term performance Int
Slide 28: Agenda
Agenda 1 Recent history and current context 2 Our strategy for a new era 3 Financial potential and summary Investor Relations 12/09 · 28
Slide 29: Phase 4: Assumptions for 2010 - 2011
Phase 4: Assumptions for 2010 - 2011 No further major market dislocations Normalization of asset valuations Global revenue fee pool: CAGR of 9% to a level slightly below 9M2007 Environmental annualized Margins remain higher than pre pre-crisis crisis Interest rates normalization from 2nd h
Slide 30: Phase 4: Financial potential 2011
Phase 4: Financial potential Phase 4 potential 2011 Revenue g growth p.a. p ~ 8% Performance Income before income taxes, in EUR bn(1) ~ 10.0 Return on Equity(2) 25% over the cycle Cost / income ratio ~ 65% straints Tier 1 ratio ≥10% Cons Leverage(3) ≤25x (1) Before Corporate Investments and Consolid
Slide 31: Phase 4: IBIT potential of business divisions
Phase 4: IBIT potential of business divisions in EUR bn Phase 4 potential 2011 Corporate Banking & Securities 63 6.3 Global Transaction Banking 1.3 Asset and Wealth Management 1.0 Private & Business Clients 1.5 Total business divisions 10.0 Note: Figures do not add up due to rounding differences Inv
Slide 32: Phase 4: A basis for continued outperformance
Phase 4: A basis for continued outperformance In EUR(1) Indexed, 1 Jan 2009 = 100 200 72% 160 120 13% 80 International peers(2) 40 1 Jan 28 Feb 30 Apr 30 Jun 31 Aug 31 Oct 11 Dec (1) International peers’ share prices converted into EUR based on daily FX rates (2) International peers (Citigroup, JPMo
Slide 33: In summary
In summary A relative winner – opportunity for us to take advantage Management Agenda – clear priorities and focus on performance Ambitious aspirations – we will deliver value for stakeholders Well placed to address the challenges of the new era Investor Relations 12/09 · 33
Slide 34: Appendix
Appendix \\ \ tomo: | | re [| & A Passion to Perform. Deutsche Bank
Slide 35: Reconciliation from CIB total assets (IFRS) to CIB total assets adjusted
Reconciliation from CIB total assets (IFRS) to CIB total assets adjusted (“pro-forma U.S. GAAP”) 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep In EUR bn 2007 2008 2008 2008 2008 2009 2009 2009 CIB total assets (IFRS) 1,800 2,022 1,852 1,917 2,047 1,942 1,577 1,509 Consolidation item betwee
Slide 36: 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