Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Cheuvreux 9th German Corporate Conference 2010
36 slides from Deutsche Bank's conference presentation, Jan 20, 2010
Slide 1: Deutsche Bank - Stefan Krause, Cheuvreux German Corporate Conference
Deutsche Bank Stefan Krause Chief Financial Officer Cheuvreux 9th German Corporate Conference Frankfurt, 20 January 2010
Slide 2: Agenda
Agenda 1 A clear strategy: Management Agenda Phase 4 2 Well positioned for delivery Investor Relations 01/10 · 2
Slide 3: Phase 4: Our strategy for a new era
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 R
Slide 4: 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 01/10 · 4
Slide 5: 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 01/10 · 5
Slide 6: 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 01/10 · 6
Slide 7: CIB: Profitability and balance sheet discipline
CIB: Profitability and balance sheet discipline ... 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 based on IFRS; Jan-S
Slide 8: PCAM: Opportunity for undisputed home market leadership
PCAM: Opportunity for undisputed home market leadership … Competitive p p 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 De
Slide 9: ... 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 10: Focus on Asia as a key driver of revenue growth
Focus on Asia as a key driver of revenue growth 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 11: Performance culture: Efficient use of capital resources
Performance culture: 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 m
Slide 12: Performance culture: Strengthening the link between compensation and performance
Performance culture: Strengthening the 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
Slide 13: Phase 4: Financial potential
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 14: Phase 4: IBIT potential of business divisions
Phase 4: IBIT potential of business divisions In EUR bn Phase 4 potential 2011 Corporate Banking & Securities 6.3 Global Transaction Banking 1.3 Asset and Wealth Management 1.0 Private & Business Clients 1.5 Total business divisions 10 0 10.0 Bottom up p approach pp Note: Figures do not add up due t
Slide 15: 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 16: Agenda
Agenda 1 Management Agenda Phase 4 2 Well-positioned for delivery Investor Relations 01/10 · 16
Slide 17: Significant progress in 2009 to date
Significant progress in 2009 to date 30 Sep 30 Sep 2008 2009 Income before income taxes (YTD, in EUR bn) 0.5 4.4 Profitability Net income (YTD, in EUR bn) 0.9 3.6 Pre-tax RoE (YTD, target definition)(1) (3)% 18% Tier 1 capital ratio 10.3% 11.7% Capital strength Core Tier 1 capital p ratio 7.5% 8.1%
Slide 18: CIB: Significant de-leveraging has been achieved
CIB: Significant de-leveraging 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 materia
Slide 19: Global Markets revenue outlook 2010
Global Markets revenue outlook 2010 Full year revenues including exceptional gains, 2009 reported revenues writedowns and one-off losses Normalised revenues (25)% to N Normalisation li ti off exceptionally ti ll ffavourable bl (30)% market conditions (wide spreads, trading gains) Regulatory chan
Slide 20: GTB is well-placed to regain momentum
GTB is well-placed to regain momentum Income before income taxes, in EUR m 9M 1,106 Phase 4 upside Recovery of key 945 business drivers Market share gains 705 Investments in 596 new products / markets 433 ABN acquisition 2009 Headwinds Low interest rates 254 Depressed equity markets Sl
Slide 21: Asset Management: Cost savings have created operating leverage
Asset Management: Cost savings have created operating leverage Asset Management g direct costs In EUR m 2007 Cost measures to date: 2008 EUR 350 m run run-rate rate Annualized 2009 Further run-rate savings in 2010/2011 (33)% (31)% ~ 250 m ~ 125 m Compensation and Benefits(1) Non-Comp direct costs(2)
Slide 22: PWM: Specific items absorbed in 2008/2009
PWM: Specific items absorbed in 2008/2009 Income before income taxes (IBIT), in EUR m Reported IBIT 307 Estimated severance 267 ARS/ARP 100 122(2) 129 108(1) 207 2004 2005 2006 2007 2008 2009e Illustrative (1) Reported IBIT in 2004 includes EUR 54 m from the sale of Scudder Private Investment Counci
Slide 23: PBC: Substantial efficiency initiatives already implemented
PBC: Substantial efficiency initiatives already implemented Income before income taxes Short-term outlook In EUR m Further one-off costs expected to be Severance(1) booked in 4Q2009 – Additional EUR ~65 m severance 4 payments 5 – Upfront costs for Berliner Bank 6 integration of EUR ~15 15 m 15 P
Slide 24: PBC: Expected market normalisation and initiated measures will boost the bottom line
PBC: Expected market normalisation and initiated measures will boost the bottom line Investment Products Credit Products Efficiency Revenue margin, Investment Credit revenues after risk(1), IBIT impact from efficiency products, in bps Indexed, 1Q2008 = 100 initiatives, in EUR m Charges g (2) Savings
Slide 25: Delivering on opportunities in Asia: Our 4-pillar strategy in China
Delivering on opportunities in Asia: Our 4-pillar strategy in China 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) a
Slide 26: Capital Management: We have successfully managed a huge capital demand before
Capital Management: We have successfully managed a huge capital demand before … Substantial capital demand … was met by strong 3Q2007 – 3Q2009 ... capital generation capacity In EUR bn In EUR bn Buffer to 10% 50 5.0 BIS Tier 1 ratio 6.4 ~5.0 64 6.4 4.8 23.3 18.4 3.9 6.2 4.7 3.2 1.2 Ratingg FY 2008 I
Slide 27: ... and are prepared to do so again on upcoming regulatory-driven capital demand
… and are prepared to do so again on upcoming regulatory-driven capital demand Cap Incremental capital demand by 1Q2011 covered by current capital buffer & retained earnings Capital demand based on a 10% BIS Tier 1 ratio Illustrative Current buffer, additional Capital buffer Net impact retained to 1
Slide 28: Credit Risk: Well-placed relative to peers
Credit Risk: Well-placed relative to peers LLP driven by IAS 39 – … and loan book is core portfolio intact … performing relatively well Loan loss provision, 9M2009, in EUR m Loan loss ratio(2), 9M2009, in bps PCAM 2,070 941 785 CIB/ Other Inherent IAS39 Loss(1) 674 Group 606 Inter- 457 national 88 1
Slide 29: Loan loss provision: Outlook 2010
Loan loss provision: Outlook 2010 Credit cycle likely to gradually turn; overall LLP to decline LLP forecast LLP by loan category Illustrative In bps, annualized Core portfolio IAS 39 9M2009 2010 9M2009 2010 Leveraged Finance ~75 ~1,140 Core CRE / Securitization ~465 465 ~410 CIB International ~25 ~
Slide 30: Performance culture: Cost and infrastructure efficiency
Performance culture: Cost and infrastructure efficiency DB Group headcount Efficiency aspiration FTEs 80,456 Renewed emphasis on 77,442 78,291 78,530 cost discipline and 67,682 68,849 65,417 63,427 efficiency Continued focus on employee productivity in front-office Substantial efficiency 2002
Slide 31: Performance culture: Creating value through inorganic growth
Performance culture: 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 Closing expected in Acquisition of 33% HBU Netherlands 1
Slide 32: 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 01/10 · 32
Slide 33: Appendix
Appendix \\ \ tomo: | | re [| & A Passion to Perform. Deutsche Bank
Slide 34: 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 35: Reconciliation of reported AWM IBIT
Reconciliation of reported AWM IBIT Income before income tax, in EUR m 2004 2005 2006 2007 2008 9M2009 AWM 414 597 894 913 (525) (123) AM 306 474 765 646 (732) (189) PWM 108 122 129 267 207 66 Note: Numbers for 2004 - 2005 based on U.S. GAAP and on structure as of 2006, from 2006 onwards based on IF
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
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