Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Barclays Yankee Financials Credit Forum 2024
44 slides from Deutsche Bank's conference presentation, Sep 11, 2024
Slide 1: Update on Deutsche Bank @ Barclays Yankee Financials Credit Forum
Deutsche Bank Investor Relations Update on Deutsche Bank @ Barclays Yankee Financials Credit Forum Richard Stewart – Group Treasurer Silke-Nicole Szypa – Deputy Head of IR New York City September 11, 2024
Slide 2: Strong business performance supports path to targets
Strong business performance supports path to targets H1 2024 Robust franchise momentum, with H1 revenues on track towards € 30bn full-year target € 15.4bn Revenues 12% year-on-year growth in commissions and fee income, with all businesses contributing and reflecting investments in strategic grow
Slide 3: 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 € 1.5bn delivered or expected savings 5.7% revenue CAGR1 in Q2 2024 LTM from execu
Slide 4: Revenue performance has exceeded expectations
Revenue performance has exceeded expectations In € bn, unless stated otherwise Operating business revenue development Corporate Bank Private Bank Asset Management Investment Bank 5.7% revenue CAGR in Q2 2024 LTM vs. FY 2021, within the raised target 28.8 29.3 range, reflecting the benefit of complem
Slide 5: Consistently growing underlying profit
Consistently growing underlying profit In € bn, unless stated otherwise Pre-provision profit Substantially increased pre-provision profit since the launch of Global 7.9 Hausbank strategy at the beginning of 2022 7.2 1.3 6.8 Postbank provision Underlying pre-provision profit growth, driven by revenue
Slide 6: Cost/income ratio (CIR) improving towards target
Cost/income ratio (CIR) improving towards target Group CIR development Significantly reduced costs, while self-funding transformation and platform 88% investments to support fee generation across divisions 85% 78% 75% 75% Strong cost discipline across all businesses and infrastructure 69% ex-Postban
Slide 7: Corporate Bank
Corporate Bank In € m, unless stated otherwise Financial results Revenue performance Key highlights Δ vs. Δ vs. Δ vs. Q2 Q2 2024 Q2 2023 Q1 2024 2023 Statement of income Corporate Revenues essentially flat year on year and up Treasury Services Revenues 1,922 (1)% 2% 1,058 (2)% (2)% sequentially, d
Slide 8: Investment Bank
Investment Bank In € m, unless stated otherwise Financial results Revenue performance Key highlights Δ vs. Δ vs. Δ vs. Q2 Q2 2024 Q2 2023 Q1 2024 Higher revenues year on year driven by ongoing 2023 recovery in O&A, with FIC essentially flat and client Fixed Income & Currencies Statement of income
Slide 9: Private Bank
Private Bank In € m, unless stated otherwise Financial results Revenue and AuM performance Key highlights Δ vs. Δ vs. Revenues Δ vs. Q2 Q2 2024 Q2 2023 Q1 2024 2023 Revenues essentially flat quarter on quarter with higher investment product revenues offset by Personal Banking Statement of income 1
Slide 10: Asset Management
Asset Management In € m, unless stated otherwise Financial results Revenue and AuM performance Key highlights Δ vs. Δ vs. Revenues Δ vs. Q2 Q2 2024 Q2 2023 Q1 2024 2023 trans. Mgmt. Other fees fees Statement of income 613 6% Revenues 663 7% 7% Significant improvement in profit before tax, up Perf.
Slide 11: Treasury topics
Treasury topics Deutsche Bank. Investor Relations 10
Slide 12: Conservatively managed balance sheet
Conservatively managed balance sheet Net1, in € bn, as of June 30, 2024 High-quality loan portfolio Assets Liabilities & Equity Stable funding mix 1,053 1,053 Investment grade Weighted-average life 71% Corporate Bank exposure2 160 Trading and related liabilities5 7y in long-term debt portfolio HQLA4
Slide 13: Steady deposit growth over last four quarters
Steady deposit growth over last four quarters In € bn, unless stated otherwise Loan development1,2 Key highlights QoQ YoY 482 485 479 480 482 0% (1)% Loans remained stable during the quarter adjusted for FX: Investment Bank 103 103 101 103 106 2% 2% Good momentum in FIC Financing Stable loans
Slide 14: Net interest income expected to outperform prior guidance
Net interest income expected to outperform prior guidance In € bn, unless stated otherwise Group development Key banking book segment1 development 1.5% 1.4% 1.3% 1.3% 1.2% 4.2% 3.9% 4.1% 4.2% 4.1% Corporate Bank 3.6 0.3 3.3 3.2 3.1 3.0 1.3 1.2 1.3 1.3 1.3 0.1 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024
Slide 15: CET1 ratio remains stable
CET1 ratio remains stable As of June 30, 2024, period end CET1 ratio, movements in basis points (bps) Key highlights 6 13.5% CET1 ratio up slightly compared to Q1 2024: 4 6bps from CET1 capital reflecting lower regulatory 13.4% adjustments with strong Q2 2024 earnings were offset by (4) Postbank
Slide 16: Capital ratios well above regulatory requirements
Capital ratios well above regulatory requirements As of June 30, 2024, in % of RWA, unless stated otherwise Key highlights 18.6 T2 2.4 279bps 15.8 Buffer to CET1 requirement of 231bps (equivalent to € AT1 2.8 2.7 T2 requirement4 8bn), broadly unchanged: 6bps increase in the CET1 ratio 231bps 2.0
Slide 17: Leverage ratio increase led by AT1 issuance
Leverage ratio increase led by AT1 issuance As of June 30, 2024, movement in bps, unless stated otherwise Key highlights 14 4.6% 4.5% 1 (2) 3.85% 0.75% G-SIB 0.10% Pillar 2 requirement Pillar 1 3.00% requirement Leverage ratio up by 13bps compared to Q1 2024: 14bps Tier 1 capital change, princip
Slide 18: Significant buffer over MREL/TLAC requirements
Significant buffer over MREL/TLAC requirements As of June 30, 2024, loss-absorbing capacity, in € bn unless stated otherwise Key highlights 127 Senior preferred1 14 17 Surplus 25 28 above Senior requirements Q2 2024 loss-absorbing capacity significantly above all non-preferred 46 regulatory requir
Slide 19: 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 134% 136% 131% 136% 131% Daily average LCR at 131% in line with targeted level LCR 137% 132% 140% 136% 136% ~130% Spot LCR stable a
Slide 20: Issuance plan well advanced
Issuance plan well advanced In € bn, unless stated otherwise Key highlights Covered bonds Senior preferred2 Senior non-preferred AT1/T2 24 4 17 17 16 13-18 1 7 1 1 DB’s credit spreads continued to develop constructively 4 3 13 throughout Q2, leading to a YTD tightening of senior 6 7 6-8 non-prefer
Slide 21: Path to 2025 targets
Path to 2025 targets Deutsche Bank. Investor Relations Barclays Yankee Financial Credit Forum 20 September 11, 2024
Slide 22: On track to reach revenue growth target of 5.5-6.5%
On track to reach revenue growth target of 5.5-6.5% In € bn, unless stated otherwise Revenues Notable franchise achievements in H1 2024 driving revenue momentum 12% Strong momentum in commissions and fee income generating businesses across all Corporate regions + Bank World’s Best Bank for Corpo
Slide 23: Reinforced cost execution supports operating leverage
Reinforced cost execution supports operating leverage In € bn, unless stated otherwise Noninterest expenses Improving operational efficiency 75.1 Cost/income ratio, in % <62.5 21.7 Focused expense management has delivered lower adjusted costs of € 5.0bn in Q2 2024, in line with guidance (0.7) (0.4)
Slide 24: 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, Aim to operate
Slide 25: Appendix
Appendix Deutsche Bank. Investor Relations Barclays Yankee Financial Credit Forum 24 September 11, 2024
Slide 26: 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 Q2 2024 provisions slightly higher sequentially due to higher Stage 1+2 charges resulting from net effect of 488 overlays and models enhancements, part
Slide 27: Highly diversified loan book
Highly diversified loan book Q2 2024, IFRS loans: € 482bn1 Key highlights Other2 Other IB3 German Mortgages and Leveraged Debt 0% Home Loans & Savings Capital Markets 11% Credit portfolio quality remains solid despite macroeconomic and geopolitical uncertainties 1% Asset Backed Securities 6% 31% IB
Slide 28: Commercial Real Estate (CRE) 1 / 2
Commercial Real Estate (CRE) 1 / 2 CRE non-recourse portfolio: € 38bn € 31bn in scope of severe stress test2 Non-recourse € 38bn – 8% of total loans1 By region By region APAC APAC € 7bn deemed as lower risk, includes data centers EU and municipal social housing 7% 16% 1% CRE higher risk loans
Slide 29: Commercial Real Estate (CRE) 2 / 2
Commercial Real Estate (CRE) 2 / 2 US CRE in scope of severe stress test1: € 16bn US CRE loan risk management US CRE CLPs By type Office: € 7bn Modified loans, in € bn CLPs per quarter, in € m 12 130 Other 123 121 Other New York 17% 27% Office Miami 29% Philadelphia 3% 3% 74 45% 5% 5.3% 66 Boston Re
Slide 30: Leverage exposure and risk-weighted assets
Leverage exposure and risk-weighted assets CRD4, in € bn, period end Leverage exposure Risk-weighted assets 356 356 59 Operational risk RWA 59 1,254 1,262 Market risk RWA Trading assets 133 126 29 22 Credit valuation 4 128 17 adjustments Derivatives1 136 Lending 468 469 149 Lending commitments2 Cred
Slide 31: Current ratings
Current ratings As of September 10, 2024 Moody‘s Investors Morningstar 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-pref
Slide 32: Capital markets issuance outstanding
Capital markets issuance outstanding As of June 30, 2024, in € bn By product1 By currency1 Other Capital GBP Instruments 7 (AT1/T2) 4 23 Senior 52 non-preferred Covered bonds 15 118 118 64 EUR USD 43 13 Senior structured 15 Senior preferred Notes: for footnotes refer to slides 40-42 Deutsche Bank. I
Slide 33: Diversified deposit base
Diversified deposit base As of June 30, 2024 By business By product Investment Bank & Term deposits Institutional Treasury Term deposits other Client Services Personal CB 4% 4% 12% Banking 14% 30% Private Bank 39% Retail € 641bn Non-operational 14% € 641bn overnight Corporate 29% Treasury 19% 12% Se
Slide 34: Net interest income (NII) sensitivity
Net interest income (NII) sensitivity Hypothetical +/-25bps shift in yield curve, in € m Net interest income (NII) sensitivity1 +25bps shift in yield curve -25bps shift in yield curve ~140 ~70 ~25 ~(35) ~(75) ~(145) 2025 2026 2027 Breakdown of sensitivity by currency for +25bps shift in yield curve
Slide 35: Derivatives bridge
Derivatives bridge Q2 2024, IFRS derivative trading assets and the impact of netting and collateral, in € bn Key highlights 237 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 36: Level 3 assets and liabilities
Level 3 assets and liabilities As of June 30, 2024, in € bn Assets: € 25bn Liabilities: € 12bn Key highlights Other Other 0 Derivative Liabilities Level 3 is an indicator of valuation uncertainty 3 Derivative and not of asset quality Debt 8 Assets Debt Securities 4 securities 5 The Group classif
Slide 37: Litigation update
Litigation update In € bn, period end Litigation provisions Key highlights Quarter-on-quarter increase in provisions and decrease 2.7 in contingent liabilities mainly driven by Postbank takeover litigation, where the bank recorded a provision 1.5 1.6 in Q2 2024 and cancelled the formerly existing
Slide 38: 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 June 30, 2024, in € m, 99% confidence level Trading P&L1, VaR sVaR 400 160 300 174 162 172 200 120 121 100 80 0 44 34 34 -100 40 33 -200 0 -300 -400 (40) -500 (80) Q3 2023 Q4 20232 Q1 2024 Q2 2024 -600 1-d
Slide 39: Corporate & Other
Corporate & Other In € m, unless stated otherwise Financial results Profit (loss) before tax Key highlights Δ vs. Δ vs. Abs. Δ vs. Q2 2024 Q2 2023 Q1 2024 Q2 2023 Statement of income Funding & Loss before tax of € 1.5bn, compared to a loss Revenues 73 (15)% n.m. liquidity (46) (37) before tax of €
Slide 40: 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 Revenues excluding the business and are likely to distort an accurate assessment of the
Slide 41: Footnotes 1 / 3
Footnotes 1 / 3 Slide 1 – Strong business performance supports path to targets Slide 8 – Private Bank 1. Defined on slide 24 and detailed on slide 25 1. Detailed on slide 25-26 2. Throughout this presentation post-tax return on average tangible shareholders’ equity (RoTE) is calculated on 2. Include
Slide 42: Footnotes 2 / 3
Footnotes 2 / 3 Slide 13 – Net interest income expected to outperform prior guidance Slide 19 – Issuance plan well advanced 1. Defined on slide 31 1. Historical redemptions include non-contractual outflows (e.g. calls, knock-outs, buybacks) whereas (future) 2. Includes NII from Treasury funding and
Slide 43: Footnotes 3 / 3
Footnotes 3 / 3 Slide 30 – Current ratings 1. The Issuer Credit Rating (ICR) is S&P‘s view on an obligor‘s overall creditworthiness; it does not apply to any specific financial obligation, as it does not take into account the nature of and provisions of the obligation, its standing in bankruptcy or
Slide 44: 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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