Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Deutsche Bank Aktiengesellschaft — Morgan Stanley European Financials Conference 2010
31 slides from Deutsche Bank's conference presentation, Mar 25, 2010
Slide 1: Deutsche Bank at Morgan Stanley European Financials Conference
Deutsche Bank Dr. Josef Ackermann Chairman of the Management Board and the Group Executive Committee Morgan Stanley European Financials Conference London, 24 March 2010
Slide 2: Agenda
1 2009: a strong base for profitable growth Agenda 2 Implementing Phase 4 of our management agenda 4 The regulatory environment: key constraints 3 Liquidity and funding: well-placed to support Phase 4
Slide 3: 2009: a strong base for profitable growth
2009: a strong base for profitable growth (1) Based on average active equity (2) Recommended (3) Total assets based on U.S. GAAP pro-forma divided by total equity per target definition Profitability Income before income taxes (FY, in EUR bn) Net income (FY, in EUR bn) Pre-tax RoE (FY, target definit
Slide 4: Revenues and profits close to pre-crisis record levels
Revenues and profits close to pre-crisis record levels ... In EUR bn Net revenues Net income '03 '04 '05 '06 '07 '08 '09 Mark-downs Net revenues '03 '04 '05 '06 '07 '08 '09 (1) Includes significant property impairment of EUR 0.5 bn for 1Q2009 and of EUR 0.1 bn for 4Q2009; 2003-2005 based on U.S. GAA
Slide 5: Simultaneously with significant leverage reduction
.... simultaneously with significant leverage reduction ... Assets Leverage ratio(1) (CHART) 1Q 2Q 3Q 4Q 2008 (CHART) U.S. GAAP pro-forma, in EUR bn 1Q 2Q 3Q 4Q 2009 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q (541) (14)x 2008 2009 (1) Total assets based on U.S. GAAP pro-forma divided by total equity per target definit
Slide 6: Our strongest capital ratios ever
.... and our strongest capital ratios ever RWA, in EUR bn Tier 1 ratio, in % Core Tier 1 ratio, in % 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 12.6 (43) Tier 1 capital, in EUR bn 32.8 28.3 32.3 31.1 27.9 32.5 33.7 8.7 Target: ^10% 2008 2009 Note: Core Tier 1 ratio = Tier 1 capital less hybrid Tier 1 capital divided b
Slide 7: Well placed to deliver on Phase 4
Well placed to deliver on Phase 4 Focus on core PCAM businesses and home market leadership Increase CIB profitability with renewed risk and balance sheet discipline Focus on Asia as a key driver of revenue growth Reinvigorate our performance culture Management Agenda Phase 4 2009 - 2011
Slide 8: Agenda
Agenda 1 2009: a strong base for profitable growth 2 Implementing Phase 4 of our management agenda 2011 potential in our core businesses Re-invigorating our performance culture 4 The regulatory environment: key constraints 3 Liquidity and funding: well-placed to support Phase 4
Slide 9: Phase 4: financial potential
(1) Before Corporate Investments and Consolidations & Adjustments (2) Pre-tax return on Average Active Equity (3) Per target definition: Assets based on U.S.GAAP 'pro-forma'; total equity adjusted for FV gains / losses on DB issued debt Revenue growth p.a. Income before income taxes, in EUR bn(1) Re
Slide 10: 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 annualized Margins remain higher than pre-crisis Interest rates normalization from 2nd half 2010 Global GDP growth ^ 2% p.a. over the period Environmental Deuts
Slide 11: Phase 4: clear profit targets for all businesses
Phase 4: clear profit targets for all businesses Asset and Wealth Management (AWM) Private & Business Clients (PBC) Corporate Banking & Securities (CB&S) Global Transaction Bank (GTB) Total business divisions Income before income taxes, in EUR bn 0.2 0.5 3.5 0.8 5.0 1.0 1.5 6.3 1.3 10.0 7.4 0.8 1.1
Slide 12: 2011 potential: CB&S / Global Markets
2009 IBIT 2009 adjusted 2011 potential IBIT Equities Debt / other products Additional staff costs incl. deferrals Potential write- downs(1) Income before income taxes, in EUR bn 2011 potential: CB&S / Global Markets U.S. cash Liquid/flow derivatives Asia cash Prime Brokerage Commodities build EM deb
Slide 13: 2011 potential: CB&S / Corporate Finance
2011 potential: CB&S / Corporate Finance Income before income taxes, in EUR bn 2009 IBIT Specific items Market normali- sation 2009 before specific items Target fee pool growth Share capture Invest- ment hiring Additional staff costs incl. deferrals 2011 potential IBIT Credit spreads tightening Lowe
Slide 14: 2011 potential: Global Transaction Banking
2009 reported IBIT Solutions Clients 2011 potential IBIT Markets Growth related investment costs Additional risk costs(2) Income before income taxes, in EUR bn 2011 potential: Global Transaction Banking Improved interest rates Cost development ~(0.5) Revenue development ~1.1 Risk development ~(0.0)
Slide 15: 2011 potential: Asset Management
2011 potential: Asset Management Income before income taxes, in EUR m Note: Figures do not add up due to rounding differences; column size is illustrative 2009 reported IBIT Specific items 2009 before specific items Cost savings run rate Market normali- sation IT/Ops/ Real Estate rationali- zation S
Slide 16: 2011 potential: Private Wealth Management
Note: Figures do not add up due to rounding differences; column size is illustrative 2009 reported IBIT 2009 specific items 2009 before specific items Cost base reduction Emerging market UHNW pro- position Lending Product initiatives 2011 potential IBIT On-shore market growth Double-size Asia GB/GM
Slide 17: Sal. Oppenheim: dedicated strategy for each business activity
Sal. Oppenheim: dedicated strategy for each business activity Wealth Management Asset Management Corporate Banking/ Financial Markets/ Other Cluster 1 Wealth Management Germany Asset Management Germany/Lux IB (incl. attributable overhead/IT) Other (BAS, SGG, Alternative investments, etc.) SOPEP Clus
Slide 18: Asset base has remained stable
1 Asset base has remained stable In EUR bn (1) Assets, deposits, Esch investment volume and other, AuC of Sal. Opp., excl. loans, AuC of BHF Adjusted values for DB definition of Invested Assets: Dec 2008: EUR 100.9 bn; Dec 2009: EUR 103.3 bn (2) Excludes OVAM (Oppenheim VAM Kapitalanlagegesellschaft
Slide 19: 2011 potential: Private & Business Clients
2009 reported IBIT Specific items 2009 before specific items Sales initiatives Germany Europe Efficiency initiatives(2) Infra- structure platform efficiency Change in LLPs (1) Mainly Asset Liability Management (2) Reduces also risk costs Note: Figures may not add up due to rounding differences; colu
Slide 20: Agenda
Agenda 1 2009: a strong base for profitable growth 2 Implementing Phase 4 of our management agenda 2011 potential in our core businesses Re-invigorating our performance culture 4 The regulatory environment: key constraints 3 Liquidity and funding: well-placed to support Phase 4
Slide 21: Performance culture: cost and infrastructure efficiency
DB Group headcount Efficiency aspiration FTE, at period end 79 82 80 75 70 70 134 72 Cost/income ratio, in %: Performance culture: cost and infrastructure efficiency 65 Target: Note: 2002 - 2005 based on U.S. GAAP, since 2006 based on IFRS Renewed emphasis on cost discipline and efficiency Continued
Slide 22: Cost and infrastructure efficiency: examples of initiatives
Function / area Key levers Technology / IT Functional alignment of IT operating model: Elimination of duplication Functional integration and standardisation of processes (app. dev., production mgt.) Maximising value from of vendor management and outsourcing Maximum benefit of low-cost locations Plat
Slide 23: Agenda
1 2009: a strong base for profitable growth Agenda 2 Implementing Phase 4 of our management agenda 3 Liquidity and funding: well-placed to support Phase 4 4 The regulatory environment: key constraints
Slide 24: Modest reliance on short-term wholesale funding
Modest reliance on short-term wholesale funding In EUR bn Funding sources overview Liquidity position Reduced funding demand following asset reductions Conservative funding mix maintained Available cash and strategic liquidity reserve exceed net funding gap under combined idiosyncratic / market stre
Slide 25: Timely and well-priced funding through the crisis
Timely and well-priced funding through the crisis ... 0 50 100 150 200 250 300 350 0 50 100 150 200 250 300 350 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Bps over Euribor / Libor Deutsche Bank Deutsche Bank European Peer European Peer US Peer US Peer European Peer
Slide 26: And strong liquidity positions
3yr 4yr 5yr 6yr 7yr 2yr 8yr 9yr 10yr .... and strong liquidity positions Liquidity profile Strategic liquidity reserve As of December 2009, in EUR bn End 2007 - 2009, in EUR bn Avoidance of mismatches Net long-funded across all term buckets Significant increase in liquidity reserve Additional buffer
Slide 27: Agenda
1 2009: a strong base for profitable growth Agenda 2 Implementing Phase 4 of our management agenda 3 Liquidity and funding: well-placed to support Phase 4 4 The regulatory environment: key constraints
Slide 28: The changing environment: capital
The changing environment: capital Stressed Value-at-Risk Incremental risk charge Trading book securitization Correlation trading Capital demand / supply, 3Q2007 - 4Q2009 Key components Buffer to 10% BIS Tier 1 ratio Rating migra- tion FY2008 net loss Increase of Tier 1 target to 10% Other Total Tota
Slide 29: The changing environment: additional issues
The changing environment: additional issues Consultation phase Proposal / discussion phase Basel Committee consultative document Capital / capital eligibility Leverage Liquidity Counterparty credit risk Countercyclical capital buffers Timeline for implementation National capital requirements Structu
Slide 30: Key takeaways
Well-capitalized Strong liquidity / funding Clear achievable goals Significant capital buffer Future retained earnings potential Fresh capital for buying new earnings streams (only) Key takeaways In all aspects: positioned to deliver on Phase 4 Substantial liquidity reserve Net long - funded in all
Slide 31: 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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