Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Deutsche Bank Aktiengesellschaft — Morgan Stanley European Banks & Financials Conference 2008
29 slides from Deutsche Bank's conference presentation, Apr 3, 2008
Slide 1: Morgan Stanley European Banks & Financials Conference
Morgan Stanley European Banks & Financials Conference London, 1 April 2008 Deutsche Bank Dr. Josef Ackermann Chairman of the Management Board
Slide 2: Agenda
Agenda 1 2007: Solid performance in challenging markets 2 Transparency on key exposures 3 Strategic consistency
Slide 3: A year of solid performance in challenging times
2006 2007 PBC 8.3 8.7 3.5 5.9 2006 2007 6.1 6.5 A year of solid performance in challenging times Revenues Profit 2006 2007 Revenues 28.5 30.7 In EUR bn 8% Income before income taxes Net income 7% 5%
Slide 4: Five-year profit growth in our core businesses
Five-year profit growth in our core businesses PCAM CIB 2003 2004 2005 2006 2007 Income before income taxes, in EUR bn 2003 2004 2005 2006 2007 10% p.a. 15% p.a. Note: 2003-2005 based on U.S. GAAP, 2003 based on structure as of 2005, 2004-2005 based on structure of 2006; 2006 onwards based on IFRS a
Slide 5: Continued leadership in investment banking
Goldman Sachs* DB JPMorgan Chase Credit Suisse Lehman Brothers* Morgan Stanley* Citi UBS Merrill Lynch S&T 20.181 13.02 7.565 9.137 9.011 6.355 2.859 -0.194 -1.147 IB 5.526 2.664 4.81 3.379 2.863 4.051 LP 0.974 3.929 Total 25.707 16.507 16.304 12.253 11.9 10.406 2.859 -0.194 -1.147 Continued leaders
Slide 6: A major global asset gatherer
AM PWM PBC 27 40 27 13 19 59 Net new money AM PWM PBC PCAM Invested assets Private Banking and others Asset Mgmt. In EUR bn A major global asset gatherer (1) Total Private Client Assets and 50% of BlackRock invested assets (2) Excluding PBC equivalent (DB invested assets comparable data not availabl
Slide 7: A year of substantial capital formation
Total shareholders' equity Book value per share* 2007 2006 2007 2006 In EUR bn In EUR A year of substantial capital formation * Book value per share is defined as shareholders' equity divided by the number of basic shares outstanding (both at period end) 2007 2006 Tier 1 capital In EUR bn 2006 2007
Slide 8: Delivery on targets
2003 2004 2005 2006 2007 2003 2004 2005 2006 2007 2.31 2.85 4.07 FY 2.31 4.53 6.95 11.48 13.05 2003 2004 2005 2006 2007 RoE 26 2003 2004 2005 2006 2007 RoE 10 16 24 33 29 Delivery on targets Diluted EPS Pre-tax RoE In % Note: 2003-2005 based on U.S. GAAP, 2006 onwards based on IFRS In EUR 2004 2005
Slide 9: Maintaining an attractive dividend policy
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Dividend per share 0.92 1.12 1.15 1.3 1.3 1.3 1.5 1.7 2.5 4 4.5 Maintaining an attractive dividend policy 2003 2004 2005 2006 Dividend per share, in EUR 2007 Recommended 3x
Slide 10: Agenda
Agenda 1 2007: Solid performance in challenging markets 2 Transparency on key exposures 3 Strategic consistency
Slide 11: Our valuation approach
Our valuation approach Assets Commercial Real Estate Leveraged Finance Collateralized Debt Obligations U.S. Mortgage Business Almost 100% of all assets held in the trading book All of them are marked-to-market Continued to apply accounting and valuation principals consistently with prior periods Fai
Slide 12: Sub-prime exposure
Sub-prime exposure Gross Hedges Net exposures Net exposures Other Net sub-prime exposure 1.02 1.02 1004 2.9 2.1 0.186 1.2 186 0.216 1190 3.08 In EUR bn Gross exposure Hedges* Net exposure * Tranched CDO protection including additional index-based hedges, sub-prime component segregated according to r
Slide 13: Non sub-prime exposure in our RMBS business
Non sub-prime exposure in our RMBS business Exposure As at 31 Dec 2007 * The vast majority of these hedges relates to Alt-A exposures; hedges consist of single name CDSs, index hedges and protection bought from monoline insurers Source: 20-F 2007, page 73 Note: Figures may not add up due to rounding
Slide 14: Monoline exposure
Monoline exposure In EUR bn Exposure * Other exposure from client activity Source: 20-F 2007, page 73-74 Note: Figures may not add up due to rounding differences Exposure to U.S. residential mortgage EUR 1.1 bn Additional net counterparty exposure to monoline insurers of EUR 1.2 bn From client activ
Slide 15: Commercial Real Estate exposure
Funded Unfunded Total 15999 15999 1166 8366 6873 1926 17165 Commercial Real Estate exposure In EUR bn Trading whole loan exposure Funded Unfunded North America Germany Total commitments Source: 20-F 2007, page 74 Note: Figures may not add up due to rounding differences Other Europe CRE overall profi
Slide 16: Leveraged Finance exposure
Leveraged Finance exposure Funded Unfunded Total 15317 15317 20897 26620 8959 635 36214 In EUR bn Funded Unfunded Total commitments Leveraged finance exposure* North America Europe Asia/ Pacific * Leveraged loan and other financing commitments from our leveraged finance business Source: 20-F 2007, p
Slide 17: Agenda
Agenda 1 2007: Solid performance in challenging markets 2 Transparency on key exposures 3 Strategic consistency
Slide 18: Strategy: We stay the course
Strategy: We stay the course Management Agenda Phase 3 Build on our competitive edge in CIB Continue to invest in organic growth and 'bolt-on' acquisitions Further grow our 'stable' businesses in PCAM and GTB Maintain our cost, risk, capital and regulatory discipline 2006 - 2008: Leveraging our glob
Slide 19: We maintained cost, risk, capital and regulatory discipline
We maintained cost, risk, capital and regulatory discipline Cost Risk Capital (1) Problem loans divided by total loans, at period end (2) Basel I, at period end (3) On industrial holdings, at period end Note: 2003 - 2005 based on U.S. GAAP, 2006 onwards based on IFRS Cost / income ratio, in % Proble
Slide 20: A funding cost advantage for Deutsche Bank
DB JPM CS UBS GS MS Citi MER LEH 7/1/2007 14.231 19.33 17.55 10.375 34.938 35 11.667 35.225 37.338 3/18/2008 86.488 111.791 113.383 132.754 150.231 172.339 182.649 265.107 289.95 A funding cost advantage for Deutsche Bank 28 March 2008 1 July 2007 5-year senior CDS, in bps Source: Bloomberg JPMorgan
Slide 21: Investing in growth by financing RWA increase ...
Investing in growth by financing RWA increase ... 2002 2003 2004 2005 2006 2007 Ost 237 216 217 251 275 328 Return on RWA* (in %) 2.9 1.6 1.8 2.5 3.2 x.x * 2003-2005: Underlying pre-tax profit in % of average RWAs; 2003-2005 RWA based on U.S. GAAP; 2006-2007: Income before income taxes in % of avera
Slide 22: .... and expanding our global platform
.... and expanding our global platform Acquisitions, partnerships and organic investments 2007 / 08 Stake in Aldus Equity Commodities platform HedgeWorks USA Abbey Life portfolio Tilney integration UK Increased stakes in Hua Xia and Harvest Fund Management Local incorporation of Deutsche Bank (China
Slide 23: Strong geographical diversification
1995 2006 2007 Germany 7 7.187 8.434 RoEurope 2 9.497 10.537 Americas 0.7 8.16 5.959 Asia/Pacific 0.4 3.273 4.291 Net revenues(1) Income before income taxes(2) Strong geographical diversification Germany EMEA (excl. Germany) Americas Asia / Pacific Total 1995 2007 EUR 10 bn EUR 31 bn FY2007 Asia / P
Slide 24: Further growing our 'stable' businesses
2002 2003* 2004 2005 2006 2007 PBC 0.458 0.971 0.887 1.041 1.146 AWM 0.647 0.414 0.597 0.895 0.913 GTB 0.228 0.254 0.433 0.705 0.945 Total 1.4 1.6 1.9 2.6 3 * GTB adjusted for gain on sale of GSS Note: 2003-2005 based on U.S. GAAP, 2003 based on structure as of 2005, 2004-2005 based on structure of
Slide 25: .... with strong net new money inflows
2002 2003* 2004* 2005 2006 2007 YTD PBC -43 -41 7 28 59 PWM AM -43 -41 7 28 59 * PWM not restated for Rud Blass .... with strong net new money inflows PCAM, in EUR bn 2003* 2004 2005 2006 2007
Slide 26: Building on competitive edge in investment banking
Building on competitive edge in investment banking Sustained momentum in CB&S 2003 2004 2005 2006 2007 CB&S rev 11.796 11.521 13.948 16.574 16.507 Net revenues, in EUR bn Management stability Tight risk and capital management Diversification by product, region and client type Strong global network /
Slide 27: Deutsche Bank's focus in a challenging near-term environment
Deutsche Bank's focus in a challenging near-term environment Material change in environment since July 2007 Conditions likely to remain uncertain in 2008 Focus: Gain market share Well-positioned in growth regions Sensitivity to interest rates Focus: Operating leverage Leverage investments and capita
Slide 28: Longer-term trends continue to favour Deutsche Bank
Longer-term trends continue to favour Deutsche Bank Growth of emerging markets Geographical boundaries disappear Global players act locally Growing investor appetite Innovation / structuring Corporate activity Leverage / risk distribution Private retirement funding Emerging market wealth creation Sh
Slide 29: Cautionary statements
Cautionary statements This presentation also 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 an
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