Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Q1 2010 Earnings Presentation
56 slides from Deutsche Bank's earnings presentation, Apr 27, 2010
Slide 1: 1Q2010 Results
Deutsche Bank 1Q2010 Results Stefan Krause Chief Financial Officer Analyst Call, 27 April 2010 Deutsche Bank 1Q2010 results financial transparency. Investor Relations Stefan Krause, CFO
Slide 2: Agenda
Agenda 1 Group results 2 Segment results 3 Key current issues Deutsche Bank 1Q2010 results financial transparency. 2 Investor Relations Stefan Krause, CFO
Slide 3: Highlights
Highlights 1Q2009 1Q2010 Income before income taxes (in EUR bn) 1.8 2.8 Profitability Net income (in EUR bn) 1.2 1.8 Pre-tax RoE (target definition)(1) 25% 30% 31 Dec 31 Mar 2009 2010 Tier 1 capital ratio 12.6% 11.2% Capital Core Tier 1 capital ratio 8.7% 7.5% Tier 1 capital (in EUR bn) 34.4 32.8 To
Slide 4: The first quarter in historic context
The first quarter in historic context In EUR bn Net revenues Income before income taxes 9.6 9.0 3.2 8.0 2.8 2.6 7.2 6.6 6.2 1.8 1.8 1.6 5.0 4.6 0.2 (0.3) ‗03 ‗04 ‗05 ‗06 ‗07 ‗08 ‗09 ‗10 ‗03 ‗04 ‗05 ‗06 ‗07 ‗08 ‗09 ‗10 1Q 1Q Note: 2003-2005 based on U.S. GAAP reported figures, 2006 onwards based on I
Slide 5: Net revenues
Net revenues In EUR bn Significant property impairment Mark-downs 0.2 0.5 0.0 1.0 0.1 0.2 9.0 7.2 7.9 7.2 (1), (2) 5.5 1Q 2Q 3Q 4Q 1Q 2009 2010 (1) Includes net mark-ups of EUR 319 m (mainly monolines) (2) Includes net effect of charges related to Ocala Funding LLC of approx. EUR 350 m and losses re
Slide 6: Provision for credit losses
Provision for credit losses In EUR m Related to IAS 39 reclassified assets (50)% 1,000 526 544 560 262 492 308 329 249 159 1Q 2Q 3Q 4Q 1Q 2009 2010 Thereof: CIB 357 0 779 0 323 0 357 0 90 0 169 221 214 201 173 Thereof: PCAM Note: Divisional figures do not add up due to omission of Corporate Investme
Slide 7: Noninterest expenses
Noninterest expenses In EUR bn Compensation and benefits General and administrative expenses Other non-comp expenses(1) 5.9 5.6 5.4 In EUR m 4.9 Higher deferred 4.2 compensation ~ 350 3.1 2.8 UK payroll tax 120 3.6 3.0 Sal. Oppenheim 90 2.4 2.2 In EUR m 2.2 2.2 Sal. Oppenheim 95 2.0 2.0 (0.1
Slide 8: Amortization of deferred compensation
Amortization of deferred compensation In EUR m Key features — Change of compensation 2,063 CB&S 230 model resulted in higher 1Q2010 298 deferred compensation GTB 20 amortization 178 — Acceleration of equity AM 29 compensation expenses for 2Q-4Q2010 PWM 12 employees eligible for career amortization 7
Slide 9: Income before income taxes
Income before income taxes In EUR bn 54% 2.8 1.8 1.3 1.3 0.8 1Q 2Q 3Q 4Q 1Q 2009 2010 Pre-tax return on equity(1), in % 22 15 15 9 30 (1) Annualised, based on average active equity Deutsche Bank 1Q2010 results financial transparency. 9 Investor Relations Stefan Krause, CFO
Slide 10: Net income
Net income In EUR bn 50% 1.8 1.4 1.3 1.2 1.1 1Q 2Q 3Q 4Q 1Q 2009 2010 Effective tax rate, in % 35 18 (6) (73) 36 Deutsche Bank 1Q2010 results financial transparency. 10 Investor Relations Stefan Krause, CFO
Slide 11: Capital ratios and risk-weighted assets
Capital ratios and risk-weighted assets Tier 1 ratio: (117) bps(1) 12.6 11.7 11.2 11.0 11.2 10.2 Target: ≥10% 8.7 7.8 8.1 7.5 7.1 7.5 RWA: EUR 17 bn 316 295 288 292 273 1Q 2Q 3Q 4Q 1Q 2009 2010 Tier 1 ratio, in % Core Tier 1 ratio, in % RWA, in EUR bn Sal. Oppenheim Group impact Note: Core Tier 1 ra
Slide 12: Development of total assets
Development of total assets In EUR bn 31 Dec 2009 31 Mar 2010 Leverage ratio(2) Target: ≤25x 1,501 1,670 23 23 891 978 (609) (692) IFRS Netting(1) U.S. IFRS Netting(1) U.S. 31 Dec 31 Mar GAAP GAAP 2009 2010 pro-forma pro-forma Note: Figures may not add up due to rounding differences (1) For 31 Mar 1
Slide 13: Agenda
Agenda 1 Group results 2 Segment results 3 Key current issues Deutsche Bank 1Q2010 results financial transparency. 13 Investor Relations Stefan Krause, CFO
Slide 14: Segment overview
Segment overview Income before income taxes, in EUR m 1Q2010 1Q2009 2,589 CB&S 1,318 119 GTB 227 (5) AWM (173) 189 PBC 206 65 CI 65 (165) C&A 173 Deutsche Bank 1Q2010 results financial transparency. 14 Investor Relations Stefan Krause, CFO
Slide 15: CB&S: P&L at a glance
CB&S: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 5,992 4,255 2,861 41% 109% Provision for credit losses (93) (356) (345) (74)% (73)% Noninterest expenses (3,295) (2,581) (2,123) 28% 55% Income before income taxes 2,589 1,318 398 96% n.m. CIR 55% 61
Slide 16: Sales & Trading revenues
Sales & Trading revenues In EUR bn Specific item Mark-downs Net revenues 0.3 1.0 0.1 (1) 0.4 4.7 4.0 0.2 3.5 3.1 (2) 1.9 1Q 2Q 3Q 4Q 1Q 2009 2010 (1) Charges related to Ocala Funding LLC of approx. EUR 350 m (2) Includes net effect of losses related to write-downs on specific risks in our structured
Slide 17: Sales & Trading debt and other products
Sales & Trading debt and other products Net revenues Key features In EUR bn Overall — Second best quarter ever driven by good results Specific item across all businesses Mark-downs — High levels of client demand in January and Net revenues March — Sustained lower usage of balance sheet, RWA and risk
Slide 18: Sales & Trading equity
Sales & Trading equity Net revenues Key features In EUR m Overall — Best quarterly result since 4Q2007 >4x — Good performance across all product areas in a challenging market environment 944 — Platform starting to benefit from investment 927 Cash Equities 873 — Good performance in secondary trading
Slide 19: Origination & Advisory
Origination & Advisory Net revenues Key features In EUR m General Advisory — Fee pool up 39% vs. 1Q09 — DB at #4(1) position globally; #1 position in EMEA Origination 61% — Continued reduction in legacy assets Advisory — Market announced volumes up 21% vs. 1Q09 725 — #5 globally by fees – market sha
Slide 20: Global Transaction Banking: P&L at a glance
Global Transaction Banking: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 636 666 630 (5)% 1% Provision for credit losses 4 (1) (12) n.m. n.m. Noninterest expenses (520) (438) (438) 19% 19% Income before income taxes 119 227 180 (47)% (34)% CIR 82% 66
Slide 21: Global Transaction Banking
Global Transaction Banking Income before income taxes Key features In EUR m Revenues — Ongoing low interest rate environment continues (47)% to adversely impact all businesses — Trade Finance: Continued strong performance 227 with trade volumes picking up, however signs of Risk based funding 29 decl
Slide 22: Asset and Wealth Management: P&L at a glance
Asset and Wealth Management: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 831 514 783 62% 6% Provision for credit losses (3) (5) (3) (41)% (10)% Noninterest expenses (832) (687) (456) 21% 83% Income before income taxes (5) (173) 325 (97)% n.m. CIR 10
Slide 23: Asset Management
Asset Management Income before income taxes Key features In EUR m — Portfolio / Fund Management fees further Reversal of impairment DWS Scudder improving in positive market environment — Lower performance-related fees in line 348 with traditional quarterly pattern Career retirement (29) — Net new mo
Slide 24: Private Wealth Management
Private Wealth Management Income before income taxes Key features In EUR m — Excluding Sal. Oppenheim revenues are xx IBIT ex Sal. Oppenheim up 15% (vs. 1Q2009) mainly due to 24 — Higher transaction based revenues, predominantly due to increase in Asia Sal. Oppenheim (59) Pacific, NEMEA and Germany
Slide 25: Private & Business Clients: P&L at a glance
Private & Business Clients: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 1,412 1,381 1,391 2% 1% Provision for credit losses (170) (165) (198) 3% (14)% Noninterest expenses (1,053) (1,010) (1,146) 4% (8)% Income before income taxes 189 206 47 (8)% n.
Slide 26: Private & Business Clients
Private & Business Clients Income before income taxes Key features In EUR m Revenues: Severance(1) — Investment Products: First slow recovery (8)% in securities business, supported by positive capital markets and successful EUR ~ 60 m LLP release(2) placement of Discretionary Portfolio Career retire
Slide 27: Agenda
Agenda 1 Group results 2 Segment results 3 Key current issues Deutsche Bank 1Q2010 results financial transparency. 27 Investor Relations Stefan Krause, CFO
Slide 28: Sal. Oppenheim: Dedicated strategy for each business activity
Sal. Oppenheim: Dedicated strategy for each business activity Cluster 1 Cluster 2 Cluster 3 Cluster 4 WM GER + AM Select WM / AM Other business GER/LUX international activities Wealth Management Switzerland IB Wealth Management Germany Austria Other (BAS, SGG, Asset Management Asset Management Alter
Slide 29: Financial impact of Sal. Oppenheim acquisition
Financial impact of Sal. Oppenheim acquisition Impact on DB Group as of 31 March 2010 Total assets ~ EUR 30 bn RWA EUR 17 bn Tier 1 capital deduction (incl. goodwill and other intangibles) EUR 1.3 bn Impact on P&L(1) in 1Q2010 (consolidated since 29 January 2010) preliminary allocation In EUR m Grou
Slide 30: Sal. Oppenheim: Asset base
Sal. Oppenheim: Asset base Invested assets development Sal. Oppenheim Group(1) Observations In EUR bn 8 127 — Invested assets have 15 grown with only (2) 103 (2) 105 1 4 45 marginal net outflows (1) (4) BHF 34 (3) 38 — Invested assets of IB, SOPEP, 14 core proposition(5) OVAM & other 2 WM foreign 2
Slide 31: PWM and Sal. Oppenheim: Benefits, synergies and outlook
PWM and Sal. Oppenheim: Benefits, synergies and outlook — Undisputed leadership in Private Wealth Management in Germany — Complementary client profile, particularly in the UHNWI client segment Strategic — Second wealth management proposition with strong brand complementing business impact portfolio
Slide 32: Complexity reduction program: Further strengthen competitive position
Complexity reduction program: Further strengthen competitive position Efficiency gains and complexity Development cost/income ratio reduction Reported, in % 134 — Efficiency gains and complexity reduction is planned to result in EUR 1 bn cost savings in infrastructure areas (based on 2009 82 figures
Slide 33: Complexity reduction program: EUR 1 bn efficiency gains by end of 2011
Complexity reduction program: Structured process to achieve EUR 1 bn efficiency gains by end of 2011 Identify Develop Validate Prepare Validate ideas initiatives initiatives Decision execution Execute impact Regular progress and impact tracking by Group Executive Committee Objectives Achievements —
Slide 34: On track to achieve 2011 targets
On track to achieve 2011 targets Income before income taxes, in EUR bn Phase 4 1Q2010 potential reported 2011 Prospects / Key features — Capture client flow / market share with prudent risk Corporate Banking & taking 2.6 6.3 Securities — Record performance in traditionally strong first quarter Globa
Slide 35: Additional information
Deutsche Bank Additional information
Slide 36: Loan book
Loan book In EUR bn xx IAS 39 impact on CIB loan book (2)% 276 268 270 263 261 14 13 13 13 CI 13 38 37 35 34 34 154 144 137 133 136 CIB 108 110 113 115 121 PCAM 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 2009 2010 Germany excl. Financial Institutions: 96 96 96 96 100 Note: Total incl. CI / Other; loan amoun
Slide 37: PBC loan book: Delinquency ratio
PBC loan book: Delinquency ratio At period end, 90≤x≤269 days past due(1)(2) Small corporates Mortgage Consumer Mortgage loans represent ~70% of PBC loan book 3.39% 3.31% 2.76% 2.71% 2.65% 2.49% 2.58% 2.34% 2.40% 2.15% 2.21% 1.90% 1.95% 1.99% 2.01% 1.78% 1.83% 1.84% 1.61% 1.69% 1.52% 1.71% 1.78% 1.6
Slide 38: Composition of loan book and provisions by category
Composition of loan book and provisions by category In EUR bn, as of 31 Mar 2010 xx 1Q2010 provision for credit losses(1), in EUR m IAS 39 reclassified assets 262 69 115 78 – Low loan 270 to value 34 – Substantially hedged – Highly diversified – Mostly – Substantially – Short term / collateralised c
Slide 39: Pro-forma impact of IAS 39 reclassifications
Pro-forma impact of IAS 39 reclassifications In EUR m FY2008 - 2Q2009 - Total Total 1Q2010 1Q2009 4Q2009 FY08-FY09 FY08-1Q10 Incremental reported income(1) (162) (1,188) (1,350) (128) (1,478) Fair value P&L impact of reclassified 4,653 (231) 4,422 (279) 4,143 assets Net pro-forma impact on reported
Slide 40: Impaired loans
Impaired loans In EUR bn xx IAS 39 impact - IFRS impaired loans 7.2 7.4 6.7 6.8 4.5 1.1 2.6 2.6 2.8 2.9 50% 46% 47% 46% 47% 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 2009 2010 IFRS impaired loans(1) IFRS impaired loans coverage ratio(2) (1) IFRS impaired loans include loans which are individually impaired
Slide 41: Monoline update
Monoline update Exposure materially reduced, reserve levels remain adequate Substantial reduction since 1Q2009 … and exposure adequately peak … reserved In EUR bn(1) In EUR bn, as of 31 Mar 2010 Fair value after CVA CVA Fair value after CVA CVA 9.1 (44)% 7.6 Net exposure to non-investment grade: 5.9
Slide 42: Value of Level 3 assets
Value of Level 3 assets(1) Asset classes 1Q2010 development In EUR bn — Key changes: (6)% — Reduction mainly due to transfer of assets into level 2 as a result of 60 58 2 3 56 increased observability 4 3 8 33 11 6 28 25 26 Financial assets AfS / Other 16 16 17 Financial assets(2) Other trading asset
Slide 43: Funding and liquidity
Funding and liquidity In EUR bn Funding sources overview Liquidity position 31 Dec 2009 (Total: EUR 777 bn) — Secured funding increase mainly 31 Mar 2010 (Total: EUR 856 bn) 211 against highly liquid trading assets 173 165 164 — Incremental discretionary 153 158 wholesale funding more than 118 123 o
Slide 44: U.S. GAAP pro-forma assets
U.S. GAAP pro-forma assets In EUR bn 978 891 68 Derivatives post-netting Positive market values from 69 derivatives 233 263 Trading assets Financial assets Trading securities 207 at FV through P&L 234 30 Other trading assets 28 120 Reverse repos / 13 securities borrowed 104 12 Loans des. at FV 13 11
Slide 45: Tier 1 capital and RWA development
Tier 1 capital and RWA development In EUR bn Tier 1 capital RWA 14.4 0.7 1.8 292.5 (6.7) (1.3) 6.5 34.4 1.5 3.3 32.8 273.5 (2.1) (0.1) (0.5) 31 Dec 1Q10 FX Sal. Capital Equity Other(2) 31 Mar 31 Dec Market Opera- FX Sal. Other 31 Mar 2009 Net effects Oppen- de- com- 2010 2009 risk(3) tional effects
Slide 46: Group headcount
Group headcount Full-time equivalents, at period end 31 Mar 2010 vs. 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 31 Dec 2009 2009 2009 2009 2009 2010 Net of Total de-/consoli- change dation CIB 14,367 14,127 14,312 14,279 14,467 188 188 PCAM 32,611 31,817 31,568 30,578 31,791 1,213 (288) Corporate Investment
Slide 47: Number of shares for EPS calculation
Number of shares for EPS calculation In million Average At end of period 1Q FY 1Q 31 Mar 31 Dec 31 Mar 2009 2009 2010 2009 2009 2010 Common shares issued 585 612 621 621 621 621 Total shares in treasury (6) (4) (3) (3) (1) (2) Common shares outstanding 579 608 618 618 620 619 Vested share awards(1)
Slide 48: Invested assets report
Invested assets(1) report In EUR bn Net new 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar money 2009 2009 2009 2009 2010 1Q2010 Asset and Wealth Management 627 632 657 686 808 9 Asset Management 462 460 476 496 537 4 therein: Sal. Oppenheim (2) - - - - 14 0 Institutional 169 160 165 173 180 (1) Retail 142 153
Slide 49: Regional invested assets – AM and PWM
Regional invested assets(1) – AM and PWM In EUR bn 31 Mar 10 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar vs. 2009 2009 2009 2009 2010 31 Dec 09 Asset Management 462 460 476 496 537 8% Germany 194 200 211 214 238 11 % therein: Sal. Oppenheim(2) - - - - 14 n.a. UK 17 18 17 21 21 (1)% Rest of Europe 32 28 29 29
Slide 50: Regional net new money – AM and PWM
Regional net new money – AM and PWM In EUR bn 1Q2009 2Q2009 3Q2009 4Q2009 FY2009 1Q2010 Asset Management (3) (3) 5 9 9 4 Germany (3) (2) 2 1 (2) 4 UK (0) 1 0 4 5 (0) Rest of Europe (0) (1) (1) (0) (1) 1 Americas 1 (2) 4 5 7 0 Asia / Pacific (0) 0 (0) 0 0 (1) Private Wealth Management (1) 1 5 3 7 5 G
Slide 51: Corporate Investments
Corporate Investments Income before income taxes Key features In EUR m — Equity pick-up of EUR 132 m related to Deutsche Postbank AG 1% — Revenues related to Sal. Oppenheim 377 acquisition (BHF Bank AG) of EUR 68 m 117 65 65 (103) 1Q 2Q 3Q 4Q 1Q 2009 2010 Deutsche Bank 1Q2010 results financial trans
Slide 52: Asset Management: P&L at a glance
Asset Management: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 390 195 426 100% (8)% Provision for credit losses (0) 0 0 n.m. n.m. Noninterest expenses (360) (370) (80) (3)% n.m. Income before income taxes 30 (171) 348 n.m. (91)% CIR 92% 190% 19% Deu
Slide 53: Private Wealth Management: P&L at a glance
Private Wealth Management: P&L at a glance In EUR m 1Q2010 1Q2010 vs. vs. 1Q2010 1Q2009 4Q2009 1Q2009 4Q2009 Net revenues 441 319 357 38% 24% Provision for credit losses (3) (5) (3) (42)% (12)% Noninterest expenses (472) (316) (376) 49% 26% Income before income taxes (36) (2) (23) n.m. 57% CIR 107%
Slide 54: VaR of CIB trading units
VaR of CIB trading units 99%, 1 day, in EUR m VaR of CIB trading units Constant VaR of CIB trading units(1) EUR 4.0 bn Sales & Trading revenues EUR 4.7 bn 180 160 140 120 100 80 60 40 20 141 145 114 108 116 45 44 35 36 47 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 (1) Constant VaR is an
Slide 55: Balance sheet leverage ratio (target definition)
Balance sheet leverage ratio (target definition) In EUR bn 2009 2010 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar Total assets (IFRS) 2,103 1,733 1,660 1,501 1,670 Adjust derivatives according to U.S. GAAP netting rules (1,019) (681) (617) (533) (559) Adjust pending settlements according to U.S. GAAP nett. ru
Slide 56: 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