Deutsche Bank AG · XETR:DBK
Deutsche Bank — Q3 2011 Earnings Presentation
48 slides from Deutsche Bank's earnings presentation, Oct 25, 2011
Slide 1: 3Q2011 Results
Deutsche Bank 3Q2011 Results Stefan Krause Chief Financial Officer Analyst a yst Ca Call,, 25 5 Octobe October 2011 0 Deutsche Bank 3Q2011 Results financial transparency. Investor Relations Stefan Krause, CFO
Slide 2: Key take-aways
Key take-aways — Solid Group profitability despite deteriorating market conditions, charges relating to Greek bond holdings and other specific items — CB&S remained i d profitable fit bl ddespite it substantial b t ti l market k t volatility l tilit and d client li t risk i k aversion i — GTB result
Slide 3: Agenda
Agenda 1 Group results 2 Segment results 3 Key current topics Deutsche Bank 3Q2011 Results financial transparency. 3 Investor Relations Stefan Krause, CFO
Slide 4: Overview
Overview 3Q2011 3Q2010 Income before income taxes (in EUR bn) 0.9 (1.0) Profita- Net income (in EUR bn) 0.8 (1.2) bility Pre-tax RoE (target definition)(1) 7% 13% Diluted EPS ((in EUR)) 0 74 0.74 (1 75) (1.75) 30 Sep 2011 30 Jun 2011 C Core Ti Tier 1 capital i l ratio i 10 1% 10.1% 10 2% 10.2% Capit
Slide 5: Profitability
Profitability Income before income taxes Net income In EUR bn In EUR bn 2.8 3.0 1.8 1.8 2.1 1.5 1 3(1) 1.3 0.9 1 1(1) 1 2 1.1 1.2 12 1.2 0.7 0.6 0.8 (1.0) (1.2) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2010 2011 2010 2011 Pre-tax return on equity(2), in % Effective tax rate, in % 30 15 (10)/13(1) 6
Slide 6: Noninterest expenses
Noninterest expenses I EUR b In bn Acquisitions:(2) Compensation and benefits In EUR m 2Q2011 3Q2011 General and 19 3 19.3 administrative expenses Compensation & benefits 453 446 993 1,079 17.0 Other noninterest expenses(1) General and admin. 540 633 expenses 10.3 9.6 6.3 7.1 5.9 5.4 5.7 6.3 5.9 36
Slide 7: Capital ratios and risk-weighted assets
Capital ratios and risk-weighted assets 14.0 13.8 13.4 Tier 1 ratio, in % 12.3 11.2 11.3 11.5 9.6 10.2 10.1 Core Tier 1 ratio, 8.7 in % 7.5 7.5 7.6 346 328 320 338 292 303 277 RWA, in EUR bn 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2010 2011 Note: Tier 1 ratio = Tier 1 capital / RWA; Core Tier 1 ratio = (Tier 1 capital
Slide 8: Core Tier 1 capital and RWA development
Core Tier 1 capital and RWA development Core Tier 1 capital RWA In EUR bn In EUR bn 0.9 34 1 34.1 0.9 0.3 337.6 0.7 0.1 9.3 32.5 (0.2) 7.4 319 7 319.7 30 Jun Net Dividend Other (2) FX effect 30 Sep 30 Jun FX effect Credit risk Market risk Operational 30 Sep 2011 income(1) accrual 2011 2011 risk 2011
Slide 9: Agenda
Agenda 1 Group results 2 Segment results 3 Key current topics Deutsche Bank 3Q2011 Results financial transparency. 9 Investor Relations Stefan Krause, CFO
Slide 10: Segment overview
Segment overview I Income before b f income i taxes, t in i EUR m 3Q2011 3Q2010 (1) 70 CB&S 1,087 259 GTB 227 186 AWM 91 310(2) PBC 245 (85) CI (2,350) 202 C&A (349) (1) Includes a charge relating to the impairment of a German VAT claim of EUR (310) m (2) Includes EUR 185 m negative impact from Gree
Slide 11: Corporate Banking & Securities
Corporate Banking & Securities Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 Charge relating to the impairment of a German VAT claim 3Q11 2Q11 3Q10 vs. vs. 3Q10 2Q11 2,572 Revenues 2,602 3,977 4,183 (38)% (35)% 2 287 2,287 P i i Provisions (1) (51) (96) (136) (63)% (47)% Nonint
Slide 12: Sales & Trading debt and other products
Sales & Trading debt and other products Net revenues Key features In EUR m Overall — Significantly lower revenues in most flow products, as a result of low client volumes in uncertain macro-economic environment — Partially offset by good performance in Foreign Exchange, 3 849 3,849 3,691 Commodities
Slide 13: Sales & Trading equity
Sales & Trading equity Net revenues Key features In EUR m Overall — Significantly lower revenues reflecting extremely volatile equity markets and weak client activity, especially in Europe 944 943 872 Cash Equities — Higher revenues due to increased market share and 642 650 commissions in Europe and
Slide 14: Origination & Advisory
Origination & Advisory Net revenues Key features Overall In EUR m — Macro environment impacted Origination activity with market- Advisory wide issuance levels down approximately 50% Origination — Ranked No.6 globally - very small gap to No.5 — No.1 in EMEA and No.5 in APAC 809 Advisory 717 714 — 3Q
Slide 15: Global Transaction Banking
Global Transaction Banking Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 3Q11 2Q11 3Q10 vs. vs. Negative goodwill(1) 3Q10 2Q11 4Q2010 efficiency measures(2) Revenues 941 886 837 12% 6% ((3)) Provisions (41) (31) (43) (4)% 34% 485 Noninterest exp. (640) (548) (567) 13% 17% IBIT
Slide 16: Asset and Wealth Management
Asset and Wealth Management Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 3Q11 2Q11 3Q10 vs. vs. 227 3Q10 2Q11 190 Revenues 876 976 939 (7)% (10)% 186 (1) Provisions P i i (11) (13) (20) (44)% (17)% Noninterest exp. (680) (737) (831) (18)% (8)% IBIT 186 227 91 103% (18)% (2) 91
Slide 17: Asset Management
Asset Management Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 124 3Q11 2Q11 3Q10 vs. vs. 117 3Q10 2Q11 Revenues 397 453 438 (9)% (12)% 96 Provisions(1) 1 (0) 0 nm n.m. nm n.m. 84 Noninterest exp. (281) (328) (354) (21)% (14)% 75 IBIT 117 124 84 38% (6)% (2) Invested assets 516
Slide 18: Private Wealth Management
Private Wealth Management Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 3Q11 2Q11 3Q10 vs. vs. 3Q10 2Q11 Revenues 479 523 501 (4)% (8)% ((1)) 116 Provisions (12) (13) (20) (39)% (6)% 102 Noninterest exp. (398) (408) (477) (16)% (2)% 69 IBIT 69 102 7 n.m. (33)% (2) Invested asse
Slide 19: Private & Business Clients
Private & Business Clients Income before income taxes Key features In EUR m In EUR m 3Q11 3Q11 3Q11 2Q11 3Q10 vs. vs. Net HuaXia one-off gain 3Q10 2Q11 Negative impact from Greek 78 government bonds(1) Revenues 2,426 2,563 1,455 67% (5)% Cost-to-achieve Cost to achieve related to Postbank ((2)) Prov
Slide 20: Agenda
Agenda 1 Group results 2 Segment results 3 Key current topics Deutsche Bank 3Q2011 Results financial transparency. 20 Investor Relations Stefan Krause, CFO
Slide 21: Net sovereign exposure on selected countries
Net sovereign exposure on selected countries I EUR bn In b Net sovereign exposure Key features 31 Dec 2010 — N Nett exposure tto GIIPS sovereigns i 30 Jun 2011 12.1 significantly reduced since 31 Dec 2010 30 Sep 2011 — Quarter-on-quarter movement driven by 8.0 an increase in Italy y ((trading g book
Slide 22: Basel 2.5 / EEA sovereign simulation
Basel 2.5 / EEA(1) sovereign simulation I EUR bn In b Core Tier 1 capital ratio (%) 30 June 2012 pro- 4Q2011 & 1H2012 forma (without mgt. p Basel 2.5 impact EEA sovereign g net income after action other than 30 Sep 2011 after 4Q mgt. action exposure at FV(2) dividend(3) 4Q B2.5) 10.1% 9.1% 76 414 33
Slide 23: Basel 2.5 / Basel 3 update
Basel 2.5 / Basel 3 update(1) I EUR bn In b xx Core Tier 1 ratio (%) Required mgt. Pro forma f RWA Pro forma f Core C Tier 1 capital and ratios action to get to 9% % 10.1% 8.5% 513 4 44 176 5 9.0% 34 338 ~30 bn reduction in RWA equivalents Sep 11 Basel 2.5/3 1 Jan 2013 Sep 11 Net income Add-back 1 J
Slide 24: Funding and liquidity
Funding and liquidity — Substantial rebalancing towards most stable funding sources — Significant reduction in utilisation of wholesale funding — Hi h liliquidity High idit reserves tto buffer b ff against i t extreme t stress t scenarios i — Strong capital markets access and evenly balanced maturit
Slide 25: Funding profile
Funding profile As at 31 Dec 2007 As at 30 Sep 2011 Total: EUR 1,206 bn Total: EUR 1,144 bn(2) 30% of overall funding 55% of overall funding Financing Financing Vehicles from stable funding Vehicles from stable funding 5% sources(1) 2% sources C Capital Capital Markets and Secured Markets and Equity
Slide 26: Liquidity development
Liquidity development Liquidity reserves Liquidity reserves Quarter on quarter development composition growth since last crisis In EUR bn As at 30 Sep 2011 In EUR bn Liquidity reserves(1) >180 Discretionary Unsecured Wholesale Funding(2) Highly liquid (3) iti securities +30 >180 37% Cash +22 51% 65
Slide 27: Funding activities update
Funding activities update Funding cost development Observations I bps In b European Sovereign CDS — Continued to issue at attractive levels in iTraxx Senior Financials 3Q2011 (avg. spread of L+70bps) 400 DB 5yr Senior CDS 360 DB issuance spread (4wk mov avg.) — Recent EUR 1.75 bn 2y senior DB issuan
Slide 28: Balanced cash flow profiles
Balanced cash flow profiles DB capital market maturities(1) Liquidity profile(2) I EUR b In bn I EUR bn In b 20 300 Assets Equity Liabilities 250 200 Surplus 10 150 100 50 0 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021+ >1 >2 >3 >4 >5 >6 >7 >8 >9 >10 — Balanced outflows of capital markets iss
Slide 29: Summary and Outlook
Summary and Outlook — Strength in the face of very challenging conditions — Investment Banking remains profitable even in extremely turbulent markets; classic banking businesses continue to produce record operating performance — Capital ratios remain close to strongest-ever strongest ever levels; pr
Slide 30: Additional information
Deutsche Bank Additional information
Slide 31: Specific items in 3Q2011
Specific items in 3Q2011 I EUR m In 3Q11 Noninterest expenses Non- Business Revenues LLPs Other non- controlling IBIT Comp & Gen. & interest Total interest benefits Admin exp. Specific charge relating to the impairment CB&S - - - (310) - (310) - (310) of a German VAT claim (1) (1) Impairment on Gree
Slide 32: PBC – business division performance
PBC – business division performance I Income b f before income i ttaxes, iin EUR m 3Q2011 – Reported results 2Q2011– Reported results Negative impact from Greek government bonds Cost-to-achieve related to Postbank acquisition (1) 132 11 35 178 1135 Advisory Banking Germany (1) 124 42 35 201 113 Advi
Slide 33: Corporate Investments
Corporate Investments Income before income taxes 3Q2011 key features In EUR m — CI CI’ss 3Q2011 IBIT is mainly impacted by the performance of our investment in Actavis and our consolidated investments 65 (e g Maher Terminals (e.g. Terminals, The Cosmopolitan of Las Vegas) (85) (85) (165) (139) (390)
Slide 34: Provision for credit losses
Provision for credit losses I EUR m In Related to IAS 39 reclassified assets Effect from Postbank releases shown as net interest income at DB Group / PBC level 464 463 (1) 1,300 406 362 373 82 111 47 311 79 23 868 262 129 117 124 243 22 (3) 284 103 50 359 (1) 382 352 (3) (3) 303 329 989(3) 256 865 1
Slide 35: Impaired loans
Impaired loans I EUR bn In b Relating to IAS 39 loans IFRS impaired loans(1) Effect from Postbank(3) 8.5 7.4 7.4 7.4 7.6 6.7 18 1.8 6.3 1.3 2.9 2.8 2.7 0.2 0.8 0.8 1.1 1.2 1.1 4.8 4.9 5.5 5.6 4.5 4.6 4.7 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 2010 2011 Cov. Ratio DB(2) 47% 48% 49% 53% 50%
Slide 36: Loan book
Loan book I EUR bn In b … IAS 39 impact on CIB loan book 34 35 32 27 25 23 23 411 398 398 416 8 10 CI 11 11 292 283 147 150 CIB 270 135 135 13 12 11 126 PCAM ex 136 154 147 126 128 132 Postbank 121 126 125 129 125 123 124 Postbank 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 2010 2011 Germany ex
Slide 37: Composition of loan book and provisions by category
Composition of loan book and provisions by category I EUR bn, In b as off 30 S September t b 2011 ... DB 3Q2011 provision for credit losses(1) ex. PB, in EUR m ... Postbank (PB) 3Q2011 provision for credit losses(1)(2), in EUR m 268 IAS 39 reclassified assets Postbank 463 195 150 68 50 416 Low loa
Slide 38: IAS 39 reclassification
IAS 39 reclassification Carrying Value vs. Fair Value 3Q2011 developments In EUR bn — The Gap between carrying value and fair value Sales & Trading - Debt Loan Products has grown by EUR 0.4 bn in 3Q2011, Origination and Advisory EUR 0.6 bn since 31 Dec 2010 31 Dec 31 Dec 31 Dec 31 Mar 30 Jun 30 Sep
Slide 39: Group headcount
Group headcount F ll ti Full-time equivalents, i l t att period i d end d 30 Sep 2011 vs. 31 Mar 30 Jun 30 Sep 30 Jun 2011 2011 2011 2011 Total Net of change de-/consolidation CIB 15,391 15,309 15,364 54 54 PCAM 50,419 50,195 50,070 (125) (125) Corporate 1,469 1,443 1,474 31 31 Investments Infrastru
Slide 40: Capital authorizations
Capital authorizations AGM Mio shares Mio. approval Status Maturity Authorized capital Rights issue 270 2011 registered 30 April 2016 ex rights issue(1) Rights issue or ex-rights 90 2011 registered 30 April 2016 Rights issue, Ex-rights issue possible against 90 2011 registered 30 April 2016 contribu
Slide 41: Number of shares for EPS calculation
Number of shares for EPS calculation I million In illi Average g At end of period 3Q 2Q 3Q 30 Sep 30 Jun 30 Sep 2010 2011 2011 2010 2011 2011 Common shares issued(1) 683 929 929 683 929 929 Total shares in treasury (3) (9) (23) (4) (19) (13) Common shares outstanding 679 921 907 679 911 917 Vested s
Slide 42: Invested assets report
Invested assets(1) report I EUR bn In b Net new money 31 Mar 2011 30 Jun 2011 30 Sep 2011 2Q2011 3Q2011 Asset and Wealth Management 799 797 780 (0) (13) Asset Management 529 523 516 (5) (12) I tit ti Institutional l 164 163 162 (3) ( ) (5) Retail 175 173 157 0 (4) Alternatives 46 45 46 (0) (0) Insur
Slide 43: Regional invested assets – AM and PWM
Regional invested assets(1) – AM and PWM I EUR bn In b 30 S Sep 11 vs. 31 Mar 2011 30 Jun 2011 30 Sep 2011 30 Jun 11 Asset Management 529 523 516 (1)% Germany 242 246 234 (5)% UK 23 22 22 (2)% Rest of Europe 30 30 29 (2)% Americas 209 202 208 3% Asia Pacific 25 23 22 (4)% Private P i t Wealth W lth
Slide 44: Regional net new money – AM and PWM
Regional net new money – AM and PWM I EUR bn In b 1Q2010 2Q2010 3Q2010 4Q2010 FY2010 1Q2011 2Q2011 3Q2011 Asset Management 4 (12) 2 4 (1) (5) (5) (12) Germany 4 0 (1) 3 6 2 1 (3) UK (0) 1 1 3 4 (4) (0) (2) Rest of Europe 1 (1) (0) (1) (1) (2) (1) 0 Americas 0 (11) 3 (1) (9) (2) (5) (6) Asia Pacific
Slide 45: VaR of CIB trading units
VaR of CIB trading units 99% 1 day, 99%, d in i EUR m VaR of CIB trading units Constant VaR of CIB trading units(1) EUR 2.9 bn Sales & Trading revenues EUR 1.9 bn 87 78 80 75 76 46 45 46 44 43 3Q2010 4Q2010 1Q2011 2Q2011 3Q2011 (1) Constant VaR is an approximation of how the VaR
Slide 46: Total assets (adjusted)
Total assets (adjusted) I EUR bn In b 1,296 Derivatives post- 1,209 85 netting Positive market values Derivatives p post- from derivatives 60 netting 238 Trading securities 259 267 Trading assets Financial assets at FV through g P&L 290 Trading assets 29 Other trading assets 30 144 Reverse repos / s
Slide 47: Balance sheet leverage ratio (target definition)
Balance sheet leverage ratio (target definition) I EUR bn In b 2010 2011 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep Total assets (IFRS) 1,670 1,926 1,958 1,906 1,842 1,850 2,282 Adjustment for additional derivatives netting (559) (735) (760) (602) (508) (503) (821) Adj t Adjustment t for f add
Slide 48: Cautionary statements
Cautionary statements This presentation contains forward forward-looking looking statements. Forward Forward-looking 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 b