Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Q2 2014 Earnings Presentation
48 slides from Deutsche Bank's earnings presentation, Jul 29, 2014
Slide 1: Deutsche Bank 2Q2014 results
Deutsche Bank Deutsche Bank 2Q2014 results 29 July 2014
Slide 2: Key Group financial highlights
Key Group financial highlights In EUR bn, unless otherwise stated Group Core Bank(1) 2Q2014 2Q2013 2Q2014 2Q2013 Income before income taxes 0.9 0.8 1.5 1.5 Net income 02 0.2 03 0.3 na n.a. na n.a. Diluted EPS (in EUR) 0.21 0.31 n.a. n.a. Profitability Post-tax return on average active equity(2) 1.6%
Slide 3: Core bank adjusted IBIT
Core bank adjusted IBIT In EUR bn 2Q2014 Group reported IBIT to EUR 1.5 bn Core Bank adjusted IBIT: 0.1 2.4 2.4 0.4 0.4 0.6 1.5 0.9 2Q2014 NCOU Core Bank Litigation/ Investing in CVA / DVA / 2Q2014 2Q2013 Group reported IBIT impair- our platform (2) FVA (3) Core Bank Core Bank reported IBIT ments (1
Slide 4: Agenda: Key current themes
Agenda 1 Key current themes 1.1 Capital 1.2 Leverage 13 1.3 Litigation 2 Group results 3 Segment results Deutsche Bank 2Q2014 results financial transparency. 3 29 July 2014
Slide 5: Capital: CET 1 ratio strengthened, yet further headwinds expected
Capital: CET 1 ratio strengthened, yet further headwinds expected CET 1 ratio Outlook CRD4 Common Equity Tier 1 ratio, fully-loaded, in % Further headwinds expected from: 2.5 12.0 11.5 — EBA Regulatory Technical Standards e.g.: 9.5 (0.5) — Prudent Valuation: Potential EUR 1.5 – 2.0 bn capital impact
Slide 6: Capital: Common Equity Tier 1 and RWA development
Capital: Common Equity Tier 1 and RWA development CRD4, fully-loaded Common Equity Tier 1 capital RWA In EUR bn In EUR bn 9 5% 9.5% 11 5% 11.5% 78 7.8 398 7 398.7 4.6 4.9 3.7 1.5 2.7 1.3 0.7 0.2 0.2 0.1 46.0 373.3 (0.3) (0.2) EUR 7.6 bn EUR 2.5 bn enhancement of 8.5 35.3 regulatory Operational p Ris
Slide 7: Leverage: Exposure and Tier 1 Capital update
Leverage: Exposure and Tier 1 Capital update Tier 1 Capital, fully-loaded CRD4 Leverage exposure In EUR bn In EUR bn Significant impact of proceeds of capital 2.5% 3.4% and AT1 issuance 29 1,447 3.5 0.8 49.4 1.3 9 5 85 8.5 1 423 1,423 9 (8) 35.3 (20) 48.6 31 Mar Capital 10/15 AT 1 Other 30 Jun 31 Ma
Slide 8: Litigation: Update
Litigation: Update In EUR bn Mortgage repurchase Litigation reserves Contingent liabilities demands/reserves In USD Demands Reserves 3.2 2.2 5.0 4.6 1.8 2.0 0.6 0.5 31 Mar 2014 30 Jun 2014 31 Mar 2014 30 Jun 2014 31 Mar 2014 30 Jun 2014 — Net litigation reserves were up — This includes possible obli
Slide 9: Agenda: Group results
Agenda 1 Key current themes 2 Group p results 3 Segment results Deutsche Bank 2Q2014 results financial transparency. 8 29 July 2014
Slide 10: Net revenues
Net revenues In EUR bn 9.4 8.2 8.4 7.9 7.7 6.6 1Q 2Q 3Q 4Q 1Q 2Q 2013 2014 Contribution to Group revenues ex Consolidation & Adjustments by business segment(1): CB&S 47% 43% 37% 36% 47% 44% PBC 25% 29% 29% 35% 28% 30% % GTB 11% 12% 13% 14% 12% 13% DeAWM 13% 12% 16% 17% 12% 14% NCOU 5% 3% 5% (2)% 1%
Slide 11: Provision for credit losses
Provision for credit losses In EUR m Cost of Risk(1) Non-Core Operations Unit Cost of Risk Deutsche Bank Group(1) Core Bank Cost of Risk Core Bank((1)) 0.80% 725 0.70% 0.60% 512 319 473 0.50% 354 174 0.40% 239 250 87 246 0.30% 67 19 407 0.20% 267 299 273 230 179 0.10% 1Q 2Q 3Q 4Q 1Q 2Q 2013 2014 CB&
Slide 12: Cost: Reported and adjusted
Cost: Reported and adjusted In EUR bn 6.9 7.2 7.6 6.6 6.5 6.7 Non-Compensation 31 3.1 37 3.7 43 4.3 49 4.9 31 3.1 37 3.7 Compensation and benefits 3.5 3.2 2.9 2.7 3.3 3.0 1Q 2Q 3Q 4Q 1Q 2Q 2013 2014 Adj. cost base 6,034 5,910 5,600 5,604 5,992 5,723 (in EUR m) excludes: Cost-to-Achieve 224 357 242 5
Slide 13: Cost: Update on operating cost and OpEx development
Cost: Update on operating cost and OpEx development 2Q2014 vs. 2Q2013 OpEx program to date In EUR bn Key drivers: In EUR bn — Establishing new control function capabilities 1HY2014 IInvested/ t d/ — Integrating platforms and enhancing end-to-end (E2E) processes 2012/2013 achieved — Strengthening our
Slide 14: Profitability
Profitability Income before income taxes Net income In EUR bn In EUR bn 24 2.4 1.7 1.7 0.9 1.1 0.8 0.2 0.0 0.3 0.1 (1.4) (1.8) 1Q 2Q 3Q 4Q 1Q 2Q 1Q 2Q 3Q 4Q 1Q 2Q 2013 2014 2013 2014 Post-tax return on equity(1) Effective tax rate 12% 2% 0% (10)% 8% 2% 31% 58% (183)% 23% 34% 74% FY2013: 1.2% 1H2014:
Slide 15: Group adjusted IBIT and ROE
Group adjusted IBIT and ROE In EUR bn Post-tax RoE (%) Pro-forma post-tax RoE (%)(1) 4.7 13.4 0.7 0.2 5.0 0.4 1.1 3.7 2.6 1H2014 Group NCOU Core Bank Litigation/ Investing in CVA / DVA / 1H2014 reported IBIT reported IBIT impair- our platform(3) FVA(4) Core Bank ments(2) adjusted IBIT Note: Figures
Slide 16: Agenda: Segment results
Agenda 1 Key current themes 2 Group p results 3 Segment results Deutsche Bank 2Q2014 results financial transparency. 15 29 July 2014
Slide 17: Corporate Banking & Securities
Corporate Banking & Securities Income before income taxes Key features In EUR m In EUR m 2Q14 vs. 2Q14 vs. 1 908 1,908 2Q14 2Q13 1Q14 2Q13 1Q14 Revenues (1) 3,532 3,579 4,076 (1)% (13)% 1,492 Prov. for credit (44) (26) (16) 70 % 184 % losses Noninterest exp. (2,603) (2,794) (2,547) (7)% 2% 758 885 I
Slide 18: Sales & Trading
Sales & Trading Revenues Key features Debt S&T, in EUR m Debt Sales & Trading 2 717 2,717 — FX revenues significantly lower and Rates revenues 2,433 lower y-o-y driven by historically low volatility and lower 1,823 client activity 1,826 — Global Liquidity Management revenues in-line y-o-y 1,248 desp
Slide 19: Origination & Advisory
Origination & Advisory Revenues Key features Advisory in EUR m Overall Origination — Revenues up 10% yy-o-yo y driven by higher revenues in 811 Equity Origination and Advisory while Debt Origination revenues were in-line y-o-y 737 701 130 — Ranked #5 in global corporate finance, achieving record 674
Slide 20: Private & Business Clients
Private & Business Clients Income before income taxes Key features In EUR m In EUR m 2Q14 vs. 2Q14 vs. 2Q14 2Q13 1Q14 2Q13 1Q14 507 520 483 Revenues 2,367 2,448 2,476 (3)% (4)% Prov. for credit 403 losses (145) (194) (140) (25)% 4% 347 Noninterest exp. (1,819) (1,747) (1,815) 4% 0% IBIT 403 507 520
Slide 21: Private & Business Clients: Profit by business unit
Private & Business Clients: Profit by business unit Income before income taxes, in EUR m Cost-to-Achieve(1) Private & Commercial Banking Postbank Advisory Banking International 48 32 63 19 11 59 17 1 5 11 6 51 41 70 25 155 204 204 53 177 86 188 161 204 164 118 145 155 146 128 126 95 117 74 52 21 1Q
Slide 22: Global Transaction Banking
Global Transaction Banking Income before income taxes Key features In EUR m Impairment of goodwill and other intangible assets In EUR m 2Q14 vs. 2Q14 vs. 380 2Q14 2Q13 1Q14 367 2Q13 1Q14 318 324 Revenues 1,035 1,036 1,028 (0)% 1% Prov. for credit (47) (79) (24) (41)% 97 % (2) losses 228 143 Noninter
Slide 23: Deutsche Asset & Wealth Management
Deutsche Asset & Wealth Management Income before income taxes Key features In EUR m Impairment of goodwill and other intangible assets In EUR m 2Q14 vs. 2Q14 vs. 2Q14 2Q13 1Q14 2Q13 1Q14 283 Revenues 1,134 1,041 1,067 9% 6% (3) Prov. for credit 6 (0) 1 n.m. n.m. 219 214 losses (14) 204 Noninterest e
Slide 24: Non-Core Operations Unit
Non-Core Operations Unit Income before income taxes Key features In EUR m In EUR m 2Q14 vs. 2Q14 vs. 2Q14 2Q13 1Q14 2Q13 1Q14 Revenues (44) 279 74 n.m. n.m. Prov. for credit (19) (174) (67) (89)% (71)% (258) losses Noninterest exp. (517) (777) (539) (33)% (4)% (532) (580) IBIT (580) (672) (532) (14)
Slide 25: NCOU: De-risking since June 2012
NCOU: De-risking since June 2012 De-risking milestones Size of Non-Core Operations Unit — Since June 2012: Capital generation of EUR 5.8 bn, Total adjusted assets, in EUR bn 134 bps CET1 ratio benefit(1) ((65)% ) — Since June 2013: EUR 39 bn reduction in CRD4 leverage exposure includes EUR 8 bn duri
Slide 26: Consolidation & Adjustments
Consolidation & Adjustments Income before income taxes Key features In EUR m In EUR m 2Q14 vs. 2Q14 vs. 2Q14 2Q13 1Q14 2Q13 1Q14 IBIT (223) (205) (336) 9% (34)% (205) (153) thereof (223) (1) (255) V&T differences (13) (9) (133) 42 % (91)% (336) FVA (26) - ((94)) n.a. ((73)% ) Spreads for capital (75
Slide 27: Appendix
Deutsche Bank Appendix 26
Slide 28: Appendix: Table of Contents
Appendix: Table of Contents IBIT detail 28 NCOU Details 32 Total assets (adjusted) 34 CRD4 – Balance sheet and risk weighted assets 35 Loan book 36 Impaired loans 38 V l Value-at-Risk t Ri k 39 Funding 40 Number of shares 42 Invested assets 44 Group headcount 46 Deutsche Bank 2Q2014 results financia
Slide 29: 2Q2014: IBIT detail
2Q2014: IBIT detail 2Q2014 In EUR m IBIT reported CtA Litigation CVA/DVA/ FVA Other(1) IBIT adjusted CB&S 885 (161) (259) (114) (5) 1,423 PBC 403 (94) (0) 0 (2) 499 GTB 228 (32) (100) 0 (2) 363 DeAWM 204 (82) (10) 0 (1) 298 C&A (223) 1 (6) (26) (5) (188) Core Bank 1,498 (368) (375) (140) (15) 2,396
Slide 30: 2Q2013: IBIT detail
2Q2013: IBIT detail 2Q2013 In EUR m IBIT reported CtA Litigation CVA/DVA/ FVA Other(1) IBIT adjusted CB&S 758 (20) (452) (88) (20) 1,339 PBC 507 (133) (1) 0 (10) 652 GTB 324 (23) (0) 0 (3) 349 DeAWM 80 (171) (10) 0 (6) 267 C&A (205) (3) (0) 0 (3) (199) Core Bank 1,464 (351) (463) (88) (42) 2,408 NCO
Slide 31: 1H2014: IBIT detail
1H2014: IBIT detail 1H2014 In EUR m IBIT reported CtA Litigation CVA/DVA/ FVA Other(1) IBIT adjusted CB&S 2,376 (272) (240) (106) (17) 3,012 PBC 923 (201) (0) 0 (6) 1,130 GTB 595 (51) (98) 0 (3) 748 DeAWM 374 (138) (23) 0 (5) 539 C&A (559) (4) (7) (120) (11) (417) Core Bank 3,709 (665) (369) (226) (
Slide 32: 1H2013: IBIT detail
1H2013: IBIT detail 1H2013 In EUR m IBIT reported CtA Litigation CVA/DVA/ FVA Other(1) IBIT adjusted CB&S 2,666 (122) (508) 49 (20) 3,268 PBC 990 (217) (1) 0 (15) 1,223 GTB 642 (30) (0) 0 (5) 677 DeAWM 300 (186) (24) 0 (7) 516 C&A (460) (4) (2) 0 (4) (451) Core Bank 4,137 (558) (535) 49 (51) 5,233 N
Slide 33: NCOU IBIT components
NCOU IBIT components IBIT in EUR m, TAA and RWA data as of 30 June 2014 FY2013 1Q2014 2Q2014 Quarterly Performance / Outlook Financial — Mainly related to Wholesale assets. Stable performance driven by Portfolio (986) (186) (188) Credit / interest rates / commodity / CRE exposure (TAA 39 bn, RWA 53
Slide 34: NCOU Portfolio Overview
NCOU Portfolio Overview Total adjusted assets(1) Total adjusted assets(1) In EUR bn, as of 31 March 2014 In EUR bn, as of 30 June 2014 SCG IAS 39 reclassified assets SCG AWM 3.4 AWM IAS 39 1.1 8.3 2.5 reclassified assets Other 1.1 8.0 CI loans CI 7.4 73 7.3 3.1 2.4 Other loans PBC: 3.2 4.5 Monolines
Slide 35: Total assets (adjusted)
Total assets (adjusted) In EUR bn Positive market values 1,084 from derivatives 1,056 43 post netting 43 Financial assets Trading securities 180 188 200 Trading assets 211 Trading assets at FV through P&L Other trading assets 23 Reverse repos / 20 securities borrowed 129 122 Loans des. at FV 14 15 1
Slide 36: CRD4 – Balance sheet and risk weighted assets
CRD4 – Balance sheet and risk weighted assets XX RWA density incl. operational risk RWA(1) vs. balance sheet (assets adj.) XX RWA density excl. operational risk In EUR bn, as of 30 Jun 2014 ~37% 340 340 ~31% 1,084 , Avg RWA density Avg. Market Risk RWA 64 80 Non-derivative ~40% 211 64 trading assets
Slide 37: Loan book
Loan book In EUR bn 400 393 386 393 387 382 NCOU 43 34 22 21 32 23 34 30 31 32 33 D AWM DeAWM 31 213 213 PBC 211 211 214 213 GTB 75 77 73 76 77 72 CB&S 41 40 39 40 42 48 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 2013 2014 Germany excl. Financial Institutions and Public Sector: 182 182 183 183 186 18
Slide 38: Composition of loan book and provisions by category
Composition of loan book and provisions by category In EUR m, as of 30 Jun 2014 Composition of loan book and provisions by category Jun 30, 2014 2Q2014 Non-Core Provision for In EUR m Core Bank Operations Unit Total credit losses Further details PBC Mortgages 148,040 6,861 154,901 low loan to value
Slide 39: Impaired loans
Impaired loans(1) In EUR bn Non-Core Operations Unit Impaired loan ratio Deutsche Bank Group(3) Core Bank Impaired loan ratio Core Bank(3) Impaired loan ratio 4.5% 10.1 9.7 10.1 10.3 10.0 3.5% 9.3 3.7 35 3.5 33 3.3 33 3.3 3.2 3.5 2.5% 2.55% 1.82% 1.5% 6.4 6.2 6.7 6.9 6.1 6.8 0.5% 31 30 30 31 31 31 M
Slide 40: Value-at-Risk
Value-at-Risk DB Group, 99%, 1 day, in EUR m Average VaR Stressed VaR(1) EUR 2.6 bn g revenues Sales & Trading EUR 2.5 bn 180 160 140 120 100 80 60 40 20 55 48 53 54 56 129 95 97 108 105 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 (1) Stressed Value-at-Risk is calculated on the same portfo
Slide 41: Funding activities update
Funding activities update Funding cost and volume development Observations Issuance, in EUR bn — Initial funding plan of EUR 20 bn DB issuance spread, 4 week moving average, in bps achieved in May 2014 — Plan increased to EUR 30 – 35 bn to 200 16 fund additional business growth post 180 EUR 3.5 bn c
Slide 42: Funding Profile
Funding Profile Funding well diversified Highlights 2Q2014 As of 30 June 2014 — Total funding liabilities increased to EUR 1,000 1 000 bn (vs. (vs EUR 984 bn as of Dec 2013) Financing Vehicles 2% — 66% of total funding from most stable sources 66% from most stable funding sources Secured Funding Cap
Slide 43: Number of shares
Number of shares In million Average used for EPS calculation End of period numbers 31 Dec 31 Dec 30 Jun FY2012 FY2013 2Q2014 2012 2013 2014 Common shares issued(1) 974 1,037 1,113 974 1,069 1,379 Total shares in treasury(1) (9) (2) (0) 0 0 0 Common shares outstanding 965 1,034 1,113 974 1,069 1,379
Slide 44: Client view invested assets – DeAWM; Client view net new money – DeAWM
Client view invested assets – DeAWM In EUR bn 30 Jun 2014 31 Mar 2013 30 Jun 2013 30 Sep 2013 31 Dec 2013 31 Mar 2014 30 Jun 2014 vs 31 Mar 2014 Retail 240 234 236 239 244 255 11 Institutional 446 433 416 404 403 406 2 Private Client 265 264 271 279 287 294 7 DeAWM 950 930 923 923 934 955 20 Client
Slide 45: Regional invested assets – DeAWM; Regional net new money – DeAWM
Regional invested assets – DeAWM In EUR bn 30 Jun 2014 31 Mar 2013 30 Jun 2013 30 Sep 2013 31 Dec 2013 31 Mar 2014 30 Jun 2014 vs 31 Mar 2014 Americas 299 290 273 270 265 262 (3) Asia-Pacific 67 64 65 66 70 75 5 EMEA (ex Germany) 237 231 235 245 250 262 12 Germany 346 346 350 341 349 355 6 DeAWM 950
Slide 46: Invested assets – PBC
Invested assets – PBC In EUR bn 30 Jun 2014 vs. 31 Dec 2012 30 Jun 2013 30 Sep 2013 31 Dec 2013 31 Mar 2014 30 Jun 2014 31 Mar 2014 Private & Business Clients 293 285 285 282 284 286 2 Investment & Insurance Products 139 141 143 146 149 153 4 Deposits excl. Sight Deposits 154 144 142 136 135 133 (2)
Slide 47: Group headcount
Group headcount Full-time equivalents, at period end 30 Jun 2014 vs. 31 Dec 2012 30 Jun 2013 30 Sep 2013 31 Dec 2013 31 Mar 2014 30 Jun 2014 31 Mar 2014 CB&S 8,502 8,110 8,469 8,362 8,219 8,120 (98) PBC 37,967 38,575 38,589 37,952 38,284 38,262 (23) GTB 4 314 4,314 4 198 4,198 4 186 4,186 4 068 4,06
Slide 48: Cautionary statements
Cautionary statements This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts;; they y include statements about our beliefs and expectations p and the assumptions p underlying y g them. These statements are based on plans, estima