Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Q3 2013 Earnings Presentation
52 slides from Deutsche Bank's earnings presentation, Oct 29, 2013
Slide 1: Deutsche Bank 3Q2013 results
Deutsche Bank Deutsche Bank 3Q2013 results 29 October 2013
Slide 2: Group financial performance in 3Q2013
Group financial performance in 3Q2013 3Q2013 Non-Core In EUR m Group Core Bank (1) Operations Unit Net revenues 7,745 7,379 367 Provision for credit losses (512) (274) (238) Total noninterest expenses (7,215) (5,904) (1,311) thereof: Litigation (1 163) (1,163) (316) (847) thereof: Cost-to-achieve (2
Slide 3: Agenda
Agenda 1 Key current themes 2 Group p results 3 Segment results Deutsche Bank 3Q2013 results financial transparency. 3 Investor Relations 29 October 2013
Slide 4: Litigation
Litigation Mortgage repurchase Litigation reserves Contingent liabilities(1) demands/reserves In EUR bn In EUR bn In USD bn Demands(2) Reserves ~6.3 ~5.9 ~4.1 ~3.0 ~1.2 ~1.3 ~0.5 ~0.6 30 Jun 2013 30 Sep p 2013 30 Jun 2013 30 Sep p 2013 30 Jun 2013 p 2013 30 Sep (1) Contingent liabilities, liabilitie
Slide 5: CRD4 – Common Equity Tier 1 capital and RWA development
CRD4 – Common Equity Tier 1 capital and RWA development Pro-forma Pro forma, fully loaded Common Equity Tier 1 capital RWA In EUR bn In EUR bn 10.0% 9.7% 36.5 0.0 366.7 35.3 1.2 1.0 0.3 364.9 (0.2) (0.3) (0.3) (0.1) (0 4) (0.4) (4 3) (4.3) 30 Jun Net Dividend Capital Equity Other FX 30 Sep 30 Jun FX
Slide 6: We remain committed to our 10% CET1 ratio target by 2015
We remain committed to our 10% CET1 ratio target by 2015 but expect some volatility along the way Regulatory framework volatility Inherent Capital / RWA volatility — Changes in DTA due to regional split of profit and loss, e.g. from — Final CRD4 regulation (including CRD4 corrigenda) not issued yet
Slide 7: EUR 200 bn CRD4 reduction until June 2013
EUR 200 bn CRD4 reduction until June 2013 CRD4 exposure, in EUR bn CRD4 gross-up X.X% Leverage ratio, adjusted — Total CRD4 exposure reduction of EUR ~200 bn, f ll lloaded fully d d including EUR ~40 bn of FX movements, movements already Total assets (adjusted)(1) achieved from 1 July 2012 to 30 Jun
Slide 8: Reduction of CRD4 exposure in 3Q2013
Reduction of CRD4 exposure in 3Q2013 CRD4 exposure, exposure in EUR bn CRD4 exposure reduction in 3Q2013 Composition of 3Q2013 reductions (net of FX) CRD4 gross-up FX Total assets (adjusted) Reductions (net of FX) NCOU (5) 1,583 de-risking(1) (28) Derivatives and Securities (36) (21) 413 1,519 Finan
Slide 9: Leverage Toolbox: CRD4 reduction roadmap and impact
Leverage Toolbox: CRD4 reduction roadmap and impact Reduction target Recurring IBIT One-off Jun 2013 – Implementation Achieved by impact from implementation Product category, in EUR bn Dec 2015 timeline 30 Sep 2013 2015, in EUR m costs, in EUR m By end NCOU d de-risking i ki (1) ~40 40 ~5 5 2015 Der
Slide 10: CRD4 exposure and leverage ratio simulation until 2015
CRD4 exposure and leverage ratio simulation until 2015 In EUR bn, bn period end CRD4 exposure Tier 1 capital Adjusted j fully y loaded Eligible AT1(1) 1,583 CRD4 leverage ratio (28) 1,519 (36) 3.0% 3.1% ~(214) ~1,305 49 1 49.1 47.8 46.5 2.5 5.0 11.3 11.3 13.8 36.5 35.3 35.3 Jun FX Reduction Sep Redu
Slide 11: Agenda
Agenda 1 Key current themes 2 Group p results 3 Segment results Deutsche Bank 3Q2013 results financial transparency. 11 Investor Relations 29 October 2013
Slide 12: Key Group financial highlights
Key Group financial highlights 9M2013 9M2012 Income before income taxes (in EUR bn) 3.2 4.0 Net income (in EUR bn) 2.0 2.8 Diluted EPS (in EUR) 1 99 1.99 2 92 2.92 Profitability Post-tax return on average active equity 4.9% 6.8% Cost / income ratio (reported) 82% 80% Cost / income ratio (based on ad
Slide 13: Net revenues
Net revenues In EUR bn 9.2 9.4 8.6 8.2 8.0 7.9 7.7 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2012 2013 Contribution to Group revenues ex Consolidation & Adjustments by business segment(1): CB&S 50% 42% 44% 42% 47% 44% 37% GTB 11% 13% 12% 14% 11% 12% 13% DeAWM 12% 12% 14% 14% 13% 12% 16% PBC 25% 29% 27% 30% 25% 29% 29% N
Slide 14: Provision for credit losses
Provision for credit losses In EUR m Non-Core Operations Unit Cost of Risk Deutsche Bank Group(1) Core Bank Cost of Risk Core Bank(1) Cost of Risk(1) 555 512 0.80% 473 418 434 0.70% 300 105 354 174 238 0 60% 0.60% 314 138 0.50% 87 0.46% 91 0.40% 0.30% 0.32% 328 267 299 274 0.20% 223 281 255 0.10% 1Q
Slide 15: Noninterest expenses
Noninterest expenses 10.6 In EUR bn 3.2 Compensation and 7.2 benefits 7.0 6.6 7.0 6.6 6.9 General and 3.3 3.2 2.9 administrative 36 3.6 34 3.4 53 5.3 35 3.5 expenses Other noninterest expenses(1) 3.2 3.6 4.1 3.2 3.3 2.8 (0.0) 0.4 2.1 0.2 0.3 0.2 0.2 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2012 2013 Compensation ratio
Slide 16: Progress on Operational Excellence Program
Progress on Operational Excellence Program Targeted CtA and savings Program to date progress In EUR bn In EUR bn CtA p per yyear Cumulative savings g 9M2013 I Invested/achieved t d/ hi d 2H2012 4.5 4.5 4.0 2014 target 2.9 2014 target 2013 target 1.7 1.6 1.5 1.5 2013 target 1.3 9M2013 0.8 1.1 9M2013
Slide 17: OpEx: How initiatives are progressing
OpEx: How initiatives are progressing 100% 97% EUR 1.5 bn savings already realized 74% across categories 40% Percent of 9% target 2015 Underlying savings, 4.5 bn 4.4 bn 3.3 bn 1.8 bn 0.4 bn in EUR Number of programs/ >165 ~165 165 ~120 120 ~55 55 ~5 5 initiatives Ideas Initiatives Initiatives Initia
Slide 18: Profitability
Profitability Income before income taxes Net income In EUR bn Adjusted IBIT(2) In EUR bn 2.4 19 1.9 1.7 1.1 1.4 1.0 0.8 0.7 0.8 0.3 0.0 0.3 0.1 (2.5) (3.2) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 2012 2013 2012 2013 Post-tax return on equity(1) Effective tax rate 10% 5% 5% (18)% 12% 2% 0% 25% 31%
Slide 19: Agenda
Agenda 1 Key current themes 2 Group p results 3 Segment results Deutsche Bank 3Q2013 results financial transparency. 19 Investor Relations 29 October 2013
Slide 20: Corporate Banking & Securities
Corporate Banking & Securities Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 Impairment p of g goodwill and other intangible g assets 3Q12 2Q13 Revenues (1) 2,936 3,947 3,666 (26)% (20)% 1,893 1,844 Prov. for credit (43) (18) (26) 135 % 69 % losses 1,088
Slide 21: Sales & Trading revenues
Sales & Trading revenues Revenues Key features Debt S&T, in EUR m Debt Sales & Trading — A slowdown in activityy and challenging g g conditions resulted in 3,168 significantly lower revenues vs. a record 3Q2012 2,729 — Rates & Credit trading revenues significantly lower y-o-y. Rates 2,462 2,135 in p
Slide 22: Origination & Advisory
Origination & Advisory Revenues Key features In EUR m Origination Overall 3Q13 3Q12 2Q13 9M2013 9M2012 Advisory — Revenues in line y-o-y y o y driven by stable revenues across all Revenues products 738 Prov. — Topfor credit 3 global leading debt origination business with increased 677 701 676 losses
Slide 23: Global Transaction Banking
Global Transaction Banking Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 Impairment p of g goodwill and other intangible g assets 3Q12 2Q13 Revenues 1,024 1,045 1,036 (2)% (1)% 379 Prov. for credit 309 283 323 318 323 losses (58) (39) (79) 48 % (27)% Noni
Slide 24: Deutsche Asset & Wealth Management
Deutsche Asset & Wealth Management Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 3Q12 2Q13 Impairment p of g goodwill and other intangible g assets 283 Revenues(1) 1,264 1,235 1,040 2% 22 % 207 221 Prov. for credit (1) (8) (0) (86)% n.m. 113 losses 96 82
Slide 25: Private & Business Clients
Private & Business Clients Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 3Q12 2Q13 Revenues 2,434 2,448 (5)% 483 507 2,323 (5)% 460 Prov. for credit (171) (189) (194) (9)% (12)% 404 losses 367 347 Noninterest exp. (1,805) (1,841) (1,747) (2)% 3% 287 IBIT
Slide 26: Private & Business Clients: Profit by business unit
Private & Business Clients: Profit by business unit Income before income taxes taxes, in EUR m Cost-to-Achieve(3) Private & Commercial Banking(1) Postbank(2) Advisory Banking International 28 32 63 11 22 42 59 41 19 1 5 51 51 233 49 25 53 40 204 177 204 149 182 161 155 137 118 126 131 117 139 123 12
Slide 27: Non-Core Operations Unit
Non-Core Operations Unit Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 Impairment p of g goodwill and other intangible g assets 3Q12 2Q13 (1,227)(5) Revenues 367 397 193 (8)% 90 % Prov. for credit (238) (300) (174) (21)% 37 % (218) (196) losses (549) (507
Slide 28: NCOU: De-risking since June 2012
NCOU: De-risking since June 2012 De-risking milestones since June 2012 Size of Non-Core Operations Unit — CRD4 RWA equivalent reduction > 50% and adjusted Adjusted assets(1), in EUR bn assets 46% lower. De-risking momentum maintained 120 — Significantly Si ifi tl ahead h d off D Dec 2013 ttargett of
Slide 29: 3Q2013 results: Key messages
3Q2013 results: Key messages Quarterly results affected by substantial litigation charges CB&S results driven by weak Debt Sales & Trading Good progress in DeAWM, GTB and PBC experiencing some revenue pressure EUR 36 bn of de-levering in the quarter, EUR 64 bn with FX movements C Committed i d to 10
Slide 30: Appendix
Deutsche Bank Appendix
Slide 31: Appendix: Table of Contents
Appendix: Table of Contents Balance sheet 32 Loan book 35 NCOU: Breakdown of adjusted assets 38 IAS 39 reclassified assets 39 Regulatory capital: CRD3 and reconciliation to CRD4 40 Private & Business Clients: Adjusted IBIT 43 Consolidation & Adjustments j 44 Value-at-Risk 45 Funding 46 Number of sha
Slide 32: Balance sheet: Reconciliation of reported (IFRS) to adjusted
Balance sheet: Reconciliation of reported (IFRS) to adjusted In EUR bn 2012 2013 31 M Mar 30 J Jun 30 S Sep 31 D Dec 31 M Mar 30 J Jun 30 S Sep Total assets (IFRS) 2,111 2,249 2,194 2,022 2,033 1,910 1,788 (1) Adjustment for additional derivatives netting (688) (782) (741) (705) (642) (571) (524) Ad
Slide 33: Total assets (adjusted)
Total assets (adjusted) In EUR bn Positive market values 1,170 1,122 from derivatives 70 post netting 57 Financial assets Trading securities 210 237 Trading assets 197 at FV through P&L 219 Trading assets Other trading assets 27 Reverse repos / 23 securities borrowed 136 128 Loans des. at FV 18 19 O
Slide 34: CRD3 – Balance sheet and risk weighted assets
CRD3 – Balance sheet and risk weighted assets XX RWA density incl. operational risk RWA(1) vs. balance sheet (adj. assets) XX RWA density excl. operational risk In EUR bn, as of 30 Sep 2013 ~28% 260 260 ~23% 1,122 , Avg RWA density Avg. Market Risk RWA 51 64 64 Non-derivative trading assets 56 ~26%
Slide 35: Loan book
Loan book In EUR bn 412 415 408 402 400 393 387 NCOU 63 58 54 50 43 3 34 32 DeAWM 28 30 29 30 30 31 31 PBC 208 209 211 209 211 211 214 GTB 69 71 69 70 75 77 72 CB&S 44 47 45 43 41 40 39 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 2012 2013 Germany excl. Financial Institutions and Public Sector:
Slide 36: Composition of loan book and provisions by category
Composition of loan book and provisions by category In EUR bn, bn as of 30 Sep 2013 Core Bank 512 3Q2013 provision for credit losses, in EUR m Non-Core Operations Unit 207 107 198 387 ― Low loan to value 32 (8) ― Mostly German domiciled ― Partially ― Highly hedged diversified― Mostly collate- ― Sub-
Slide 37: 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 4.50% 10.5 10.9 10.3 4.00% 9.8 10.1 9.7 9.3 3 50% 3.50% 44 4.4 3.8 4.2 4.0 3.7 3.5 3.2 3.00% 2.50% 2.51% 6.0 6.2 6 6.4 6.3 6.4 2 00% 2.00% 61
Slide 38: NCOU: Total adjusted assets
NCOU: Total adjusted assets Total adjusted assets(1) – 30 June 2013 Total adjusted assets(1) – 30 Sep 2013 In EUR bn In EUR bn AWM IAS 39 re- AWM IAS 39 re- classified classified CI assets assets 1.5 CI 1.3 15.4 17.0 11.7 10.8 14.4 13 7 13.7 Other Other PBC: Other 3.8 5.5 loans PBC: Other 4.2 7.3 5.
Slide 39: IAS 39 reclassified assets
IAS 39 reclassified assets Carrying Value vs. Fair Value 3Q2013 developments In EUR bn — The gap between carrying value and fair value has decreased by EUR 0.3 bn in 3Q2013 to a Dec Dec Dec Dec Mar Jun Sep historic low of EUR 0.6bn 2009 2010 2011 2012 2013 2013 2013 — Decrease of fair value by EUR 0
Slide 40: CRD3 – Common Equity Tier 1 capital and RWA development
CRD3 – Common Equity Tier 1 capital and RWA development Common Equity Tier 1 capital RWA In EUR bn In EUR bn 13.3% 13.0% 41.7 0.0 314.3 1.5 (0.2) 0.3 309.6 ((0.3)) (0.1) 40.3 ((3.0)) (0 1) (0.1) (0 1) (0.1) (3 4) (3.4) (0.5) 30 Jun Net Equity Actuarial Other FX 30 Sep 30 Jun FX effect Credit Market
Slide 41: CRD4 – CET1 ratio and risk-weighted assets
CRD4 – CET1 ratio and risk-weighted assets 10.0 9.7 8.8 CET1 ratio (B3 fully loaded), in % 7.8 401 380 367 365 RWA (Basel 3 fully loaded) loaded), in EUR bn 4Q 1Q 2Q 3Q 2012 2013 Note: N t Common E C Equity it Ti Tier 1 ratio ti = (Ti (Tier 1 capital it l - hybrid h b id Tier Ti 1 capital) it l) / R
Slide 42: RWA and CET1: Reconciliation of CRD3 to CRD4
RWA and CET1: Reconciliation of CRD3 to CRD4(1) In EUR bn, bn as per 30 Sep 2013 RWA Common Equity Tier 1 capital 13 0% 13.0% 14 6% 14.6% 9 7% 9.7% CRD4 phase-in CRD4 fully loaded CRD4 phase-in CRD4 fully loaded 61 371 365 2 54 11 310 ((6)) 40 35 (19) B 2.5 Incremental Total Incremental Total B 2.5
Slide 43: Private & Business Clients: Adjusted IBIT
Private & Business Clients: Adjusted IBIT In EUR m, m post post-minorities minorities 1Q2012 2Q2012 3Q2012 4Q2012 FY2012 1Q2013 2Q2013 3Q2013 Private & Reported IBIT 233 137 93 5 468 118 126 74 Commercial Cost-to-achieve (28) (42) (49) (149) (268) (51) (59) (53) (1) Banking Adjusted IBIT 260(4) 178
Slide 44: Consolidation & Adjustments
Consolidation & Adjustments Income before income taxes Key features In EUR m In EUR m 3Q13 vs. 3Q13 vs. 3Q13 3Q12 2Q13 3Q12 2Q13 IBIT (152) (293) (205) (48)% (26)% thereof V&T differences (1) (58) (273) (9) (79)% n.m. (73) Spreads for capital (76) (87) (3)% (85) 11 % instruments (152) (205) Bank lev
Slide 45: Value-at-Risk
Value-at-Risk DB Group, Group 99% 99%, 1 day day, in EUR m Average VaR Constant VaR(1) EUR 3.8 bn Sales & Trading revenues EUR 3.5 bn 120 100 80 60 40 20 56 60 59 55 48 30 33 32 31 25 3Q2012 4Q2012 1Q2012 2Q013 3Q2013 (1) Constant VaR is an approximation of how the VaR would have
Slide 46: Funding activities update
Funding activities update Funding cost development Observations In bps — Funding plan of up to EUR 18 bn for European Peer CDS(1) 360 US Peer CDS(2) 2013 fully completed DB 5yr Senior CDS 320 DB issuance spread(3) DB issuance volume — Issuance at EUR 15.2 bn for the first 280 nine months at average
Slide 47: Funding Profile
Funding Profile Funding well diversified Highlights 3Q2013 As of 30 September 2013 — Total funding liabilities slightly lower, mainly Financing Vehicles in discretionary wholesale and secured 2% 65% from most stable funding and shorts funding sources Secured Funding Capital Markets — Most stable fun
Slide 48: Number of shares
Number of shares In million Average used for EPS calculation End of period numbers 31 Dec 31 Dec 30 Sep FY2011 FY2012 3Q2013 2011 2012 2013 Common shares issued 929 929 1,019 929 929 1,019 Total shares in treasury (17) (9) (4) (25) 0 0 Common shares outstanding 913 921 1,015 905 929 1,019 Vested sha
Slide 49: Regional invested assets – DeAWM
Regional invested assets – DeAWM In EUR bn 30 Sep 2013 30 Sep 2013 30 Sep 2012 31 Dec 2012 31 Mar 2013 30 Jun 2013 30 Sep 2013 vs. vs. 30 Jun 2013 30 Sep 2012 Americas 276 277 291 281 267 (14) (9) A i P Asia Pacific ifi 54 55 58 54 55 1 1 EMEA excl. Germany 272 280 286 281 287 6 15 Germany 320 317 3
Slide 50: Invested assets – PBC
Invested assets – PBC In EUR bn 30 Sep 2013 30 Sep 2013 30 Sep 2012 31 Dec 2012 31 Mar 2013 30 Jun 2013 30 Sep 2013 vs. vs. 30 Jun 2013 30 Sep 2012 Private & Business Clients 297 293 290 285 285 0 (11) I Investment t t & Insurance I Products P d t 138 139 142 141 143 2 5 Deposits excl. Sight Deposit
Slide 51: Group headcount
Group headcount Full-time Full time equivalents equivalents, at period end 30 Sep 2013 vs. vs. 30 Jun 31 Dec 30 Jun 30 Sep 30 Jun 30 Jun 2012 2012 2013 2013 2013 2012 CB&S 9,353 8,650 8,213 8,577 365 (776) GTB 4,292 4,315 4,196 4,184 (13) (108) DeAWM 6,896 6,450 6,243 6,246 3 (650) PBC 40,534 39,678
Slide 52: 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