Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Q4 2007 Earnings Presentation
40 slides from Deutsche Bank's earnings presentation, Feb 7, 2008
Slide 1: 4Q2007 Results
4Q2007 Results Anthony di Iorio Chief Financial Officer 7 February 2008
Slide 2: Agenda
Agenda 1 Group results 2 Segment results 3 Risk and capital management Investor Relations 02/08 · 2
Slide 3: Pre-tax profits of EUR 1.4 bn in 4Q, EUR 8.7 bn for the year
Pre-tax profits of EUR 1.4 bn in 4Q, EUR 8.7 bn for the year Income before income taxes, in EUR bn 5% (25)% 8.7 8.3 3.2 2.6 2.7 2.0 1.9 1.8 1.4 1.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 2006 2007 2006 2007 Investor Relations 02/08 · 3
Slide 4: Net income of EUR 1.0 bn in the fourth quarter
Net income of EUR 1.0 bn in the fourth quarter In EUR bn Significant tax 7% effects* (47)% 6.5 2.1 6.1 1.8 1.8 1.6 1.6 1.4 0.4 1.2 0.6 1.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 2006 2007 2006 2007 * 4Q2006 reflects corporate tax credits, 3Q2007 reflects the effects of German tax reform, utilisation of c
Slide 5: Net revenues comparable to 4Q2006
Net revenues comparable to 4Q2006 In EUR bn 8% 2% 30.7 28.5 9.6 8.8 8.0 6.9 7.2 7.3 6.4 5.1 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 2006 2007 2006 2007 Investor Relations 02/08 · 5
Slide 6: Compensation expenses in line with performance; G&A expenses consistent with run-rate
Compensation expenses in line with performance; G&A expenses consistent with effective run-rate for 2Q / 3Q2007 Noninterest expenses, in EUR bn 8% 8% 21.4 6.3 19.9 6.0 5.5 5.4 5.1 4.8 4.5 13.1 4.3 3.5 3.2 12.5 3.6 3.1 3.9 3.0 2.7 1.7 1.9 2.1 7.1 8.0 1.7 1.7 1.9 2.1 1.7 1.8 0.1 0.1 0.1 0.1 0.2 0.3 0.
Slide 7: Key cost ratios consistent with 2006
Key cost ratios consistent with 2006 In % Cost / income ratio(1) 67 69 71 71 66 68 69 76 70 70 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 2006 2007 2006 2007 Compensation ratio(2) Non-compensation ratio(3) 45 44 43 43 45 44 44 44 43 36 32 33 22 26 28 29 21 24 26 27 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 1Q 2Q 3Q
Slide 8: Agenda
Agenda 1 Group results 2 Segment results 3 Risk and capital management Investor Relations 02/08 · 8
Slide 9: 'Stable' businesses contributed EUR 3 bn pre-tax in 2007
GTB ‘Stable’ businesses contributed EUR 3 bn pre-tax in 2007 AWM Income before income taxes PBC 2003 – 2007 Quarterly trend In EUR bn In EUR m >2x 835 832 3.0 2.6 717 694 694 616 613 643 1.9 1.6 1.4 AWM: Incl. impairment of intangibles of EUR 74 m 2003* 2004 2005 2006 2007 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q *
Slide 10: CB&S: Return to profitability in 4Q
CB&S: Return to profitability in 4Q Results at a glance Condensed P&L Income before income taxes, in EUR m In EUR m Key ratios, in % 4Q Δ vs. FY Δ vs. (57)% 2007 4Q2006 2007 FY2006 2,181 1,977 Revenues 3,816 (1)% 16,507 (0)% 1,752 1,345 Provisions* (182) n.m. (102) n.m. 1,0271,030 Noninterest exp. (
Slide 11: S&T debt: Sharp recovery from third quarter
S&T debt: Sharp recovery from third quarter S&T (debt and other products) Trends vs. 4Q2006 / key features Net revenues, in EUR m FX & Money Continued strong performance Markets (10)% Record 4Q in revenues / customer volumes 3,354 Scalable platform captures increase in customer volumes 2,806 2
Slide 12: S&T equity: Growth in derivatives and prime services
S&T equity: Growth in derivatives and prime services S&T (equity) Trends vs. 4Q2006 / key features Net revenues, in EUR m Equity Continued strong performance in retail 1% Derivatives structured products, particularly in Europe 1,714 Lower volumes in institutional flow 1,546 1,403 Prime Services
Slide 13: Origination & Advisory: A record quarter in Advisory
Origination & Advisory: A record quarter in Advisory Origination & Advisory Trends vs. 4Q2006 / key features Net revenues, in EUR m Advisory Advisory Best quarter ever Origination Full year transaction volume substantially up vs. 2006 (2)% Improved market share rank globally and in each region
Slide 14: Leveraged finance: Current status
Leveraged finance: Current status Composition of current commitments In EUR bn 30 Sep 2007 total commitments 41.4 FX (1.5) Sales (5.1) Restructured 0.2 Funded 15.3 Trading 34.9 New commitments 1.2 31 Dec 2007 total commitments 36.2 Unfunded 20.9 Loans held 1.3 Development of write-downs Expected fun
Slide 15: GTB: A record year
GTB: A record year Results at a glance Condensed P&L Income before income taxes, in EUR m In EUR m Key ratios, in % 4Q Δ vs. FY Δ vs. 2007 4Q2006 2007 FY2006 45% Revenues 12% 16% 247 263 657 2,585 214 222 182 199 170 153 Provisions* (8) n.m. (7) n.m. Noninterest exp. (427) (1)% (1,633) 5% IBIT 222 4
Slide 16: AWM: Fourth quarter P&L affected by specific items
AWM: Fourth quarter P&L affected by specific items Results at a glance Condensed P&L Income before income taxes, in EUR m In EUR m Key ratios, in % Impairment 4Q Δ vs. FY Δ vs. of intangibles 2007 4Q2006 2007 FY2006 (29)% 292 Revenues 1,101 (3)% 4,374 5% 265 233 242 237 Provisions* 0 n.m. (1) n.m. 1
Slide 17: PBC: Fourth quarter up 13% year-on-year
PBC: Fourth quarter up 13% year-on-year Results at a glance Condensed P&L Income before income taxes, in EUR m In EUR m Key ratios, in % 4Q Δ vs. FY Δ vs. 2007 4Q2006 2007 FY2006 13% Revenues 1,446 8% 5,755 12% 301 293 297 304 252 264 252 Provisions* (136) 28% (501) 28% 223 Noninterest exp. (1,058)
Slide 18: A record year for net money inflows in PCAM
A record year for net money inflows in PCAM In EUR bn 13 59 5 17 3 PBC 5 19 4 1 14 12 13 PWM 3 5 15 6 7 27 AM 4 4 1Q2007 2Q2007 3Q2007 4Q2007 FY2007 Note: Figures may not add up due to rounding differences Investor Relations 02/08 · 18
Slide 19: Agenda
Agenda 1 Group results 2 Segment results 3 Risk and capital management Investor Relations 02/08 · 19
Slide 20: Provisions: Rise in 4Q primarily driven by single counterparty relationship
Provisions: Rise in 4Q primarily driven by single counterparty relationship Provision for credit losses, in EUR m 612 329 298 131 98 105 82 76 81 9 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Full year 2006 2007 2006 2007 Thereof: CIB (72) (19) (27) 24 (20) (42) (19) 190 (94) 109 85 94 104 107 117 124 124 136 391 501 T
Slide 21: Slight increase in problem loans
Slight increase in problem loans Problem loans not considered Problem loans, in EUR bn impaired under IFRS IFRS impaired loans(1) IFRS impaired loans coverage ratio(2) 3.5 3.4 3.4 3.2 3.1 3.1 2.9 2.8 2.9 2.8 2.7 2.7 2.6 2.5 2.6 2.4 61% 61% 63% 66% 64% 64% 59% 60% 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 3
Slide 22: A year of substantial capital formation
A year of substantial capital formation At year end Total shareholders’ equity Book value per share* Tier 1 capital In EUR bn In EUR In EUR bn 13% 12% 20% 37.0 77.54 28.3 32.8 69.48 23.5 2006 2007 2006 2007 2006 2007 * Book value per share is defined as shareholders’ equity divided by the number of
Slide 23: Capital discipline: Strong Tier I ratio despite RWA growth
Capital discipline: Strong Tier I ratio despite RWA growth Basel I 8.8 8.7 8.9 8.7 8.8 8.6 8.5 8.4 8.6 9% Target range 328 8% 308 311 285 271 275 256 263 Tier I ratio, in % RWA, 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec in EUR bn 2006 2007 Note: March, June and September 2006 based on
Slide 24: Summary: Solid results in a challenging environment
Summary: Solid results in a challenging environment 4Q2007 FY2007 EUR EUR Revenues Revenues 2% 7.3 bn 8% 30.7 bn Income before EUR Income before EUR income taxes (25)% 1.4 bn income taxes 5% 8.7 bn EUR EUR Net income Net income (47)% 1.0 bn 7% 6.5 bn No net write-downs related to sub-prime / Pro
Slide 25: Additional information
financial Additional information A Passion to Perform. Deutsche Bank
Slide 26: Number of shares for EPS calculation
Number of shares for EPS calculation In million Average At end of period FY FY 4Q 31 Dec 30 Sep 31 Dec 2006 2007 2007 2006 2007 2007 Common shares issued 522 527 529 525 528 530 Total shares in treasury (22) (28) (30) (26) (29) (29) Common shares outstanding 500 499 500 499 499 501 (1) Forward purch
Slide 27: Group headcount
Group headcount Full-time equivalents, at period end 31 Dec 2007 vs. 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 31 Dec 2006 2006 2007 2007 2007 2007 Net of Total change de-/consoli- dation CIB 14,364 16,295 16,610 17,174 16,485 2,121 462 PCAM 28,362 29,437 29,877 30,577 30,805 2,443 1,942 Corporate 38 29 26
Slide 28: Invested assets report
Invested assets(1) report In EUR bn 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec Net new money 2006 2007 2007 2007 2007 4Q2007 FY2007 Asset and Wealth Management 732 747 765 759 749 8 40 Asset Management 543 553 564 561 555 5 27 Institutional 152 153 159 159 161 5 16 Retail 236 242 246 240 235 1 4 Alternative
Slide 29: Regional invested assets – AM and PWM
Regional invested assets(1) – AM and PWM In EUR bn 31 Dec 07 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec vs. 2006 2007 2007 2007 2007 31 Dec 06 Asset Management 543 553 564 561 555 2% Germany 238 249 265 265 264 11 % UK 10 12 13 17 17 74 % Rest of Europe 48 45 40 36 36 (24)% Americas 217 216 217 212 206 (5)%
Slide 30: Regional net new money – AM and PWM
Regional net new money – AM and PWM In EUR bn 4Q2006 FY2006 1Q2007 2Q2007 3Q2007 4Q2007 FY2007 Asset Management (0) 6 4 6 12 5 27 Germany (3) 5 8 11 (0) 1 20 UK 1 1 1 1 4 1 7 Rest of Europe (2) (4) (3) (6) 1 1 (7) Americas 3 0 (3) 1 4 1 3 Asia / Pacific 1 4 1 (1) 3 1 4 Thereof: business sold* (1) (4
Slide 31: Corporate Investments
Corporate Investments Results at a glance Condensed P&L (reported) Income before income taxes, in EUR m In EUR m 4Q Δ vs. FY Δ vs. 629 2007 4Q2006 2007 FY2006 Revenues 165 (1)% 1,517 164% 305 Provisions* (3) n.m. (3) 37% 233 127 109 133 Noninterest exp. (29) (68)% (220) 3% 80 45 IBIT 133 67% 1,299 n
Slide 32: Alternative assets exposure
Alternative assets exposure Book values, in EUR bn CI - Private Equity funds 3.9 3.7 0.0 CI - Private Equity directs 0.0 0.3 0.3 CI - Real Estate 0.3 0.3 2.6 2.7 2.6 2.5 2.5 2.4 0.2 0.2 0.1 0.4 0.3 0.3 0.1 0.3 1.9 0.4 0.3 PCAM 0.4 0.3 0.3 1.9 0.6 0.4 0.4 0.4 0.4 1.0 1.0 1.0 0.9 0.9 1.0 1.4 0.9 1.1 C
Slide 33: Listed holdings: Unrealised net gains of EUR 3.0 bn
Listed holdings: Unrealised net gains of EUR 3.0 bn In EUR m Stake Market value (in %) 31 Dec 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 2007 2006 2007 2007 2007 2007 Daimler AG 4.4% 2,103 2,766 3,058 3,170 2,967 Allianz SE 1.7% 1,494 1,485 1,665 1,277 1,154 Linde AG 5.2% 983 1,010 1,114 929 789 Other n.m.
Slide 34: February 2008 equity grants
February 2008 equity grants In February 2008, around 14 m shares with a total value of approximately EUR 1.0 bn will be awarded. Background Proportion of equity grants in percent of total bonus immaterially changed vs. grant in February 2007 Compensation model aims to maintain a balance between
Slide 35: Loan book
Loan book In EUR bn 12% 190 193 195 203 179 180 186 CI/Other 173 97 97 102 CIB 92 101 89 91 87 85 86 88 90 94 96 98 100 PCAM 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 2006 2007 Note: Figures may not add up due to rounding differences Investor Relations 02/08 · 35
Slide 36: Risk
Risk VaR of CIB trading units (99%, 1 day), in EUR m Sales & Trading revenues EUR 2.8 bn EUR 2.7 bn 120 110 100 90 80 70 60 50 ∅ 68.2 ∅ 67.6 ∅ 69.3 ∅ 72.9 ∅ 77.5 ∅ 83.6 ∅ 90.5 ∅ 91.0 1Q2006 2Q2006 3Q2006 4Q2006 1Q2007 2Q2007 3Q2007 4Q2007 Investor Relations 02/08 · 36
Slide 37: Update on share buybacks
Update on share buybacks Total Total repurchases 3.3 m 5.8 m 1.4 m 0.9 m 11.3 m In % of shares issued* 0.6 % 1.1 % 0.3 % 0.2 % 2.1 % Capital consumption EUR 0.3 bn EUR 0.6 bn EUR 0.1 bn EUR 0.1 bn EUR 1.2 bn Share Share price, in EUR Number of shares, in ‘000 buybacks 120 2,500 110 Weekly 2,000 repu
Slide 38: Our target definition
Our target definition Pre-tax return on equity (target definition) IBIT attributable to DB shareholders (target definition) IBIT attributable to DB shareholders (target definition) Reported income before income tax expense Less minority interest Average active equity IBIT attributable to DB sharehol
Slide 39: Items excluded in target definition
Items excluded in target definition 2006 2007 In EUR m Pre-tax Post-tax Pre-tax Post-tax First quarter 131 131 First quarter 252 197 Gains from sale of the holding Gains from the sale of FIAT 128 126 in Eurohypo 131 131 shares Equity pick-up from Interhotel 178 125 Goodwill impairment (54) (54) Seco
Slide 40: Cautionary statements
Cautionary statements Unless otherwise indicated, the financial information provided herein has been prepared under the International Financial Reporting Standards (IFRS). It may be subject to adjustments based on the preparation of the full set of financial statements for 2007. This presentation al