Commerzbank Ag · XETR:CBK
Commerzbank — FY2015 Earnings Presentation
47 slides from Commerzbank's earnings presentation, Feb 12, 2016
Slide 1: Commerzbank 2015: More than 1 billion net profit − successful execution of strategy
Commerzbank 2015: More than 1 billion net profit − successful execution of strategy Analyst conference – Q4 2015 / FY 2015 preliminary and unaudited results Stephan Engels | CFO | Frankfurt | 12 February 2016
Slide 2: More than 1 billion net profit − successful execution of strategy
More than 1 billion net profit − successful execution of strategy Significantly increased earnings – strategy pays off › Sound operating result of €1.9bn and net income of €1.1bn › Operating RoTE of 7.3% and net RoTE of 4.2% › Earnings per share of €0.88 Strengthened capital ratio – proposal for div
Slide 3: Strong market position in Core Bank divisions − PC strategy has kicked in
Strong market position in Core Bank divisions − PC strategy has kicked in Central & Eastern Corporates & Private Customers Mittelstandsbank Europe Markets › NPS far above ambition › Loan volumes › mBank serving ~5m › No.1 European market for 2016 (54% vs. 30%) increased by 12% customers (+9% vs. mak
Slide 4: Key financial figures at a glance
Key financial figures at a glance Operating profit Core Bank Operating profit Group Net profit Group1) 2,310 result (€m) 1,813 1,909 1,504 Financial 1,062 731 689 81 266 FY 13 FY 14 FY 15 FY 13 FY 14 FY 15 FY 13 FY 14 FY 15 B3 CET1 ratio fully phased-in Leverage ratio3) Total capital ratio fully pha
Slide 5: Operating result of Commerzbank divisions at a glance
Operating result of Commerzbank divisions at a glance Private Customers (€m) Mittelstandsbank (€m) Central & Eastern Europe (€m) 1,118 1,224 1,062 751 455 364 346 221 260 FY 13 FY 14 FY 15 FY 13 FY 14 FY 15 FY 13 FY 14 FY 15 Corporates & Markets (€m) Others & Consolidation (€m) Non-Core Assets (€m)
Slide 6: Group financials show significant increase in a challenging environment
Group financials show significant increase in a challenging environment Group Operating result (€m) Group P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Revenues 1,848 2,309 2,232 8,762 9,762 LLP -308 -146 -112 -1,144 -696 670 Costs 1,800 1,719 1,744 6,929 7,157 419 444 Operating result -260 444
Slide 7: Expenses managed flat − increase solely due to European bank levy and FX effects
Expenses managed flat − increase solely due to European bank levy and FX effects Costs, Group (€m) 7,157 6,929 204 1,957 1,692 1,721 1,716 1,800 1,737 1,719 1,744 6,953 958 984 976 950 959 981 967 968 716 771 757 842 973 756 752 776 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 2014 FY 2015 2014 Personnel expenses 201
Slide 8: LLPs of €0.7bn prove high quality of loan book in a benign environment
LLPs of €0.7bn prove high quality of loan book in a benign environment and successful asset run down in NCA Provisions for loan losses, Group (€m) 1,144 341 308 654 696 280 238 257 64 251 205 142 366 158 146 134 112 193 97 74 490 138 53 330 104 90 103 61 72 59 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 2014 FY 2015
Slide 9: Core Bank: 2015 with operating RoTE of 12.3% and net RoTE of 9.4%
Core Bank: 2015 with operating RoTE of 12.3% and net RoTE of 9.4% Core Bank Operating result (€m) Core Bank P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Revenues 1,762 2,161 2,197 8,614 9,504 761 o/w Net int. & trad. income 1,349 1,358 1,224 5,759 5,789 674 608 o/w Net commission income 817 82
Slide 10: Private Customers: Visible growth in customers, assets and revenues
Private Customers: Visible growth in customers, assets and revenues – operating result increased by 65% in FY 2015 Operating result (€m) Segmental P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Revenues 842 977 894 3,453 3,718 o/w Filialbank 718 847 730 2,943 3,152 240 o/w Direct Banking 92 94 8
Slide 11: Mittelstandsbank: Continues to generate solid results in a challenging interest rate environment
Mittelstandsbank: Continues to generate solid results in a challenging interest rate environment Operating result2) (€m) Segmental P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 2) Revenues 731 621 679 2,927 2,723 371 o/w Mittelstand Germany 363 344 342 1,466 1,375 337 325 269 o/w Large Corp. &
Slide 12: Central & Eastern Europe: Growth story continues in an increasingly challenging environment
Central & Eastern Europe: Growth story continues in an increasingly challenging environment Operating result (€m) Segmental P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Revenues 225 228 251 923 941 LLP -27 -28 -22 -123 -97 98 101 Costs 109 99 148 436 498 93 89 92 84 81 72 Operating result 89 1
Slide 13: Corporates & Markets: Again ~€2bn revenues despite headwinds in H2
Corporates & Markets: Again ~€2bn revenues despite headwinds in H2 Operating result2) (€m) Segmental P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 2) Revenues 475 371 419 1,991 1,900 255 o/w Corporate Finance 150 97 198 574 545 202 193 o/w EMC 91 91 48 592 595 148 150 143 o/w FIC 80 88 92 440 4
Slide 14: NPL ratio & Cost of Risk in Core Bank at all time lows
NPL ratio & Cost of Risk in Core Bank at all time lows NPL ratio1) in Core Bank (%) Cost of Risk2) in Core Bank (bps) 1.8 20 1.6 1.3 14 9 YE 2013 YE 2014 YE 2015 FY 2013 FY 2014 FY 2015 PC 1.1 0.8 0.6 PC 13 9 1 MSB 2.2 1.9 1.7 MSB 38 25 14 CEE 4.0 4.5 3.8 CEE 42 45 33 C&M 2.0 1.6 1.1 C&M - - - O&C 0
Slide 15: NCA: Full year losses halved − 2015 with €0.4bn net capital release
NCA: Full year losses halved − 2015 with €0.4bn net capital release Operating result (€m) Segmental P&L in € m Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Revenues 86 148 35 148 258 6 LLP -205 -74 -53 -654 -366 Costs 70 68 43 309 293 -61 Operating result -189 6 -61 -815 -401 -91 CIR (%) 81.4 45.9 122.9
Slide 16: NCA target for CRE and Ship Finance of €20bn by year-end already achieved
NCA target for CRE and Ship Finance of €20bn by year-end 2016 already achieved EaD1) (€bn) LLP (€m) NPL (€bn) 36 Commercial Real Estate 491 20 10 73 57 6 3 1 YE 2013 YE 2014 YE 2015 FY 2013 FY 2014 FY 2015 YE 2013 YE 2014 YE 2015 EaD1) (€bn) LLP (€m) NPL (€bn) 596 588 311 Finance 14 12 8 4 3 Ship 1
Slide 17: Significant RWA reduction to less than €200bn lifts CET1 ratio by 90bps
Significant RWA reduction to less than €200bn lifts CET1 ratio by 90bps RWA (B3 fully phased-in) development RWA (B3 fully phased-in) development by segmental split (€bn) by RWA classification (€bn) 218 217 215 214 222 214 213 218 217 215 214 222 214 213 197 20 22 20 20 22 20 197 45 41 20 57 52 47 4
Slide 18: CET1 ratio fully phased-in increased to 12.0%
CET1 ratio fully phased-in increased to 12.0% Regulatory capital (CET1 B3 fully phased-in) transition (€bn) 9.3% 10.8% 12.0%1) 23.7 23.1 0.0 0.5 0.2 0.1 0.0 0.0 19.9 Regulatory Regulatory Net profit Dividend accrual Actuarial Currency Revaluation Others2) Regulatory Capital Capital gains/losses tran
Slide 19: Capital ratios well above SREP requirement
Capital ratios well above SREP requirement Capital ratios vs. SREP requirements (phase-in %) Capital ratio vs. estimated requirements (fully phased-in %) 13.8 13.5 12.0 11.75 10.25 1.50 O-SII estimate 10.25 CET1 ratio CET1 ratio SREP CET1 ratio SREP+O-SII phase-in phase-in requirement fully phased-i
Slide 20: Refined management focus going forward − changes in structure and management accounts
Refined management focus going forward − changes in structure and management accounts to be reflected from Q1 2016 onwards Full focus in non-core on more challenging portfolios – others to be transferred to Core Bank › Transfer of NCA assets with low credit risk, manageable P&L volatility, central b
Slide 21: After stringent selection criteria more than two-thirds of NCA assets will qualify for transfer
After application of stringent selection criteria more than two-thirds of NCA assets will qualify for transfer to core segments1) Criteria for portfolio transfer EaD (as of YE 2015, €bn) 10 ~7 PC ~2 Com. › Exclusively performing loans mainly Germany MSB ~5 ~3 Real › High rating classes Estate › Rema
Slide 22: New ACR is ring-fenced with sufficient equity capital even under stress
New ACR is ring-fenced with sufficient equity capital even under stress – we aim for significant capital relief over time ~€18bn EaD with ~€23bn RWA to remain in ACR CRE and Ship Finance with combined EaD run-down to low single digit billion exposure by year-end 2019 Expected cumulated operating los
Slide 23: Sound risk profile and significantly improved returns on a substantially increased capital base
Sound risk profile and significantly improved returns on a substantially increased capital base Substantial achievements despite significant Targets headwinds from the low and negative interest FY 2014 FY 2015 2016 rate environment and regulatory requirements Basel 3 CET1 9.3% 12.0%1) > 10% (fully p
Slide 24: Financial outlook 2016 in an overall challenging macro environment
Financial outlook 2016 in an overall challenging macro environment We pursue our strategy and aim to further increase market share in our core bank divisions We aim to keep our cost base stable with exception of additional external burdens We expect a moderate increase in loan loss provisions due to
Slide 25: Appendix
Appendix Stephan Engels | CFO | Frankfurt | 12 February 2016 24
Slide 26: German economy 2016/2017 – mounting headwinds for the economy
German economy 2016/2017 – mounting headwinds for the economy Current development Our expectation for 2016/2017 Mounting headwinds from EM › The recovery of the German economy is › Recovery will continue as the lower oil › 40% of German exports go to EM, of going on with moderate speed. price and th
Slide 27: Key figures of Commerzbank share
Key figures of Commerzbank share Figures per share (€) Operating result EPS 1.58 0.88 0.80 0.61 0.23 0.09 FY 2013 FY 2014 FY 2015 ytd as of 31 Dec 2013 31 Dec 2014 31 Dec 2015 Number of shares issued (in m) 1,138.5 1,138.5 1,252.4 Market capitalisation (in €bn) 13.3 12.5 11.8 Net asset value per sha
Slide 28: Commerzbank financials at a glance
Commerzbank financials at a glance Group Q4 2014 Q3 2015 Q4 2015 FY 2014 FY 2015 Operating result (€m) -260 444 376 689 1,909 Net result (€m) -280 230 187 1) 266 1,062 1) CET1 ratio B3 phase-in (%) 11.7 12.5 13.8 2) 11.7 13.8 2) CET1 ratio B3 fully phased-in (%) 9.3 10.8 12.0 2) 9.3 12.0 2) Total as
Slide 29: Leverage ratio increased to 4.5% fully phased-in
Leverage ratio increased to 4.5% fully phased-in Total assets and LR exposure (€bn) Leverage ratio fully phased-in1) as of Q4 2015 (%) Total assets LR exposure 558 568 568 4.5 548 533 529 4.1 3.6 Q4 2014 Q3 2015 Q4 2015 Q4 2014 Q3 2015 Q4 20152) Note: Numbers may not add up due to rounding Stephan E
Slide 30: Hedging & Valuation adjustments
Hedging & Valuation adjustments €m Q1 14 Q2 14 Q3 14 Q4 14 FY 14 Q1 15 Q2 15 Q3 15 Q4 15 FY 15 PC OCS, FVA & Net CVA/DVA - - - - - - - - - - MSB OCS, FVA & Net CVA/DVA 2 14 -6 -9 1 17 24 -22 -18 2 CEE OCS, FVA & Net CVA/DVA - -1 - - -2 1 1 2 -2 2 OCS -5 -27 15 -40 -56 7 39 57 -32 71 C&M FVA & Net CV
Slide 31: Oil/gas exposure stands for <1% of total exposure – >75% investment grade
Oil/gas exposure stands for <1% of total exposure – >75% investment grade Oil/gas exposure (year-end 2015, €bn) Notes 21% Integrated oil & gas majors by company 29% Integrated Tier II operators1) total Upstream 13% €3.9bn Mid-/downstream › Roughly 60% of the exposure to integrated oil & types Servic
Slide 32: Capital markets funding activities (as of full year 2015)
Capital markets funding activities (as of full year 2015) Funding strategy Capital market funding structure as of 31 December 20151) Promissory notes › Commerzbank uses covered bonds (Pfandbriefe) and 15% senior unsecured instruments for funding purposes › Funding via private placements and public t
Slide 33: Current Commerzbank Bank- and Covered Bond Ratings
Current Commerzbank Bank- and Covered Bond Ratings Rating overview Commerzbank Bank Ratings Counterparty Risk Assessment - A2 - Deposit Rating - A2 stable - Issuer Rating BBB+ negative Baa1 stable BBB positive Financial Strength (stand-alone) bbb baa3 bbb Short-term debt A-2 P-1 F2 Covered Bond Rati
Slide 34: NCA: Diversified portfolio EaD (incl. NPL) per year-end 2015
NCA: Diversified portfolio EaD (incl. NPL) per year-end 2015 (€bn) GER USA IT POR Rest Sum Com. Performing 5.5 0.1 0.7 1.2 1.7 9.2 EaD RWA Real NPL2) 0.9 0.0 0.0 0.0 0.1 1.1 10.3 8.8 Estate Sum 6.4 0.1 0.7 1.2 1.8 10.3 GER USA IT ES POR Rest Sum FI 1.1 0.3 0.1 1.9 0.0 2.6 6.0 Public Sovereign3) 4.7
Slide 35: Default portfolios CRE and Ship Finance as of 31 December 2015
Default portfolios CRE and Ship Finance as of 31 December 2015 31 December 2015 (31 Dec 2014) 31 Dec 2013 Default portfolio CRE by country | €m Total Germany Total Default volume 1,102 (3,335) 920 (1,796) 5,662 Loan loss provisions 213 (900) 145 (508) 1,882 GLLP 58 (80) 14 (1) 119 Coverage ratio inc
Slide 36: Commerzbank Group
Commerzbank Group Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 2,261 2,245 2,408 1,848 8,762 2,785 2,436 2,309 2,232 9,762 20.8 11.4 o/w Total net interest and net trading income 1,526 1,415 1,584 1,428 5,953 2,005 1,511 1,48
Slide 37: Core Bank
Core Bank Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 2,225 2,290 2,337 1,762 8,614 2,674 2,472 2,161 2,197 9,504 24.7 10.3 o/w Total net interest and net trading income 1,412 1,495 1,503 1,349 5,759 1,704 1,503 1,358 1,224
Slide 38: Private Customers
Private Customers Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 883 855 873 842 3,453 923 924 977 894 3,718 6.2 7.7 o/w Net interest income 445 475 463 460 1,843 429 462 535 450 1,876 -2.2 1.8 o/w Net trading income 1 - - 1 2
Slide 39: Mittelstandsbank
Mittelstandsbank Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 719 742 745 722 2,928 760 705 599 661 2,725 -8.4 -6.9 o/w Net interest income 439 451 456 456 1,802 444 423 404 404 1,675 -11.4 -7.0 o/w Net trading income 4 14 -7
Slide 40: Central & Eastern Europe
Central & Eastern Europe Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 224 233 241 225 923 254 208 228 251 941 11.6 2.0 o/w Net interest income 132 150 157 146 585 135 133 145 153 566 4.8 -3.2 o/w Net trading income 24 25 22 1
Slide 41: Corporates & Markets
Corporates & Markets Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 541 503 484 444 1,972 667 531 416 386 2,000 -13.1 1.4 o/w Total net interest and net trading income 464 403 368 325 1,560 571 407 345 226 1,549 -30.5 -0.7 o/w
Slide 42: Non-Core Assets
Non-Core Assets Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues 36 -45 71 86 148 111 -36 148 35 258 -59.3 74.3 o/w Net interest income 59 -115 16 40 - 149 17 -26 30 170 -25.0 >100 o/w Net trading income 55 35 65 39 194 152 -9 15
Slide 43: Others & Consolidation
Others & Consolidation Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY % Q4 % FY €m 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 vs Q4 vs FY Total Revenues -142 -43 -6 -471 -662 70 104 -59 5 120 >100 >100 o/w Total net interest and net trading income -97 -23 44 -37 -113 79 22 -78 -10 13 73.0 >100 o/w Net commiss
Slide 44: Group equity composition
Group equity composition Capital Capital Capital Ratios Ratios Ratios Q3 2015 Q4 2015 Q4 2015 Q4 2015 FY 2015 Dec 2015 End of period End of period Average €bn €bn €bn % % % 4) Common equity tier 1 B3 capital (phase in) 26.8 27.4 CET1 ratio phase-in: 13.8% 1) Transition adjustments 3.7 3.6 Common e
Slide 45: Glossary - Capital Allocation / RoE & RoTE Calculation
Glossary - Capital Allocation / RoE & RoTE Calculation › Amount of average capital allocated to business segments is calculated by multiplying the segments current YTD average Basel 3 RWA (phase-in) (PC €26.5bn, MSB €70.6bn, CEE €15.4bn, C&M €37.4bn, O&C €24.0bn, NCA €42.7bn) by a ratio of 10% - ref
Slide 46: Disclaimer
Disclaimer Investor Relations This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts; they include, inter alia, statements about Commerzbank’s beliefs and expectations and the assumptions underlying them. These statements are ba
Slide 47: For more information, please contact Commerzbank's IR team
For more information, please contact Commerzbank’s IR team Tanja Birkholz (Head of Investor Relations / Executive Management Board Member) P: +49 69 136 23854 M: tanja.birkholz@commerzbank.com Christoph Wortig (Head of IR Communications) P: +49 69 136 52668 M: christoph.wortig@commerzbank.com Instit