2Q2011 Results Stefan Krause

Deutsche Bank
2Q2011 Results
Stefan Krause
Chief Financial Officer
Analyst
a yst Ca
Call,, 26
6 July
Ju y 2011
0
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
Key take-aways
—
CIB performance reflects challenging market conditions: macro concerns depressed flow trading client
volumes, particularly in June. Integra remains well on track to deliver EUR 500 m IBIT
—
PCAM growth trajectory remains intact: all businesses are significantly outperforming yoy
—
EBA stress test Core Tier I ratio of 6.5% (adverse scenario 2012) would improve to 7.5% when applying
RWA reduction and Core Tier I capital improvements in 1H2011 to EBA calculations
—
S
Sovereign
i exposure to
t PIIGS declined
d li d 70% tto EUR 3.7
3 7 bn
b as off 30 Jun
J 2011 vs. 31 D
Dec 2010
—
Completed 80% of our 2011 funding plan, including EUR 6.8 bn of deposit gathering YTD
—
PBC business ahead of plan despite EUR 132 m negative impact relating to Greek bonds. CB&S
performance
f
predicated
di t d on iimproving
i macro environment
i
t and
d recovery off client
li t activity
ti it llevels
l
—
Key risks remain: Sovereign debt concerns, regulatory asymmetry, FX volatility. Deutsche remains
attentive to managing through near term challenges with a focus on long term growth
EUR 10 bn IBIT target for business divisions still achievable given our diversified earnings stream
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
2
Agenda
1
Group results
2
Segment results
3
Key current topics
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
3
Highlights
Profitability
2Q2011
2Q2010
Income before income taxes (in EUR bn)
18
1.8
15
1.5
Net income (in EUR bn)
1.2
1.2
Pre-tax RoE (target definition)(1)
14%
13%
Diluted EPS (in EUR)
1.24
1.60
30 Jun 2011
Capital
Core Tier 1 capital ratio
10.2%
9.6%
Tier 1 capital ratio
14.0%
13.4%
44.7
43.8
Tier 1 capital (in EUR bn)
Balance
sheet
(1)
(2)
31 Mar 2011
Total assets (IFRS, in EUR bn)
Total assets (adjusted, in EUR bn)
1,850
1,842
1,209
1,202
Leverage ratio (target definition)(2)
23
23
Based on average active equity
Total assets (adjusted) divided by total equity per target definition
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
4
Profitability
Income before income taxes
Net income
In EUR bn
In EUR bn
3.0
2.8
1.5
13
1.3
1.8
(1)
2.1
1.8
12
1.2
0.7
(1.0)
1Q
2Q
3Q
4Q
1Q
2Q
( )/ (1)
(10)/13
6
2Q
3Q
4Q
2010
1Q
2Q
2011
Effective tax rate, in %
24
14
36
23
( )/ (1)
(16)/13
14
29
31
FY10: 41/ 26(1)
FY10: 10 /15(1)
(1)
(2)
1Q
2011
Pre-tax return on equity(2), in %
15
12
1.2
0.6
(1.2)
2010
30
1.1
1
1(1)
Excluding Postbank effect of EUR (2
(2.3)
3) bn in 3Q2010
Annualised, based on average active equity
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
5
Noninterest expenses
I EUR b
In
bn
Acquisitions:(2)
Compensation and benefits
General and
administrative expenses
Other noninterest expenses(1)
1Q2011
2Q2011
Compensation & benefits
509
453
General and admin.
expenses
555
In EUR m
1,064
993
540
11.3
5.7
6.3
7.1
30
3.0
30
3.0
3.1
4.3
34
3.4
2.2
0.2
2.3
0.0
2.5
0.2
3.1
0.2
1Q
2Q
3Q
2.7
0.1
1Q
2.9
0.1
2Q
5.9
36
3.6
5.4
0.0
4Q
6.3
6.6
2011
2010
4.5
13.4
7.6
5.6
0.2
0.1
0.1
1H
1H
2010
2011
41
40
Compensation
p
ratio(3), in %
40
Note:
(1)
(2)
(3)
(4)
42
60/41(4)
41
41
39
Figures may not add up due to rounding differences
Incl. policyholder benefits and claims, impairment of goodwill and intangible assets where applicable
Impact on businesses Sal. Oppenheim / BHF, ABN AMRO Netherlands, Postbank
Compensation & benefits divided by net revenues
Excluding Postbank effect of EUR (2.3) bn in 3Q2010
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
6
Capital ratios and risk-weighted assets
14.0
13.4
11.2
11.5
11.3
7.5
7.5
7.6
292
303
277
Tier 1 ratio, in %
12.3
8.7
346
9.6
10.2
328
320
Core Tier 1 ratio, in %
RWA, in EUR bn
1Q
2Q
3Q
4Q
2010
Note:
2Q
1Q
2011
Tier 1 ratio = Tier 1 capital / RWA; Core Tier 1 ratio = (Tier 1 capital - hybrid Tier 1 capital) / RWA
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
7
Core Tier 1 capital and RWA development
Core Tier 1 capital
RWA
In EUR bn
In EUR bn
1.2
0.0
(0.2)
31.6
32.5
327.9
(0.1)
(1.9)
319.7
((2.7))
(3.1)
31 Mar
2011
Note:
(1)
Net income
Dividend
accrual
QTD
FX Effect
Others (1) 30 Jun 2011
31 Mar
2011
FX effect
(0.6)
Credit risk Market risk Operational 30 Jun 2011
risk
Figures may not add up due to rounding differences
Including a decrease of the securitization deductions in the trading book (CDI excluding FX-effects) and common shares in treasury.
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
8
Funding activities update
Funding cost development
Observations
I bps
In
b
— Ongoing market volatility resulted in lower
total financial issuance (unsecured plus
covered) in 2Q2011 (-50% qoq in EUR)
320
280
European Sovereign
E
S
i CDS
iTraxx Senior Financials
DB 5yr Senior CDS
DB issuance spread (4wk mov avg.)
DB issuance activity
y
— Despite volatility
volatility, DB’s
DB s spreads remained
stable and market access unimpeded
240
— EUR 3 bn issued during 2Q2011 in line with
funding
gp
plan requirements,
q
taking
g YTD total
to EUR 14 bn at an average spread of L+54
(~40 bps tighter than average CDS)
200
160
120
— Further deposit gathering brings total
deposit campaign to EUR 7 bn YTD
80
— 80% Funding Plan completed YTD
(EUR 21 bn of EUR 26 bn Plan)
40
0
1Q2010
EUR 8 bn
2Q2010
EUR 7 bn
3Q2010
EUR 4 bn
2Q2011
1Q2011
4Q2010
EUR 4 bn EUR 10 bn EUR 3 bn
31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun
2010
Source:
2011
Bloomberg, Deutsche Bank
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
9
Agenda
1
Group results
2
Segment results
3
Key current topics
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
10
Segment overview
I
Income
before
b f
income
i
taxes,
t
in
i EUR m
2Q2011
2Q2010
982
CB&S
781
293
GTB
476 (1)
227
AWM
65
458(2)
PBC
CI
C&A
(1)
(2)
233
(139)
(85)
(43)
53
Positively impacted by EUR 208 m representing provisional goodwill commercial banking activities acquired from ABN AMRO in the Netherlands
Includes a Postbank consolidation effect of EUR 229 m in total
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
11
Corporate Banking & Securities
Income before income taxes
Key features
In EUR m
In EUR m
2,591
Revenues
3,633
((95))
((12))
((46))
(2,886)
(3,503)
(2,800)
3% (18)%
982
2,305
781
26% (57)%
CIR, in %
73
60
77
RoE in %
RoE,
21
49
16
Provisions
IBIT
781
1Q
2Q
982
4Q
2010
(1)
2Q
2Q2011 results
Stefan Krause, CFO
108%
n.m.
Lower volumes across flow businesses reflecting uncertain
macro environment and lower market activity especially in
Europe
—
P ti ll offset
Partially
ff t by
b strong
t
performances
f
in
i Corporate
C
t
Finance, Commodities, Emerging Markets and RMBS
—
Integra remains on track to deliver EUR 500 m IBIT
—
Lower qoq costs reflects lower performance related
accruals; higher yoy costs mainly driven by increased
policyholder benefits and claims (offset in revenue) and
higher amortisation of prior year deferrals
—
Maintained low levels of VaR during the quarter and
continued reduction in total capital demand due to mitigation
activities (e.g. hedges, optimization)
2011
Provision for credit losses
Deutsche Bank
Investor Relations
1Q
9% (32)%
—
627
3Q
2Q10
5,831
Noninterest exp.
1,102
1Q11
2Q11
vs.
1Q11
3,968
(1)
2 305
2,305
2Q11
2Q11 vs.
2Q10
financial transparency.
12
Sales & Trading debt and other products
Net revenues
Key features
In EUR m
Overall
— Ranked No.1 in US Fixed Income for the second
consecutive year (Greenwich)
— Lower revenues, especially in flow products, due to
seasonality and lower client activity due to market
conditions
diti
— Partially offset by strong performances in Commodities,
Emerging Markets and RMBS
3,802
3,650
2,310
,
2 134 2,235
2,134
1,569
FX / Money Markets / Rates
— FX ranked No
No.1
1 in Euromoney FX poll for 7th year running
— Lower revenues yoy driven by subdued overall market
volumes in flow products due to lower client activity
— RMBS significantly higher yoy due to business realignment
and absence of prior year losses
Credit
— Excluding the impact of prior year losses, revenues were
higher yoy across both flow and structured client solutions
1Q
2Q
3Q
4Q
2010
Deutsche Bank
Investor Relations
1Q
2Q
2011
2Q2011 results
Stefan Krause, CFO
Emerging Markets
— Higher yoy revenues especially in flow business, offsetting
lower client demand for structured products
Commodities
— Best ever second quarter driven by good performance in
precious metals
metals, oil and gas
financial transparency.
13
Sales & Trading equity
Net revenues
Key features
In EUR m
Overall
— Lower revenues yoy due to lower secondary market
volumes and commissions
Cash Equities
944
872
642
943
— Revenues down yoy due to significantly lower market
volumes and commissions in Europe, partially offset by
resilient performance in US and Asia commissions
650
555
— Named ‘World’s Best Broker’ by Bloomberg Markets for
first time ever
Prime Brokerage
— Named No.1 Global Prime Broker for fourth consecutive
year by Global Custodian
— Revenues lower yoy affected by low levels of leverage,
lower financing spreads
Equity Derivatives
1Q
2Q
3Q
4Q
2010
Deutsche Bank
Investor Relations
1Q
2Q
— Higher yoy revenues reflecting strong performance in the
US and g
good risk management
g
2011
2Q2011 results
Stefan Krause, CFO
financial transparency.
14
Origination & Advisory
Net revenues
Key features
In EUR m
Overall
— Maintained top five ranking, continuing to benefit from
synergies across the investment bank
— No.1 in EMEA, with highest ever market share – No.1 in
five countries
— No.1 in Global IPOs by value, for first time ever
(Bloomberg)
Advisory
— Revenues up yoy
— No.1
N 1 iin EMEA
— No.2 in cross-border deals (Thomson Reuters)
Equity Origination
— Revenues up significantly yoy driven by sharp increase in
IPO activity
— Maintained No.5 ranking globally
— No.1 in Asia Pac IPOs
Investment Grade
— No.1
No 1 in all international bonds ytd (Thomson Reuters)
— No.2 in all bonds in Euros (Thomson Reuters)
High Yield / Leveraged Loans
— Ranked No. 1 globally in High Yield
Advisory
Origination
809
563
543
563
131
124
137
432
418
426
1Q
2Q
3Q
717
714
159
152
628
558
562
4Q
1Q
2Q
181
2010
Note:
2011
Rankings refer to Dealogic (fee pool) and refer to 2Q2011 unless otherwise stated; figures may not add up due to rounding differences;
EMEA = Europe Middle East and Africa
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
15
Global Transaction Banking
Income before income taxes
Key features
In EUR m
In EUR m
2Q11
Negative goodwill(1)
4Q2010 efficiency measures(2)
476
212
118
130
268
92
1Q(4)
2Q
3Q
4Q
2010
(1)
(2)
(3)
(4)
1Q
2Q11
vs.
2Q10
2Q11
vs.
1Q11
895
865
1,070
(16)%
3%
Provisions(3)
(32)
(21)
(32)
1%
52%
(570)
(588)
(562)
1%
(3)%
293
256
476
(38)%
15%
CIR,, in %
64
68
53
RoE, in %
51
44
79
IBIT
256
2Q10
Revenues
Noninterest exp.
293
1Q11
—
Strong performance across all major products
—
Fee income remains robust
—
Benefit from initial interest rate increases, particularly in
Asia and Europe
—
Continued focus on cost management
2Q
2011
Negative goodwill (provisional at that time) from the commercial banking activities acquired from ABN AMRO in the Netherlands and consolidated since 2Q2010
Related to complexity reduction program and CIB integration; severance booked directly in GTB and allocations of severance from infrastructure
Provision for credit losses
Includes impairment of EUR 29 m related to intangible assets
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
16
Asset and Wealth Management
Income before income taxes
Key features
In EUR m
In EUR m
2Q11
227
190
65
(5)
1Q
2Q
(1)
(2)
2Q11
vs.
1Q11
1,002
896
9%
(3)%
Provisions(1)
Noninterest exp.
(13)
(19)
(3)
n.m.
(29)%
(737)
(792)
(828)
(11)%
(7)%
227
190
65
n.m.
19%
(2)
797
799
825
((3)%
)
((0)%
)
(2)
(0)
(2)
(14)
n.m.
n.m.
Net new money
59
3Q
4Q
1Q
2Q
2011
BHF was transferred to Corporate Investments as of 1 Jan 2011; prior periods
have been adjusted
Provision for credit losses
In EUR bn
Deutsche Bank
Investor Relations
2Q11
vs.
2Q10
976
ested assets
Invested
2010
Note:
2Q10
Revenues
IBIT
91
1Q11
2Q2011 results
Stefan Krause, CFO
—
Revenues benefited from improved transaction
volumes, market conditions and investment
volumes
performance as well as flows into higher margin
products
—
Reduced Sal. Oppenheim integration and operating
costs and broad benefits from platform efficiencies led
to decreased expense levels
—
Asset flows stabilized in the quarter, a strong
improvement versus the trend a year ago
financial transparency.
17
Asset Management
Income before income taxes
Key features
In EUR m
In EUR m
124
Revenues
417
9%
3%
(0)
(0)
(0)
23%
14%
(328)
(366)
(361)
(9)%
(10)%
IBIT
124
75
56
121%
67%
Invested assets(2)
523
529
551
(5)%
(1)%
Net new money(2)
(5)
(5)
(12)
n.m.
n.m.
Noninterest exp.
75
56
—
32
—
1Q
2Q
3Q
4Q
2010
(1)
(2)
2Q
2011
Provision for credit losses
In EUR bn
Deutsche Bank
Investor Relations
1Q
2Q2011 results
Stefan Krause, CFO
2Q10
441
Provisions
84
1Q11
2Q11
Q
vs.
1Q11
453
(1)
96
2Q11
2Q11
vs.
2Q10
—
Positive operating leverage reflects successful
business realignment to current macro economic
environment
Strong performance fees of EUR 50 m, almost double
vs. 2Q2010, driven by DWS (EUR 31 m) and RREEF
Infrastructure (EUR 19 m)
Net Flows in 2Q2011 are negative EUR (5) bn mostly
d tto EUR (3) b
due
bn C
Cash
h outflows
tfl
and
d EUR (2) b
bn
Insurance outflows, consistent with the industry; strong
inflows continued in high-fee White Label and
Retirement products adding about EUR 1 bn; revenue
impact from the flows remains positive due to favorable
asset mix shift
financial transparency.
18
Private Wealth Management
Income before income taxes
Key features
In EUR m
In EUR m
116
9
102
7
3Q
4Q
2010
Note:
(1)
(2)
1Q
2Q
479
9%
(7)%
Provisions(1)
(13)
(19)
(3)
n.m.
(29)%
(408)
(426)
(467)
(13)%
(4)%
IBIT
102
116
9
n.m.
(12)%
Invested assets(2)
274
271
274
(0)%
1%
Net new money(2)
5
3
(2)
n.m.
n.m.
Noninterest exp.
Deutsche Bank
Investor Relations
—
2011
BHF was transferred to Corporate Investments as of 1 Jan 2011; prior periods
have been adjusted
Provision for credit losses
In EUR bn
2Q2011 results
Stefan Krause, CFO
2Q11
vs.
1Q11
561
(37)
2Q
Q
2Q11
vs.
2Q10
523
—
1Q
2Q10
Revenues
—
(37)
1Q11
2Q11
—
Yoy 9% revenue increase driven by positive NNM flows,
market performance and profitable asset mix shift.
2Q2011 saw lower revenue from large transactions and
structured products compared to 1Q2011
Sal. Oppenheim with positive contribution during
2Q2011 and overall for 1H2011, supported by good cost
discipline
P iti NNM off EUR 5 bn
Positive
b for
f 2Q2011,
2Q2011 mainly
i l relating
l ti
to Asia/Pacific , Sal. Oppenheim, Germany and
Americas in core client segments of HNW/UHNW
Invested assets negatively affected by FX offsetting
positive NNM in 2Q2011 relative to 1Q2011 and
2Q2010
financial transparency.
19
Private & Business Clients
Income before income taxes
Key features
In EUR m
In EUR m
Net HuaXia one-off gain
Negative impact from Greek government
bonds(1)
Cost to achieve related to Postbank
Cost-to-achieve
acquisition
78
Revenues
Provisions
236
40
132
788
42
189
233
245
552
458
222
Noninterest exp.
IBIT
2Q
3Q
4Q
2010
(1)
(2)
1Q
2Q
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
2Q10
3,072
1,444
77%
(17)%
(320)
(320)
(171)
87%
(0)%
(1,736) (1,888) (1,040)
67%
(8)%
96%
(42)%
233
CIR, in %
68
61
72
RoE, in %
16
28
23
—
—
—
—
—
—
—
2Q11
vs.
1Q11
2,563
788
2011
Includes EUR 155 m impairment losses, partly offset by EUR 22 m noncontrolling
interests on segment level
Provision for credit losses; impacted by specific accounting effect as referred to on
page 24
1Q11
458
—
1Q
(2)
2Q11
2Q11
vs.
2Q10
PBC with strong result ahead of plan to date
Deposits & payments revenues at record level
Investment products revenues reflecting uncertainty in
the market
Reduced risk appetite and margin pressure leading to
lower revenues from credit products
Further decreasing risk costs
Efficiency and cost management programmes progress
according to plan
Continued strong net Postbank contribution
Postbank cooperation and integration continues to be
well on track
financial transparency.
20
PBC – business division performance
I
Income
b f
before
income
i
ttaxes, iin EUR m
2Q2011 – Reported results
2Q2010 – Reported results
Negative impact from Greek government bonds
Cost-to-achieve related to Postbank acquisition
Advisory Banking Germany
Advisory Banking International
Consumer Banking Germany
PBC Total
Note:
(1)
124
42 35 201(1)
168
105
66
229
90
5 324 (1)
458
132
40 630(1)
233
Synergies are also reflected on business division level
Adj t d IBIT,
Adjusted
IBIT excluding
l di CtA and
d negative
ti iimpactt ffrom Greek
G k governmentt bonds.
b d In
I Consumer
C
Banking
B ki G
Germany negative
ti iimpactt ffrom Greek
G k governmentt bonds
b d is
i
partly offset by noncontrolling interests on segment level
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
21
Corporate Investments
Income before income taxes
2Q2011 key features
In EUR m
— Net revenues of EUR 194 m compared to
EUR 115 m in 2Q2010
— EUR 39 m impairment charge related to
investment in Actavis
65
(85)
(165) (139)
(390)
— Noninterest expenses of EUR 329 m
compared to EUR 208 m in 2Q2010;
i
increase
mainly
i l d
driven
i
b
by consolidated
lid t d
investment in Cosmopolitan which started
its operation at the end of 2010
(2 350)
(2,350)
1Q
2Q
3Q
4Q
2010
Note:
1Q
2Q
2011
BHF was transferred to Corporate Investments as of 1 Jan 2011; prior figures have been adjusted
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
22
Agenda
1
Group results
2
Segment results
3
Key current topics
Deutsche Bank
Investor Relations
2Q2011 results
Stefan Krause, CFO
financial transparency.
23
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
362
262
243
50
129
159
193
233
1Q
2Q
3Q
103
406
47
(1)
79
PCAM
Note:
(1)
(2)
(3)
837
117
22
359
382(3)
(1)
256(3)
303
234
506
154
352
4Q
1Q
2010
CIB
82
373
2Q
2011
1Q2010
2Q2010
3Q2010
90
173
77
174
179
185
4Q2010
143
(2)
254
1Q2011
33
(2)
338
2Q2011
127
(2)
333
200
100
537
1H
1H
2010
2011
1H2010
1H2011
167
(2)
346
638(3)
160
(2)
671
Divisional figures do not add up due to omission of Corporate Investments; figures may not add up due to rounding differences
Includes IAS 39 reclassified assets of EUR (6) m
Includes consolidation of Postbank since December 2010
Provisions for credit losses before Postbank releases in relation to allowances established before consolidation
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financial transparency.
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Impaired loans
I EUR bn
In
b
… Relating to IAS 39 loans
7.4
7.6
7.4
7.4
6.7
6.3
2.9
2.8
2.7
47%
48%
49%
31 Mar
30 Jun
30 Sep
1.2
1.1
53%
50%
31 Dec
0.8
46%
31 Mar
2010
30 Jun
2011
IFRS impaired loans((1))
IFRS impaired loans coverage ratio(2)
(1)
(2)
IFRS impaired loans include loans which are individually impaired under IFRS, i.e. for which a specific loan loss allowance has been established, as well as loans
collectively assessed for impairment which have been put on nonaccrual status
Total on-balance
on balance sheet allowances divided by IFRS impaired loans (excluding collateral); total on
on-balance
balance sheet allowances include allowances for all loans
individually impaired or collectively assessed
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EBA stress test: Update for 1H2011 capital formation
Core Tier 1 capital ratio (%)
EBA adverse scenario
2010
2012
8 8%
8.8%
1H2011
capital
it l
formation
6 5%
6.5%
500
EBA stress
t
pro-forma
(1)
— DB with 6.5% Core Tier 1 ratio in
2012 adverse scenario
7 5%
7.5%
473
2.5
347
— DB reported Basel Core Tier 1
ratio at 30 June 2011 was
10 2% ii.e. 150 b
10.2%,
bps above
b
D
Dec
2010 Basel Core Tier 1 ratio
— Applying RWA reduction and
Core Tier 1 capital
improvements from 1H2011 to
EBA stress results leads to a
pro-forma EBA adverse scenario
Core Tier 1 ratio of 7
7.5%
5%
35
30
Key features
33
(27)
Core RWA
Tier 1
Capital
Core RWA
Tier 1
Capital
Core RWA
Tier 1
Capital
Core
Tier 1
Capital
RWA
(1) EBA stress test results adjusted for 1H11 movement in RWA and Core Tier 1 capital.
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Net sovereign exposure on select countries
I EUR m
In
Overview of net sovereign exposure
31 Dec 2010
30 Jun 2011
Key features
12,120
— Sovereign exposure to PIIGS declined
70% to EUR 3.7 bn as of 30 Jun 2011
vs. 31 Dec 2010
8,011
3,669
2 283
2,283
1,601
1,154
1,070
997
237 296
153
(12)
Greece
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Italy
Portugal
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Spain
Total
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Update on 2011 targets
I
Income
before
b f
income
i
taxes,
t
in
i EUR bn
b
1H2011
Corporate Banking &
Securities
Phase 4
potential 2011
Key features / Prospects
—
3.3
6.4
—
Global Transaction
Banking
0.5
1.0
Asset and Wealth
Management
0.4
1.0
Private & Business
Clients
1.2
1.6
Total business
divisions
5.5
10.0
Note:
Material deterioration of market assumptions versus plan.
Concerns intensified over sovereign debt risk leading to
increased client uncertainty
Achievement of IBIT goal is highly predicated on return of
client confidence
—
Benefiting from initial positive impact from higher short-term
interest rates
—
Expect to continue to capitalize on relatively strong German
business conditions
PBC well ahead of plan; efficiency cost programme on track
—
Figures may not add up due to rounding differences
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Summary and Outlook
—
Considerable near term uncertainties in the Eurozone, in the world economy, in financial markets, and in
the new regulatory environment
—
EUR 10 bn earnings target is still achievable but predicated on a recovery in European capital markets
and progress with regards to a solution of the European debt crisis
—
Strong performance
St
f
off our classical
l
i l banking
b ki businesses
b i
continue
ti
tto provide
id meaningful
i f l earnings
i
diversification and is evidence of our strategic progress
—
Lower funding requirements and diversification of funding sources support our stable funding outlook
—
Continued focus on capital generation
In challenging times, Deutsche Bank is staying the course: building a focused, well-capitalised, riskefficient, and well-balanced platform for profitable growth.
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Deutsche Bank
Additional information
Loan book
I EUR bn
In
b
… IAS 39 impact on CIB loan book
34
35
32
27
25
23
411
398
398
8
11
147
135
11
135
270
292
283
13
12
11
136
154
147
126
126
128
PCAM ex
Postbank
121
126
125
129
125
123
Postbank
31 Mar
30 Jun
30 Sep
31 Dec
31 Mar
30 Jun
2010
Germany excl
excl. Financial Institutions and Public Sector:
90
Note:
(1)
CI
95
94
175(1)
CIB
2011
175(1)
176(1)
Loan amounts are gross of allowances for loan losses; figures may not add up due to rounding differences
Thereof, Postbank accounts for EUR 84 bn (31 Dec 2010), EUR 84 bn (31 Mar 2011) and EUR 84 bn (30 June 2011)
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Composition of loan book and provisions by category
I EUR bn,
In
b as off 30 JJune 2011
282
182
398
... DB 2Q2011 provision for credit losses ex. PB(1), in EUR m
... Postbank (PB) 2Q2011 provision for credit losses(1), in EUR m
IAS 39 reclassified assets
464
134
Postbank
79
69
 Low loan
to value
23
(69)
(143)
375
 Partially
hedged
(31)
(58)
 Highly
diversified
 Short term
 Substantially
 Mostly
 Credit
collateralised
collateralised
umbrella
by Gov’t
 Liquid
securities
collateral  Substantial  Partially  Additional
 Partially
 Strong
Gov’t
collateral
hedged
hedging  High
 Substantial
underlying
g’teed
 Mostly
mitigants
margin
collateral /
(2)
asset
(39)
senior
business
hedging  Diversified
quality
(25)
secured
asset
(4)
(18)
(11)
pools
(6)
(8)
(4)
(19)
Total
loan
book,
gross
PBC
mortgages
Inv grade /
German midcap
GTB
PWM
(16)
(1)
((14))
PBC
Corporate Structured
CollateraAsset
PBC
small
Invest- transactions
lised /
Finance
consumer
corporates/ ments collateralised by
finance (DB sponsored hedged
others
Govts, cash and
conduits) structured
transactions
own debt
Lower risk bucket
(6)
Financing
of pipeline
assets
Moderate risk bucket
(2)
CF
Leveraged
Finance
 Predominantly
mortgage secured
 Diversified by asset
type and location
(7)
(15)
(28)
(4)
(1)
(11)
Commercial Other
Real
Estate(2)
Higher risk bucket
76%
90%
Note:
(1)
(2)
Loan amounts are gross of allowances for loan losses; figures may not add up due to rounding differences
Includes provision for off-balance sheet positions; releases shown as negative number
Includes loans from CMBS securitizations
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IAS 39 reclassification
Carrying Value vs. Fair Value
2Q2011 developments
In EUR bn
— The Gap between carrying value and fair value
has closed by EUR 0.5 bn in 2Q2011,
EUR 1.0 bn since 31 Dec 2010
Sales & Trading - Debt
Origination and Advisory
31 Dec
2008
(4.0)
31 Dec
2009
(3 3)
(3.3)
Loan Products
31 Dec
2010
(2.8)
(2.3)
(0.5)
30 Jun
2011
(1.8)
(0 1)
(0.1)
(0.1)
(0.2)
(1.0)
(0.1)
31 Mar
2011
(1.9)
(2.5)
— During
g 2Q2011 carrying
y g value and fair value
reduced by EUR 1.9 bn and EUR 1.4 bn
respectively, largely driven by restructured and
redeemed assets
— Assets sold during 2Q2011 had a book value of
EUR 0.2 bn; net gain on disposal was EUR 5 m
— Redemptions and maturities have typically been
y g value
at or above carrying
(3.0)
(3.7)
(5.1)
Carrying Value 34.4
33.6
26.7
24.5
22.6
Fair Value
29.8
23.7
22.1
20.6
Note:
29.3
At the reclassification dates, assets had a carrying value of EUR 37.9 bn; incremental RWAs were EUR 4.4 bn; there have been no reclasses since 1Q2009; above figures may not add
up due to rounding differences.
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Funding sources and liquidity
I EUR b
In
bn
Funding sources overview
Liquidity position
31 Mar 2011 (Total: EUR 1,078 bn)
30 Jun 2011 (Total: EUR 1,088 bn)
— Contribution of stable funding sources
remained unchanged
— Higher volume of discretionary
wholesale used to further increase the
bank’s Liquidity Reserves
276278
— Liquidity Reserves(4) as of 30 June
2011 exceed
d EUR 150 bn
b up some
EUR 15 bn vs. 1Q2011
216212
209206
132133
119 123
100 113
26 23
Capital
markets
k t
and
equity(1)
Retail(1)
Transaction
Other
(2)
b ki (1) C
banking
Customers
t
Discreti
tionary
wholesale
Secured
f di
funding
and shorts
Financing
vehicles
hi l (3)
Unsecured funding and equity
Note:
(1)
(2)
(3)
(4)
Reconciliation to total balance sheet: Derivatives & settlement balances EUR 644 bn (EUR 653 bn), add-back for netting effect for Margin & Prime Brokerage cash balances (shown on a
net basis) EUR 53 bn (EUR 51 bn), other non-funding liabilities EUR 64 bn (EUR 60 bn) for 30 June 2011 and 31 March 2011, respectively; figures may not add up due to rounding
Following a revised allocation of Postbank liabilities to funding buckets implemented during 2Q2011, for 31 March 2011 EUR 5 bn and EUR 7 bn were reallocated from Capital Markets
and Equity and Retail, respectively, to Transaction Banking
Other includes fiduciary, self-funding structures (e.g. X-markets), margin / Prime Brokerage cash balances (shown on a net basis)
Includes ABCP conduits
The bank
bank's
s Liquidity Reserves include (a) unencumbered central bank eligible business inventory
inventory, (b) available excess cash held primarily at central banks,
banks as well as (c) the strategic
liquidity reserve of highly liquid government securities and other central bank eligible assets. Excludes any positions held by Postbank
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Group headcount
F ll ti
Full-time
equivalents,
i l t att period
i d end
d
31 Dec
2010
31 Mar
2011
30 Jun
2011
CIB
15,741
15,438
PCAM
50,836
Corporate Investments
30 Jun 2011 vs.
31 Mar 2011
Total
change
Net of
de-/consolidation
15,359
(79)
(79)
50,427
50,203
(223)
(19)
1,556
1,469
1,443
(26)
(26)
Infrastructure
33 929
33,929
34 543
34,543
34 689
34,689
146
153
Total
102,062
101,877
101,694
(182)
29
Note:
Figures may not add up due to rounding differences
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Number of shares for EPS calculation
I million
In
illi
Average
FY
2010
Common shares issued(1)
Total shares in treasury
Common shares outstanding
Vested share awards(2)
Basic shares
(denominator for basic EPS)
Dilution effect
Diluted shares
(denominator for diluted EPS)
Note:
(1)
(2)
1Q
2011
At end of period
2Q
2011
31 Dec
2010
31 Mar
2011
30 Jun
2011
741
929
929
929
929
929
(4)
(7)
(9)
(10)
(4)
(19)
737
922
921
919
925
911
17
15
16
13
15
17
753
937
937
932
940
928
37
31
31
791
969
968
Figures may not add up due to rounding differences
The number of common shares issued has been adjusted for all periods before the 2010 capital increase in order to reflect the effect of the bonus element of
subscription rights issued in September 2010
Still restricted
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Invested assets(1) report
I EUR bn
In
b
31 Dec 2010
Asset and Wealth Management
Asset Management
Institutional
Retail
Alternatives
Insurance
Private Wealth Management
Private
P
i
&B
Business
i
Cli
Clients
Securities
Deposits excl. sight deposits
Insurance(2)
PCAM
Note:
(1)
(2)
825
550
175
178
46
151
275
306
129
164
12
1,131
31 Mar 2011
799
529
164
175
46
143
271
313
129
171
13
1,112
Net new money
30 Jun 2011
797
523
163
173
45
142
274
313
129
171
13
1,109
1Q2011
2Q2011
(2)
(5)
(4)
1
0
(3)
3
7
1
6
0
5
(0)
(5)
(3)
0
(0)
(2)
5
0
0
0
0
(0)
Excludes BHF which was transferred to Corporate Investments as of 1 Jan 2011; prior periods have been adjusted; figures may not add up due to rounding differences
Assets held by Deutsche Bank on behalf of customers for investment purposes and / or managed by Deutsche Bank on a discretionary or advisory basis or deposited
with Deutsche Bank
Life insurance surrender value
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Regional invested assets(1) – AM and PWM
I EUR bn
In
b
31 Dec 2010
31 Mar 2011
30 Jun 2011
30 Jun 11 vs
vs.
31 Mar 11
550
244
25
34
223
25
275
129
53
64
30
825
529
242
23
30
209
25
271
129
51
62
29
799
523
246
22
30
202
23
274
130
52
61
31
797
(1)%
1%
(2)%
0%
(3)%
(6)%
1%
1%
1%
(1)%
7%
(0)%
Asset Management
Germany
UK
Rest of Europe
Americas
Asia Pacific
Private Wealth Management
Germany
EMEA
USA/Latin America
Asia Pacific
Asset and Wealth Management
Note:
(1)
Excludes BHF which was transferred to Corporate Investments as of 1 Jan 2011; prior periods have been adjusted; figures may not add up due to rounding
differences
Assets held by Deutsche Bank on behalf of customers for investment purposes and / or managed by Deutsche Bank on a discretionary or advisory basis or deposited
with Deutsche Bank
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Regional net new money – AM and PWM
I EUR bn
In
b
1Q2010
2Q2010
3Q2010
4Q2010
FY2010
1Q2011
2Q2011
Asset Management
Germany
UK
Rest of Europe
Americas
Asia Pacific
4
4
((0))
1
0
(1)
(12)
0
1
(1)
(11)
(0)
2
(1)
1
(0)
3
(1)
4
3
3
(1)
(1)
2
(1)
6
4
(1)
(9)
(0)
(5)
2
((4))
(2)
(2)
1
(5)
1
((0))
(1)
(5)
(0)
Private Wealth Management
Germany
EMEA
USA / Latin America
Asia Pacific
5
2
(0)
1
2
(2)
1
0
((1))
(2)
(2)
1
(2)
((1))
(0)
(0)
1
(3)
1
1
1
5
(4)
((1))
1
3
1
1
0
1
5
2
0
((0))
3
Asset and Wealth Management
9
(14)
0
4
(1)
(2)
(0)
Note:
Excludes BHF which was transferred to Corporate Investments as of 1 Jan 2011; prior periods have been adjusted; figures may not add up due to rounding
differences
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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 2.8 bn
Sales & Trading revenues
EUR 2.9 bn
180
160
140
120
100
80
60
40
20
(1)
 102
 49
2Q2010
 87
 46
3Q2010
 78
 45
4Q2010
 80
 46
1Q2011
 75
 44
2Q2011
Constant VaR is an approximation of how the VaR would have developed in case the impact of any market data changes since 4th Oct 2007 on the current portfolio
of trading risks was ignored and if VaR would not have been affected by any methodology changes since then
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Total assets (adjusted)
I EUR bn
In
b
Positive market values
from derivatives
Financial assets
at FV through
g P&L
Trading securities
Other trading assets
Reverse repos /
securities borrowed
Loans des. at FV
Other des. at FV
Net loans
Cash and deposits with banks
Securities borrowed / reverse repos
Brokerage & securities rel
rel. receivables
Other(1)
1,202
62
Derivatives p
postnetting
252
394
99
60 20
116
Derivatives post
postnetting
259
290 Trading assets
30
132
25
11
33
131
23
11
31 Mar 2011
Note:
(1)
286 Trading assets
1,209
60
Reverse repos /
191 securities
borrowed
395
Reverse repos /
183 securities
borrowed
113
51 22
111
30 Jun 2011
Figures may not add up due to rounding differences
Incl. financial assets AfS, equity method investments, property and equipment, goodwill and other intangible assets, income tax assets and other
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Balance sheet leverage ratio (target definition)
I EUR bn
In
b
2010
31 Mar
Total assets (IFRS)
30 Jun
2011
30 Sep
31 Dec
31 Mar
30 Jun
1,670
(559)
1,926
(735)
1,958
(760)
1,906
(602)
1,842
(508)
1,850
(503)
(126)
(139)
(144)
(86)
(122)
(125)
Total assets (adjusted)
(7)
978
(9)
1,043
(10)
1,044
(8)
1,211
(10)
1,202
(13)
1,209
T t l equity
Total
it (IFRS)
40 2
40.2
42 6
42.6
39 5
39.5
50 4
50.4
51 6
51.6
51 7
51.7
1.7
3.4
2.0
2.0
1.7
1.6
41.9
46.0
41.5
52.4
53.2
53.3
42
23
45
23
50
25
38
23
36
23
36
23
Adjustment for additional derivatives netting
Adjustment for additional pending settlements
netting
Adjustment for additional reverse repo netting
Adjust pro-forma FV gains (losses) on the Group's
own debt (post-tax)(1)
Total equity adjusted
L
Leverage
ratio
i based
b
d on totall equity
i
According to IFRS
According to target definition
Note:
(1)
Figures may not add up due to rounding differences
Estimate assuming that substantially all own debt was designated at fair value
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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 based on plans, estimates and projections as they are currently available to the management of
Deutsche Bank. Forward-looking statements therefore speak only as of the date they are made, and we undertake no
obligation to update publicly any of them in light of new information or future events.
events
By their very nature, forward-looking statements involve risks and uncertainties. A number of important factors could
therefore cause actual results to differ materially from those contained in any forward-looking statement. Such factors
include the conditions in the financial markets in Germany,
y, in Europe,
p , in the United States and elsewhere from which we
derive a substantial portion of our revenues and in which we hold a substantial portion of our assets, the development of
asset prices and market volatility, potential defaults of borrowers or trading counterparties, the implementation of our
strategic initiatives, the reliability of our risk management policies, procedures and methods, and other risks referenced in
our filings with the U.S.
U S Securities and Exchange Commission.
Commission Such factors are described in detail in our SEC Form
20-F of 15 March 2011 under the heading “Risk Factors.” Copies of this document are readily available upon request or
can be downloaded from www.deutsche-bank.com/ir.
presentation also contains non-IFRS financial measures. For a reconciliation to directlyy comparable
p
figures
g
reported
p
This p
under IFRS, to the extent such reconciliation is not provided in this presentation, refer to the 2Q2011 Financial Data
Supplement, which is accompanying this presentation and available at www.deutsche-bank.com/ir.
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