Deutsche Bank AG · XETR:DBK
Deutsche Bank — Debt Investor Presentation (November 2018)
37 slides from Deutsche Bank's debt investor presentation, Nov 22, 2018
Slide 1: Asia fixed income investor update
Deutsche Bank Asia fixed income investor update Jonathan Blake, Head of Issuance & Securitization Philip Teuchner, Head of Debt IR 22-28 November 2018
Slide 2: Deutsche Bank at a glance
Deutsche Bank at a glance € bn Key figures(1) (30 Sep 2018) Revenues by business(2) Leverage exposure by business(3) 9M 2018 30 Sep 2018 IFRS assets 1,380 AM 0% Leverage 1,305 exposure AM Risk-weighted 8% 342 PCB assets 27% AWM Common Equity 47.8 6% Tier 1 capital Germany PCB CIB 34% 39% 53% Tier 1
Slide 3: A safer and more secure organization
A safer and more secure organization € bn, at period end, unless otherwise stated Shareholders’ equity Liquidity reserves(1) Most stable funding(2) Avg. Value-at-Risk(3) Level 3 assets(4) In € m (71)% (74)% 1.7x 4.1x 2.6x 77% 88 268 86 63 37 30% 65 25 23 2007 Q3 2018 2007 Q3 2018 2007 Q3 2018 2007 Q
Slide 4: Well positioned for long-term regulatory requirements
Well positioned for long-term regulatory requirements Regulatory ratios 30 Sep 2018 Buffer 30 Sep 2018 Group targets € 12bn above SREP CET1 ratio 14.0% CET 1 ratio 14.0% above 13% requirement(1) Liquidity € 76bn above 100% Leverage coverage 148% 4.0%(5) 4.5% requirement ratio ratio(2) 36% RWA / TLAC
Slide 5: Agenda
Agenda 1 Q3 2018 results & strategy update 2 Capital, funding and liquidity 3 Appendix Deutsche Bank Asia fixed income investor update 4 Investor Relations 22-28 November 2018
Slide 6: Executing on strategic plan to improve earnings and capital generation over time
Executing on strategic plan to improve earnings and capital generation over time On track towards near-term cost and headcount targets Common Equity Tier 1 (CET1) ratio further strengthened to 14% Conservative balance sheet management provides a solid basis to support business growth Prudent redeplo
Slide 7: Progress on cost, resources and profitability metrics
Progress on cost, resources and profitability metrics Adjusted costs (€ bn) Employees (in 000’s)(1) Post-tax return on tangible equity (2.8) 23.9 97.5 >4.0% 23 22 Q4 6.4 94.7 <93.0 Q3 5.5 5.5 <90.0 1.7% Q2 5.6 5.6 Q1 6.3 6.3 2017 9M 2018 Target Target 31 Dec 30 Sep Target Target (1.4)% 2018 2019 201
Slide 8: Q3 Group financial highlights
Q3 Group financial highlights € m, unless stated otherwise Higher / (lower) in % Q3 2018 vs. Q3 2017 vs. Q2 2018 Revenues 6,175 (9) (6) Revenues of which: Specific items(1) (16) n.m. n.m. Noninterest expenses 5,578 (1) (4) Costs of which: Adjusted costs 5,462 (1) (2) Cost/income ratio (in %) 90 7) p
Slide 9: Adjusted costs
Adjusted costs(1) € m, FX adjusted(2) (1)% 46 5,526 (6) 5,462 — Delivering in line with targets (50) (53) — Compensation and benefits: higher charges for deferred compensation — IT costs broadly flat as cost for ongoing investments including higher amortization are absorbed Q3 2017 Compensation IT c
Slide 10: Employees
Employees Full-time equivalents(1) 95,429 (104) Front office Allocated Infrastructure — Remain on track to meet <93,000 target by year-end 2018 (349) — Reduction of ~1,450 FTE excluding ~750 graduate hirings during the quarter (453) (149) — Reduction in the quarter driven by infrastructure staff, fo
Slide 11: CIB – Reallocating leverage to higher return areas
CIB – Reallocating leverage to higher return areas In € bn, as of 31 March 2018, unless otherwise stated Corporate & Investment Bank CRD4 leverage exposure 1,049 Pending settlements 52 Revenue/ Business Resource Liquidity Reserve 243 Leverage allocation (2017 in bps) intent Businesses — GTB: Cash Ma
Slide 12: PCB – Delivering in the Private & Commercial Bank
PCB – Delivering in the Private & Commercial Bank Targeted Key achievements Ongoing initiatives synergies Aspiration Private — Sales channel optimisation Clients and product consolidation — Increase cross-sell and — Legal entity merger and regulatory grow volumes in core 2022 synergy Commercial waiv
Slide 13: Continued conservative balance sheet management
Continued conservative balance sheet management As of 30 Higher / (lower) September 2018 vs. 30 June 2018 Common Equity Tier 1 capital CET1 capital ratio 14% 23 bps ratio (fully loaded) above >13% target Excess above MREL Loss-absorbing capacity € 118bn € (1)bn requirement: € 19bn(1) Provision for c
Slide 14: Agenda
Agenda 1 Q3 2018 results & strategy update 2 Capital, funding and liquidity 3 Appendix Deutsche Bank Asia fixed income investor update 13 Investor Relations 22-28 November 2018
Slide 15: Capital ratios
Capital ratios CRD4, fully loaded, € bn except movements (in basis points) CET1 ratio 25 14.0% — Reduced risk-weighted assets (RWA) driven by lower: 13.7% (1) (1) — Credit risk RWA in CIB, driven by de-risking in non-strategic assets and distribution of risk related to transactions originated in Cor
Slide 16: Minimum Requirement for Own Funds and Eligible Liabilities (MREL)
Minimum Requirement for Own Funds and Eligible Liabilities (MREL) € bn, unless stated otherwise Deutsche Bank available MREL categories 118 — Deutsche Bank has a loss absorbing capacity of € 118bn Plain-vanilla 1(2) which is € 19bn above MREL requirement(6) senior preferred debt(1) — German law chan
Slide 17: 2018 funding plan and contractual maturities
2018 funding plan and contractual maturities € bn 2018 funding plan Maturity profile Covered Bonds Senior Structured / Preferred Senior Non-Preferred Additional Tier 1 / Tier 2 Expected contractual maturities(1) 23 24 20-22 22 22 3 19 19 2 4 3 3 4 17 2 8 4 7 5 11 4 1 7 16 16 4 9-11 9 8 6 4 1 2018 YT
Slide 18: Strong balance sheet with stable funding
Strong balance sheet with stable funding Overview after netting, € bn, as of 30 September 2018 Assets Liabilities & equity 1,016 1,016 4 Unsecured wholesale (excl. deposits) Trading liabilities, repos Cash and equivalents 210 196 116 and securities lent(2) 27 Derivatives(3) Liquidity 36 Brokerage pa
Slide 19: Liquidity
Liquidity Liquidity Coverage Ratio(1) (LCR) 147% 147% 148% 140% — Liquidity Coverage Ratio stayed broadly flat over the quarter 128% € 76bn above — Liquidity Reserves decreased by € 11bn to 119% 100% require- € 268bn, primarily driven by lower wholesale ment funding and Targeted longer-term refinanc
Slide 20: Agenda
Agenda 1 Q3 2018 results & strategy update 2 Capital, funding and liquidity 3 Appendix Deutsche Bank Asia fixed income investor update 19 Investor Relations 22-28 November 2018
Slide 21: AT1 and Trust Preferred Securities outstanding
AT1 and Trust Preferred Securities outstanding(1) Original Regulatory Capital Current Nominal Next call Subsequent Issuer ISIN issuance treatment(1) recognition(1) Coupon outstanding date call period date DB Contingent Capital Trust II AT1 / Tier 2 100% / 100% US25153X2080 6.550% USD 800mn 23-May-07
Slide 22: Available Distributable Items (ADI)
Available Distributable Items (ADI) ADI as of December 2017 Reserves under DB AG’s balance sheet(1) (1) Based on local GAAP (HGB) Deutsche Bank Asia fixed income investor update 21 Investor Relations 22-28 November 2018
Slide 23: Minimum Requirement for Own Funds and Eligible Liabilities (MREL)
Minimum Requirement for Own Funds and Eligible Liabilities (MREL)(1) Single Resolution Board (SRB) methodology (% RWA) Requirements Pillar 1 minimum requirement — MREL requirement calculated by the Single Resolution Pillar 2 requirement Board (SRB) from a % of risk-weighted assets (RWA), Combined bu
Slide 24: Capital Markets and Equity to MREL reconciliation
Capital Markets and Equity(1) to MREL reconciliation € bn, as of 30 September 2018 Covered 199 bonds 22 (22) Structured notes 24 (24) Plain-vanilla 1 senior preferred (18) (0) 118 (17) 1 Plain-vanilla Plain-vanilla 73 1 senior senior preferred non-preferred Plain-vanilla 54 senior non- AT1 / Tier 2
Slide 25: Current Ratings
Current Ratings part of loss-absorbing capacity senior to loss-absorbing capacity Counterparty obligations (e.g. Deposits / Structured A3 BBB+(1) A- A (high) Notes / Derivatives / Swaps) Senior Preferred(2) A3 BBB+ A- A (low) Long- term unse- cured Non-preferred Baa3 BBB- BBB+ BBB (high) Tier 2 Ba2
Slide 26: Rating landscape – senior unsecured and short-term ratings
Rating landscape – senior unsecured and short-term ratings Moody‘s S&P Operating company / Preferred Senior(1) Holding company / Non-preferred Senior(2) Rating scale EU Peers Swiss Peers US Peers Short-term Long-term BAR BNP HSBC SOC CS UBS BoA Citi GS JPM MS P/A-1 Aa2/AA P/A-1 Aa3/AA- P/A-1 A1/A+ P
Slide 27: Specific items – Q3 2018
Specific items – Q3 2018 €m Q3 2018 Q3 2017 Q2 2018 CIB PCB AM C&O Group Group Group Revenues 3,025 2,518 567 65 6,175 6,776 6,590 Debt Valuation Adj., DVA (CIB) (58) - - - (58) (7) 56 Gain on sale in GTB (CIB) - - - - - - 57 Valuation of legacy RMBS - - - - - (76) - portfolio (CIB) Sal. Oppenheim w
Slide 28: Specific items - 9M 2018
Specific items - 9M 2018 €m 9M 2018 9M 2017 CIB PCB AM C&O Group Group Revenues 10,449 7,700 1,672 (80) 19,741 20,738 Debt Valuation Adjustment, DVA (CIB) 59 - - - 59 (329) Change in valuation of an investment (CIB) 84 - - - 84 - Gain on sale in GTB (CIB) 57 - - - 57 - Valuation of legacy RMBS portf
Slide 29: Adjusted costs trends – Q3 2018
Adjusted costs(1) trends – Q3 2018 € m, unless stated otherwise Q3 2017 YoY Q2 2018 QoQ Q3 2018 Q3 2017 Q2 2018 ex FX(2) ex FX(2) ex FX(2) ex FX(2) Compensation and benefits(3) 2,833 2,788 2,788 2% 2,994 2,990 (5)% IT costs 939 942 945 (1)% 904 901 4% Professional service fees 358 406 408 (12)% 391
Slide 30: Adjusted costs trends – 9M 2018
Adjusted costs(1) trends – 9M 2018 € m, unless stated otherwise YoY YoY ex FX(2) 9M 2017 9M 2018 9M 2017 abs in % abs in % ex FX(2) Compensation and benefits(3) 8,787 8,783 5 0% 8,600 187 2% IT costs 2,865 2,811 54 2% 2,766 99 4% Professional service fees 1,141 1,248 (106) (9)% 1,216 (75) (6)% Occup
Slide 31: Non-strategic legacy assets in CIB
Non-strategic legacy assets in CIB € bn Risk weighted assets excluding operational risk (37)% 11 Background ― Non-strategic portfolio created to facilitate the run- 7 down of residual CIB assets in the former non-core operations unit and other items not consistent with the CIB strategy 30-Jun-17 30
Slide 32: Level 3 assets
Level 3 assets € bn, as of 30 September 2018 Assets (total: € 23bn) — Level 3 assets arise from the bank’s activities in Mortgage backed securities Equity securities various markets, some of which are less liquid 1 1 — Level 3 assets are mainly booked in core Other 2 businesses 8 Derivative Assets —
Slide 33: Net interest income sensitivity
Net interest income sensitivity € bn, hypothetical +100bps parallel shift impact First year Second year 2.0 1.7 0.9 1.0 1.0 0.8 PCB CIB Group PCB CIB Group > 3M 0.3 0.1 0.3 > 3M 0.6 0.1 0.7 EUR EUR ≤ 3M 0.5 0.7 1.1 ≤ 3M 0.4 0.7 1.0 > 3M 0.0 0.0 0.1 > 3M 0.0 0.1 0.1 USD USD ≤ 3M 0.0 0.1 0.1 ≤ 3M 0.0
Slide 34: Provision for credit losses and stage 3 loans under IFRS 9
Provision for credit losses and stage 3 loans under IFRS 9 Provision for credit losses € mn Stage 3 at amortised cost under IFRS9 € bn Corporate & Investment Bank (CIB) Purchased or Originated Credit Impaired assets (POCI) Private & Commercial Bank (PCB) CIB (ex-POCI) PCB (ex-POCI) Group Stage 3 at
Slide 35: Loan book composition
Loan book composition IFRS loans at amortized cost, 30 September 2018 Corporate & Investment Bank Private & Commercial Bank Leveraged Finance(5) CIB non-strategic ABS CIB Other (4) 5% 1% — Well diversified Loan Portfolio 1% 6% — Over 2/3rds of the loan portfolio in the German Private & Commercial Ba
Slide 36: Litigation update
Litigation update € bn, unless stated otherwise Litigation provisions(1) Contingent liabilities(1) 2.2 2.3 1.4 1.3 30 Jun 2018 30 Sep 2018 30 Jun 2018 30 Sep 2018 ― Decrease predominately due to payments for past ― Includes possible obligations where an estimate can be settlements, releases for lowe
Slide 37: Cautionary statements
Cautionary statements This presentation contains forward-looking statements. Forward-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 pro
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