Commerzbank Ag · XETR:CBK
Commerzbank — Q2 2015 Earnings Presentation
43 slides from Commerzbank's earnings presentation, Aug 3, 2015
Slide 1: Doubling net result in H1 2015 at comfortable capital ratios
Doubling net result in H1 2015 at comfortable capital ratios Analyst conference – Q2 2015 results Stephan Engels | CFO | Frankfurt | 03 August 2015
Slide 2: Summary Q2 2015
Summary Q2 2015 Good operating result of €385m leads to €1.070m in H1 2015 and a net result of €646m – more than doubled compared to H1 2014 (€300m) Core Bank revenues in Q2 2015 with increase of 8% y-o-y – in H1 2015 increase of 14% with all divisions above 2014 despite low interest rate environmen
Slide 3: Milestones since 2012
Commerzbank today with sound and robust Germany based business model 2013 2014 H1 2015 more profitable PC PC turnaround turnaround –– profit profit more more than than doubled doubled vs. vs. H1 H1 2013 2013 increase of operating loan MSB MSB growth growth story story –– loan volume increased by 13%
Slide 4: Key financial figures at a glance
Key financial figures at a glance Q2 2015 vs. Q1 2015 H1 2015 vs. H1 2014 €m 771 685 641 Op. result 1,412 Core Bank 1,070 Financial 940 Result 366 385 Op. result 280 Group 581 646 Net Result1) 300 Q1 2015 Q2 2015 H1 2014 H1 2015 % 10.5 10.5 9.5 9.4 fully phased-in B3 CET 1 Q1 2015 Q2 20152) H1 2014
Slide 5: Group operating result of €385m well above Q2 2014
Group operating result of €385m well above Q2 2014 Quarterly transition, Group €m 685 364 385 105 280 257 186 122 €167m 100 European bank levy in Q1 Operating Operating Revenues LLP Costs Operating Tax, Minorities Net result Net result 1) result result result / Pre-Tax Q2 2015 Q2 2014 1) Q2 2014 Q1
Slide 6: Stable development of expenses at slightly increased level
Stable development of expenses at slightly increased level Costs, Group ∑ 3,425 ∑ 3,692 €m 1,939 1,779 1,753 1,698 1,727 1,722 167 2 950 959 958 984 981 976 1,772 1) 1,751 1) 722 777 763 821 788 770 Q1 Q2 Q3 Q4 Q1 Q2 Personnel expenses Operating expenses 2014 2015 European bank levy Highlights ► H1
Slide 7: LLPs of €280m for the Group – Core Bank still at a low level
LLPs of €280m for the Group – Core Bank still at a low level Provisions for loan losses, Group €m ∑ 495 ∑ 438 341 308 280 257 238 64 251 205 142 134 158 193 97 138 104 90 103 61 Q1 Q2 Q3 Q4 Q1 Q2 NCA Core Bank 2014 2015 Highlights ▲ Low LLPs on Group level driven by high quality of loan book and an
Slide 8: Core Bank: Q2 2015 with a sound performance
Core Bank: Q2 2015 with a sound performance Quarterly transition Operating result, €m 771 10 48 52 641 595 116 76 498 442 -56 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 PC MSB CEE CM O&C Q2 2015 Ø equity (€ bn) 18.6 Ø equity (€ bn) 20.0 Ø equity (€ bn) 22.0 Op. RoE (%) 9.5 Op. RoE (%) 15.4 Op. RoE (%)
Slide 9: Private Customers: Increasing profits underpin successful turnaround
Private Customers: Increasing profits underpin successful turnaround Quarterly transition Operating result, €m +6% 171 161 1 8 17 116 119 111 72 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Revenues LLP Costs Q2 2015 Ø equity (€ bn) 4.3 Ø equity (€ bn) 4.1 Ø equity (€ bn) 4.0 Op. RoE (%) 10.7 Op. RoE (%)
Slide 10: PC divisional split
PC divisional split Filialbank – Revenues before LLP Commerz Real – Revenues before LLP €m ▲ Securities business with €m 778 778 sustainable development thanks 722 to increasing security volumes ▲ Further volume growth in the ▲ Ratio of assets in premium and flagship fund “hausInvest” managed accoun
Slide 11: Mittelstandsbank: Continued high level of operating result
Mittelstandsbank: Continued high level of operating result Quarterly transition Operating result, €m -14% 364 339 342 55 294 269 251 22 29 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Revenues LLP Costs Q2 2015 Ø equity (€ bn) 7.5 Ø equity (€ bn) 8.2 Ø equity (€ bn) 8.1 Op. RoE (%) 14.3 Op. RoE (%) 16.7
Slide 12: MSB divisional split
MSB divisional split Mittelstand Germany – Revenues before LLP Großkunden & International – Revenues before LLP €m €m 349 365 ▲ Stable lending volumes and 333 margins ► Stable development of direct client ► Revenues from deposits 254 259 251 business continue to decrease due to the ▲ Growth in lendi
Slide 13: Central & Eastern Europe: Growth in operating business
Central & Eastern Europe: Growth in operating business while pressure from interest rates and regulatory environment persists Quarterly transition Sale of insurance business Operating result, €m -45% 116 98 93 89 84 46 46 1 64 5 70 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Revenues LLP Costs Q2 2015 Ø
Slide 14: Corporates & Markets: Good performance in challenging global markets
Corporates & Markets: Good performance in challenging global markets Reported Result excl. OCS Quarterly transition result and net CVA/DVA1) Operating result excl. OCS and net CVA/DVA1), €m -43% 254 202 194 130 147 151 144 58 78 2) Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Revenues LLP Costs Q2 2015 2
Slide 15: Corporates & Markets divisional split
Corporates & Markets divisional split Corporate Finance – Revenues before LLPs EMC – Revenues before LLPs (excl. CVA/DVA1)) €m €m ▲ ECM with strong deal activity 265 220 ► DCM with slightly lower 200 ▲ Strongest quarter since 2010 131 128 114 performance with DCM Bonds ▲ High demand for investment a
Slide 16: Core Bank: LLP still at a low level – default portfolio further reduced
Core Bank: LLP still at a low level – default portfolio further reduced LLP split Default volume and coverage €m €m -28% 193 5,743 5,532 16 >100% 4,937 5,087 PC 4,918 Default 4,522 138 Addition to provisions MSB volume 21 61 CEE LLP 2,970 143 2,771 2,690 13 57 C&M Collaterals 35 O&C GLLP 23 24 1,427
Slide 17: NCA: Lower operating result due to valuations, asset run down and portfolio sales
NCA: Lower operating result due to valuations, asset run down and portfolio sales Quarterly transition Operating result, €m >100% -86 154 -174 -185 -184 -252 45 29 -256 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Revenues LLP Costs Q2 2015 Ø equity (€ bn) 8.7 Ø equity (€ bn) 7.6 Ø equity (€ bn) 7.4 EaD
Slide 18: CRE/Ship Finance: Exposure further reduced
CRE/Ship Finance: Exposure further reduced by €1.0bn in CRE and €1.8bn in Ship Finance LLP split €m >100% ▲ Further organic run down of €1.0bn (6%) in CRE and 43% €1.8bn (14%) in Ship Finance including €0.4bn due to FX 65 142 ▲ LLPs in CRE almost completely driven by CRE portfolio Ship 99 sales (€51
Slide 19: RWA decrease due to NCA asset run down and slightly recovered Euro
RWA decrease due to NCA asset run down and slightly recovered Euro RWA (B3 fully phased-in) Operational Risk Credit Risk development and segmental split Market Risk € bn 221.5 214.4 23.1 22.7 NCA 22.5 NCA 20.4 45.5 41.2 Q1 Q2 2015 176.0 171.4 2015 176.1 173.3 Core Bank Core Bank Q1 2015 Q2 2015 High
Slide 20: CET1 ratio fully phased-in of 10.5% including dividend accrual
CET1 ratio fully phased-in of 10.5% including dividend accrual Regulatory capital (CET1 B3 fully phased-in) transition €m 9.4% 9.5% 10.5%2) 0.4 0.1 0.2 22.6 0.3 0.1 0.2 1.4 21.1 20.4 Regulatory Regulatory Capital Net profit Dividend Actuarial Currency Revaluation Others1) Regulatory Capital Capital
Slide 21: Leverage ratio increased to 4.0% fully phased-in
Leverage ratio increased to 4.0% fully phased-in Total assets and LR exposure transition Leverage ratio fully phased-in1) as of Q2 2015 €bn % 605 583 4.0 561 563 3 3.7 50 45 4 3.3 Total Total Total Derivatives SFT Off-B/S Other LR Q2 2014 Q1 2015 Q2 20152) assets assets assets exposure exposure Q2 2
Slide 22: Financial Outlook 2015
Financial Outlook 2015 We will continue on our growth track in the Core Bank and aim to further grow revenues and market share by expanding our customer and asset base We expect Loan Loss Provisions of less than €1bn for 2015 with lower LLPs in NCA as well as in the Core Bank We expect expenses to b
Slide 23: Appendix
Appendix Stephan Engels | CFO | Frankfurt | 03 August 2015 23
Slide 24: German economy 2015/2016 – Economy defies politics (as yet)
German economy 2015/2016 – Economy defies politics (as yet) Current development Our expectation for 2015/2016 Reasons for outperformance › The recovery of the German economy › Recovery will go on as the oil price and › No bubble in the housing market is going on. Annualized growth rate in the weak E
Slide 25: Key figures of Commerzbank share
Key figures of Commerzbank share Figures per share Earnings per share in € Operating result in € 1) 3) EPS (incl. restructuring expenses) 0.32 0.91 0.23 0.18 0.20 0.80 0.11 0.08 0.07 0.08 0.60 0.55 0.23 -0.17 0.09 -0.23 Q12) Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 FY 2013 FY 2014 6M 2015 2013 2014 2015 31 Dec 20
Slide 26: Commerzbank financials at a glance
Commerzbank financials at a glance Group Q2 2014 Q1 2015 Q2 2015 H1 2014 H1 2015 Operating result (€m) 257 685 385 581 1,070 Net result (€m) 100 366 280 300 646 1) CET 1 ratio B3 phase-in (%) 11.7 11.3 12.4 11.7 12.4 2) CET 1 ratio B3 fully phased-in (%) 9.4 9.5 10.5 9.4 10.5 2) Total assets (€bn) 5
Slide 27: Hedging & Valuation adjustments
Hedging & Valuation adjustments €m Q1 14 Q2 14 6M 14 Q3 14 Q4 14 FY 14 Q1 15 Q2 15 PC OCS & Net CVA/DVA - - - - - - - - MSB OCS & Net CVA/DVA 2 14 16 -6 -7 3 20 23 CEE OCS & Net CVA/DVA - -1 -1 - - -2 1 1 OCS -5 -27 -32 15 -40 -56 7 39 C&M Net CVA / DVA 17 19 36 -7 9 37 40 2 OCS & Net CVA/DVA 12 -8
Slide 28: EaD target of €~20bn for CRE and Ship Finance
EaD target of €~20bn for CRE and Ship Finance – Public Finance with held-to-maturity strategy EaD volume of Public Finance portfolio EaD volume of CRE and Ship Finance portfolios €bn as of Q2 2015 €bn as of Q2 2015 PF (mainly CRE (NPL) liquid assets)1) 3.3 CRE Ship Finance (NPL) (lower risk) 2.0 8.9
Slide 29: NCA: Diversified portfolio
NCA: Diversified portfolio EaD (incl. NPL) per 30 June 2015, in €bn GER USA IT POR Other Sum Commercial Performing 7.3 0.1 1.0 1.2 3.5 13.2 EaD RWA Real Estate NPL2) 1.9 0.3 0.1 0.1 1.0 3.3 16.5 12.1 Sum 9.1 0.4 1.1 1.3 4.5 16.5 GER USA IT ES POR Other Sum FI 1.7 0.6 0.1 1.8 0.0 2.9 7.0 Public Sover
Slide 30: NCA: Reduced exposures in all risk clusters
NCA: Reduced exposures in all risk clusters Commercial Real Estate1) Q2/15 Q4/14 Ship Finance Q2/15 Q4/14 Cluster EaD in €bn EaD in €bn • Bulk Carrier (Capesize/VLOC) 0.8 higher 0.4 0.6 • Container < 2,000 TEU 0.2 2.4 2.5 • Hungary 0.2 risk (3%) (4%) • Container 2,000 – 4,000 TEU 0.6 (27%) (27%) • O
Slide 31: Default portfolios CRE and Ship Finance as of 30 June 2015
Default portfolios CRE and Ship Finance as of 30 June 2015 30 June 2015 (31 Dec 2014) 31 Dec 2013 Default portfolio CRE by country | €m Total Germany US Total Default volume 3,287 (3,335) 1,870 (1,796) 316 (283) 5,662 Loan loss provisions 807 (900) 392 (508) 62 (59) 1,882 GLLP 79 (80) 21 (1) 6 (0) 1
Slide 32: Commerzbank Group
Commerzbank Group Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 2,260 2,241 4,501 2,406 1,847 8,754 2,782 2,418 5,200 o/w Total net interest and net trading income 1,538 1,426 2,964 1,595 1,441 6,000 2,017 1,509 3,526 o/w Net commission income 815 782
Slide 33: Core Bank
Core Bank Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 2,219 2,281 4,500 2,330 1,756 8,586 2,666 2,456 5,122 o/w Total net interest and net trading income 1,419 1,501 2,920 1,509 1,357 5,786 1,711 1,502 3,213 o/w Net commission income 810 777 1,587 78
Slide 34: Private Customers
Private Customers Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 874 845 1,719 864 833 3,416 914 915 1,829 o/w Total net interest and net trading income 450 480 930 467 466 1,863 435 468 903 o/w Net commission income 407 361 768 377 393 1,538 459 426 88
Slide 35: Mittelstandsbank
Mittelstandsbank Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 718 743 1,461 744 722 2,927 760 705 1,465 o/w Total net interest and net trading income 443 465 908 449 439 1,796 470 463 933 o/w Net commission income 275 263 538 266 283 1,087 291 262 553
Slide 36: Central & Eastern Europe
Central & Eastern Europe Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 224 233 457 241 225 923 254 208 462 o/w Total net interest and net trading income 156 175 331 179 161 671 155 148 303 o/w Net commission income 57 59 116 51 48 215 47 56 103 o/w Oth
Slide 37: Corporates & Markets
Corporates & Markets Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 541 504 1,045 484 443 1,972 667 531 1,198 o/w Total net interest and net trading income 464 403 867 368 325 1,560 571 406 977 o/w Net commission income 76 101 177 102 89 368 104 99 203
Slide 38: Non-Core Assets
Non-Core Assets Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues 41 -40 1 76 91 168 116 -38 78 o/w Total net interest and net trading income 119 -75 44 86 84 214 306 7 313 o/w Net commission income 5 5 10 10 6 26 5 6 11 o/w Other income -83 30 -53 -20 1 -
Slide 39: Others & Consolidation
Others & Consolidation Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 in € m 2014 2014 2014 2014 2014 2014 2015 2015 2015 Total Revenues -138 -44 -182 -3 -467 -652 71 97 168 o/w Total net interest and net trading income -94 -22 -116 46 -34 -104 80 17 97 o/w Net commission income -5 -7 -12 -7 -10 -29 -6 -10 -16 o/w Othe
Slide 40: Group equity composition
Group equity composition Capital Capital Capital Q1 2015 Q2 2015 Q2 2015 End of period End of period Average €bn €bn €bn 4) Common equity tier 1 B3 capital (phase in) 25.1 26.6 CET1 ratio phase-in: 12.4% Transition adjustments 4.0 4.1 1) Common equity tier 1 B3 capital (fully phased-in) 21.1 22.6 22
Slide 41: 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 € 27.0bn, MSB € 70.6bn, CEE € 15.1bn, C&M € 38.2bn, O&C € 23.8bn, NCA €44.8bn) by a ratio of 10%
Slide 42: 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 43: 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: [email protected] Christoph Wortig (Head of IR Communications) P: +49 69 136 52668 M: [email protected] Insti