Commerzbank Ag · XETR:CBK
Commerzbank — Investor Presentation (June 2004)
18 slides from Commerzbank's investor presentation, Jun 14, 2004
Slide 1: Commerzbank Presentation
Commerzbank Presentation Dr. Eric Strutz Chief Financial Officer Munich June 14, 2004
Slide 2: Restructuring at Commerzbank successfully implemented
1 Restructuring at Commerzbank successfully implemented 1 All business units restructured and ü re-positioned accomplishments 2 Two cost-cutting initiatives successfully ü Strategic implemented 3 All asset portfolios thoroughly reviewed and ü revalued 4 Margins improved ü 5 Capital base strengthened
Slide 3: Commerzbank's measures are paying off
2 Commerzbank’s measures are paying off Operating profit Benchmarking Q1 figures to peer group Operating profit (€m) 435 Adjusted ROE (%) 11.01 10.87 172 194 101 92 2.58 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Commerz- Deutsche HVB bank Bank Earnings per share (€) Cost/income ratio (%) 0.01 0.13 -4.32 -0.08 0
Slide 4: Tier I ratio above target level
3 Tier I ratio above target level RWA, in € bn Tier I ratio, in % 7,7 7,8 7,3 7,4 7,3 7,1 * Target 6,7 7% 6,0 5,9 206 199 178 160 155 150 149 146 141 31 Mar 30 Jun 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep 31 Dec 31 Mrz 2002 2003 2004 *) incl. net result of Q1 2004, ratio would be 7.3%
Slide 5: Major disposals of participations in 2003 and 2004
4 Major disposals of participations in 2003 and 2004 Erste Bank (market placement) Unibanco marketability achieved comdirect through partial sale free float increased Deutsche Börse (global offering) through partial sale (market placement) (accel. bookbuilding) Quarters 2003 I II III IV I 2004 Crédi
Slide 6: Improving results in all core earnings components
5 Improving results in all core earnings components €m Net interest income Loan loss provisions 746 303 705 662 663 718 +2% 273 252 256 238 * -7% +8% -6% Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 *) budgeted 2004: €950m; ¼ = €238m Net commission income Trading profit 314 591 597 27
Slide 7: Commerzbank's loan-loss coverage ratio
6 Commerzbank’s loan-loss coverage ratio In excess: In excess: In excess: € 542m €634m €710m Compared with our peers, 7,711 7,805 coverage ratio of non- 7,388 performing loans remains 110.0% high at 110% 107.9% 109.0% 5,320 5,506 5,576 6,846 7,077 7,095 Loan-loss provision 385 348 353 Country LLP an
Slide 8: Equity allocation within Commerzbank Group
7 Equity allocation within Commerzbank Group Strengthening of growth areas, 31.3.2004, in € m medium-term target 0,972 Corporate customers 0,905 0,556 0,128 Retail Banking Securities 1,154 Group Treasury 10,207 Mortgage banks Others + consolidation 1,768 Asset Management 4,724 ↻ portfolio shift
Slide 9: Retail banking
8 Retail banking in € m Income § Q1 2004: 526 operative ROE 27.6% 477 +14% 463 450 459 pre-tax ROE 27.6% cost/income ratio 71.5% +15% § Provisions exceed Q4 level by €12m – ¼ of budgeted figures Q1 Q2 Q3 Q4 Q1 § Earnings growth no longer 2003 2004 driven by cost-cutting; revenue Operating profit gro
Slide 10: Asset Management
9 Asset Management in € m Income § Q1 2004: 131 operative ROE 37.4% 124 +6% pre-tax ROE 26.6% 104 107 100 cost/income ratio 60.3% +26% § Clear strategic orientation after disposal of foreign subsidiaries and/or reduction of book values Q1 Q2 Q3 Q4 Q1 2003 2004 § Adjusted for seasonal performance fee
Slide 11: Corporate Customers and Institutions
10 Corporate Customers and Institutions in € m § Q1 2004: Income operative ROE 10.0% 469 -9% pre-tax ROE 9.8% 412 429 397 cost/income ratio 49.9% +4% 308 § Only slight increase in interest income due to weak demand for credit Q1 Q2 Q3 Q4 Q1 § Under our "Move to the top“ strategy, our goal is to beco
Slide 12: Domestic corporate customers: value-driven portfolio structuring
11 Domestic corporate customers: Strategy of a value- driven portfolio structuring, re-alignment of organization Portfolio Shift “Mittelstandsoffensive“ “Wertoffensive“ Value Creation RoE Mittelstands- ü Expand business with ü Set-up of five centres for offensive existing clients, build up large cor
Slide 13: 2004 will create the basis for further improvements
12 2004 will create the basis for further improvements • Domestic 20 RoE Corporate domestic in % 17 -turnaround in 2004 15 -target 2006: 17% RoE (pre tax) 10 6 • Europe 5 -after heavy bulk-risk provisions in 2002 (UK) and 0 -6 2003 (France), substantially lower level expected in 2004 and the years a
Slide 14: Securities
13 Securities in € m Income § Q1 2004: 354 operative ROE 41.6% 287 pre-tax ROE 41.6% 254 +23% 232 cost/income ratio 66.1% 162 +53% § At €312m, trading income in Q1 2004 was 1/3 higher than a quarter previously Q1 Q2 Q3 Q4 Q1 2003 2004 § Higher equity allocation due to: Operating profit - increase in
Slide 15: Benefiting from better earnings and lower costs in the three non-core segments
14 Benefiting from better earnings and lower costs in the three non-core segments Others and consolidation operating profit in € m Mortgage banking Treasury 80 -76 -69 117 56 55 54 51 -141 -146 68 -246 38 Q1 Q2 Q3 Q4 Q1 29 6 Q1 Q2 Q3 Q4 Q1 2003 2004 2003 2004 The lower refinancing costs of Q1 Q2 Q3
Slide 16: Commerzbank to sharpen its profile via acquisitions
15 Commerzbank to sharpen its profile via acquisitions String-of-pearls acquisitions Commerzbank’s profile as up to now of today • > 5m retail customers SchmidtBank + 360,000 retail customers • 40% market penetration with + 70 branches German Mittelstand + 2,000 corporate customers • One of top 10 p
Slide 17: Commerzbank's potential by no means exhausted
16 Commerzbank’s potential by no means exhausted § German capital market _ rising commission to regain strength & trading income § Good quality of Commerzbank’s loan portfolio _ lower provisioning § Investments portfolio cleaned up in 2003 _ lower funding costs § Now positive revaluation _ flexible
Slide 18: For more information, please contact
For more information, please contact: Commerzbank Investor Relations Tel. +49 (69) 136 22 33 8 [email protected]