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Deutsche Bank is a leading global investment bank with a strong and profitable private clients franchise. A leader in Germany and Europe, the bank is continuously growing in North America, Asia and key emerging markets. With Euro 992 billion in assets and 63,427 employees, Deutsche Bank offers unparalleled financial services in 73 countries throughout the world. The bank competes to be the leading global provider of financial solutions for demanding clients creating exceptional value for its shareholders and people.

https://www.db.com/company/index.htm

October 26, 2017
Deutsche Bank reports net income of EUR 649 million for the third quarter of 2017
John Cryan, Chief Executive Officer, said: “While the revenue environment remained challenging, we have made significant progress on our key initiatives such as the planned merger of Deutsche Bank and Postbank in Germany as well as the preparation for the IPO of our asset management business. We are convinced that the benefits of our efforts will step by step become more apparent in the coming quarters and years.”
Deutsche Bank’s profits increased significantly both in the quarter and in the first nine months of 2017. For the third quarter, income before income taxes was up by 51% to EUR 933 million, while net income more than doubled to EUR 649 million. For the first nine months of 2017, income before income taxes was up 64% to EUR 2.6 billion while net income more than tripled to EUR 1.7 billion.
Revenues were negatively impacted by a market and interest rate environment which remained challenging. For the third quarter of 2017, net revenues were EUR 6.8 billion, down by 10% year-on-year, or 7% if adjusted for exchange rate movements. Client activity was subdued compared to a strong prior year quarter, while volatility and interest rates remained low.
Cost reductions boosted profit growth. Noninterest expenses were EUR 5.7 billion in the quarter, down by 14%, or 11% if adjusted for exchange rate movements. Restructuring and severance expenses were significantly lower, as were litigation charges, despite the bank successfully resolving a number of litigation matters, largely within existing provisions. Adjusted costs were down 6%, or 3% if adjusted for exchange rate movements, largely reflecting the absence of the Non-Core Operating Unit that was closed last year, and lower professional services fees. Accruals for current-year variable compensation were higher year-on-year. Total headcount fell approximately 4,000 (Full-time equivalent basis) year-on-year.
Credit quality remained high. Provision for credit losses was EUR 184 million, down by 44% versus the prior year quarter, reflecting a broad-based improvement in the Corporate & Investment Bank and continued strong credit quality in the Private & Commercial Bank.
Our capital ratio remains strong. The Common Equity Tier (CET1) ratio (CRR/CRD 4 fully loaded) was 13.8% for the quarter on a fully loaded basis, versus 14.1% in the second quarter. The positive impact of net income on CET1 capital was offset by a required dividend deduction, exchange rate movements and other effects. The leverage ratio (CRR/CRD 4 fully loaded) was 3.8%, stable compared to the previous quarter.
The first nine months of 2017
Revenues for the first nine months were EUR 20.7 billion, down 10%, or 5.5% if adjusted for the impact of debt valuation adjustments and spreads on Deutsche Bank’s own debt. Noninterest expenses were EUR 17.7 billion, a reduction of EUR 2.7 billion or 13%, or 12% if adjusted for exchange rate movements. Adjusted costs were EUR 17.5 billion, down 6%, or 4% on an exchange rate-adjusted basis. Provision for credit losses was EUR 396 million, down by EUR 495 million or 56% versus the first nine months of 2016. The CET1 ratio (CRR/CRD 4 fully loaded) of 13.8% compares with 11.1% at the end of the third quarter of 2016, while the leverage ratio (CRR/CRD 4 fully loaded) improved from 3.5% to 3.8% over the same period.
Third-quarter revenue development in Deutsche Bank’s businesses
Corporate & Investment Bank (CIB): Revenues were EUR 3.5 billion, down 23%, or 21% adjusted for exchange rate movements, reflecting muted client activity and low volatility versus the prior year quarter which saw high levels of client activity post-Brexit. Fixed Income & Currencies (FIC) revenues were down 36%; if reported on the basis of previous segmental reporting, including the relevant revenues now reported in the Financing segment, the year-on-year decline in FIC would have been 24%. Revenues in Equity Sales & Trading and in Origination and Advisory were lower year-on-year, while revenues in Global Transaction Banking (GTB) were lower year-on-year but stable versus the second quarter. GTB’s year-on-year revenue development partly reflected strategic reductions in the business perimeter. CIB has made substantial progress in the repositioning announced earlier in 2017.
Private & Commercial Bank (PCB): Revenues were up 3% year-on-year at EUR 2.6 billion, driven in part by a one-time gain from the sale of shares in Concardis GmbH which was partly offset by the non-recurrence of revenues from the Private Client Services unit, sold in 2016. Adjusting for these items, revenues were stable year-on-year, as growth in fee income mitigated the impact of low interest rates. The merger of Deutsche Postbank AG and Deutsche Bank Privat- und Geschäftskunden AG in the home market is proceeding on schedule, and will create a market leader with approximately 20 million clients and two distinct brands. As announced in March, Deutsche Bank anticipates annual synergies of roughly EUR 900 million from 2022 onwards. The Sal. Oppenheim business will be fully integrated into Deutsche Bank. (For further details relating to the merger of Deutsche Postbank AG and Deutsche Bank Privat- und Geschäftskunden AG please see separate release.)
Deutsche Asset Management: Revenues were EUR 628 million (Adjusted for Abbey Life gross-up), stable year-on-year, partly reflecting a one-off item related to a real estate fund, offset by non-recurring Abbey Life revenues and lower performance and transaction fees. Net new money inflows for the quarter were EUR 4 billion, bringing the total in the first nine months of 2017 to EUR 14 billion. Invested assets were EUR 711 billion, up by EUR 5 billion in the year to date, as exchange rate movements largely offset the positive impact of favourable market developments and positive net money inflows. The partial IPO of Deutsche Asset Management is proceeding on track and is anticipated to take place within the stated 24-month timeframe. Pre-IPO alignment measures are progressing well.
Please find the full media release as PDF for download.
An analyst call to discuss third-quarter 2017 financial results will take place today at 14.00 CEST. This conference call will be transmitted via internet: www.db.com/quarterly-results
A Fixed Income investor call will take place on Thursday, November 2, 2017 at 15.00 CET. This conference call will be transmitted via internet: www.db.com/ir/en/presentations-to-fixed-income-investors.htm
A Financial Data Supplement (FDS), presentation and audio-webcast for the analyst conference call are available at: www.db.com/quarterly-results
 

Deutsche Bank reports core capital ratio of 11.9% despite 2016 full year net loss of EUR 1.4 billion
John Cryan, CEO, said: “Our results for the year 2016 were heavily impacted by decisive management action taken to improve and modernise the bank, as well as by market turbulence for Deutsche Bank. We proved our resilience in a particularly tough year. We finished 2016 with pleasingly strong capital and liquidity ratios and we are optimistic after a promising start to this year.”
Capital ratio was strongest for twelve quarters

Core capital ratio (Common Equity Tier 1, fully loaded) was 11.9% at year-end, up from 11.1% at the end of the third quarter 2016, the strongest for twelve quarters
Common Equity Tier 1 capital (fully loaded) was EUR 42.7 billion, down 3% during the year
Estimated available Total Loss Absorbing Capacity (TLAC) was EUR 116 billion
Risk Weighted Assets (RWA) were reduced by EUR 39 billion to EUR 358 billion during 2016, due primarily to disposals and de-risking of Non-Core Operations Unit (NCOU) and within businesses
Liquidity reserves were EUR 218 billion at year-end, after EUR 200 billion at the end of the third quarter 2016
Revenues came in lower for the year

Revenues in the fourth quarter were EUR 7.1 billion, up 6% year-on-year
Full-year revenues were EUR 30.0 billion, down 10%, reflecting a challenging market environment, persistent low interest rates, Deutsche Bank-specific pressures and strategy execution
Full-year costs decreased

Adjusted costs in the fourth quarter were EUR 6.2 billion, down 9% year-on-year
Full-year adjusted costs were EUR 24.7 billion, down 6%
Noninterest expenses in the fourth quarter were EUR 9.0 billion, stable year-on-year, and included EUR 2.6 billion of charges related to litigation and an impairment on the sale of Abbey Life
Full-year noninterest expenses were EUR 29.4 billion, down 24%, primarily due to lower litigation charges and impairments
Full-year compensation and benefits decreased by 11%, or EUR 1.4 billion, versus 2015
Results reflect costs related to strategy execution

Fourth-quarter net loss was EUR 1.9 billion, versus a net loss of EUR 2.1 billion in the fourth quarter 2015
Full-year net loss was EUR 1.4 billion, versus a net loss of EUR 6.8 billion in 2015
Fourth-quarter pre-tax loss was EUR 2.4 billion, including charges of EUR 2.9 billion related to impairments of goodwill and other intangible assets related to the sale of Abbey Life (EUR 1.0 billion), litigation (EUR 1.6 billion), restructuring and severance (EUR 0.1 billion) and de-risking costs of NCOU (EUR 0.1 billion), as well as gains on disposals of EUR 0.8 billion
Full-year pre-tax loss was EUR 0.8 billion, including charges of EUR 5.8 billion related to the above-mentioned items and gains on disposals of EUR 1.0 billion
Achievements in 2016

De-risking of non-core assets materially complete: NCOU is now closed on schedule
Since creation in 2012, RWA reduction of ~EUR 120 billion, with contribution to core capital ratio of ~200 basis points, before litigation charges
Disposals included stake in Hua Xia Bank, Abbey Life and Private Client Services in the US
Progress in resolution of outstanding litigation matters including settlement with the US Department of Justice (DoJ)
Progress on digitization and technology:
Digital Factory in Frankfurt and Data Hub in Dublin opened
Launch of multi-banking aggregation app
Client downloads of mobile banking apps exceeded 2.7 million by year-end
Reduction of key operating systems and of end-of-life components by ~15%
Ongoing strength in client franchise:
Helped raise EUR 380 billion of debt and equity finance for clients and advised on announced M&A transactions with a value of EUR 320 billion
Leading role in seven out of top ten corporate finance transactions in 2016 as measured by fees (source: Dealogic)
Maintained position as top-5 provider in fixed income sales & trading (source: Coalition ) whilst making further progress on our 2018 de-risking strategy
Transformation of private customer network in Europe on track
Further expanded ETF offering in Deutsche Asset Management
Investing in control environment (Compliance and Anti-Financial Crime) with more than 350 new hires in 2016 and a further 600+ new hires planned in 2017. This is an increase of ~60% over two years
Formation of Intermediate Holding Company, DB USA Corp
The complete press release is available in the download area.
About Deutsche Bank

Deutsche Bank provides commercial and investment banking, retail banking, transaction banking and asset and wealth management products and services to corporations, governments, institutional investors, small and medium-sized businesses, and private individuals. Deutsche Bank is Germany’s leading bank, with a strong position in Europe and a significant presence in the Americas and Asia Pacific.
Disclaimer

This release 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 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.

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, in Europe, 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. Securities and Exchange Commission. Such factors are described in detail in our SEC Form 20-F of 11 March 2016 under the heading “Risk Factors”. Copies of this document are readily available upon request or can be downloaded from www.db.com/ir.

 

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