The following table sets forth data related to our trading revenues :
| 2003 increase (decrease) from 2002 | ||||
| in € m. | 2003 | 2002 | in € | in % |
| CIB – Sales & Trading (equity) | 2,491 | 513 | 1,978 | 386 |
| CIB – Sales & Trading (debt and other products) | 3,481 | 3,583 | (102) | (3) |
| Other trading revenues1 | (361) | (72) | (289) | N/M |
| Total trading revenues, net | 5,611 | 4,024 | 1,587 | 39 |
| N/M – Not meaningful | |
| 1 | In 2003, other trading revenues included losses of € 285 million from credit default swaps used to hedge our investment-grade loan exposure. |
Our trading and risk management businesses include significant activities in interest rate instruments and related derivatives . Under U.S. GAAP , interest revenues earned from trading assets (e.g., coupon and dividend income), and the costs of funding net trading positions are part of net interest revenues. Our trading activities can periodically shift revenues between trading revenues and interest revenues, depending on a variety of factors, including risk management strategies. In order to provide a more business-focused commentary, we discuss the combined net interest and trading revenues by group division and by product within the Corporate and Investment Bank, rather than by type of revenues generated.
The following table sets forth data relating to our combined net interest and trading revenues by group division and product within Corporate and Investment Bank:
| 2003 increase (decrease) from 2002 | ||||
| in € m. | 2003 | 2002 | in € | in % |
| Net interest revenues | 5,847 | 7,186 | (1,339) | (19) |
| Trading revenues, net | 5,611 | 4,024 | 1,587 | 39 |
| Total net interest and trading revenues | 11,458 | 11,210 | 248 | 2 |
| Breakdown by Group Division/CIB product1 | ||||
| Sales & Trading (equity) | 2,259 | 1,151 | 1,108 | 96 |
| Sales & Trading (debt and other products) | 5,359 | 5,266 | 93 | 2 |
| Total Sales & Trading | 7,618 | 6,417 | 1,201 | 19 |
| Loan products2 | 739 | 1,443 | (704) | (49) |
| Transaction services | 802 | 1,050 | (248) | (24) |
| Remaining products3 | (367) | (428) | 61 | 14 |
| Total Corporate and Investment Bank | 8,792 | 8,482 | 310 | 4 |
| Private Clients and Asset Management | 2,824 | 2,878 | (54) | (2) |
| Corporate Investments | (6) | (29) | 23 | 79 |
| Consolidation & Adjustments | (153) | (121) | (32) | (26) |
| Total net interest and trading revenues | 11,458 | 11,210 | 248 | 2 |
| 1 | Note that this breakdown reflects net interest and trading revenues only. For a discussion of the group divisions’ total revenues by product please refer to “–Results of Operations by Segment”. |
| 2 | Includes the traditional net interest spread on loans as well as the results of credit default swaps used to hedge our investment-grade loan exposure in 2003. |
| 3 | Includes origination, advisory and other products. |
Corporate and Investment Bank (CIB). Combined net interest and trading results from sales and trading products increased by € 1.2 billion with most of the increase due to trading of equities products, reflecting the improved equities markets in 2003. The net interest cost of carrying greater equities positions was more than offset by increased trading revenues from equity derivatives, convertibles, and DB Advisors. Also contributing to the comparative improvement was a material negative result from a single block trade in 2002. Results from loan products decreased by € 704 million. This decline was seen in both net interest and trading and resulted mainly from the reduced net interest earned on lower overall loan volume and negative hedge results on credit default swaps that do not qualify for hedge accounting under SFAS 133 but are used to hedge loan exposures. Results from transaction services were down by € 248 million due to lower interest earned in cash management and a decline in balances following the sale of substantial parts of our Global Securities Services business. Results from remaining products, mainly including goodwill funding costs, were € 61 million better than 2002.
Private Clients and Asset Management (PCAM). Net interest revenues were negatively affected by the sale of most of our insurance businesses and reduced deposit volumes in a low interest rate environment. Somewhat offsetting these factors was increased net interest attributable to the consolidation of entities pursuant to the implementation of FIN 46 in 2003.
The absolute amounts and variances for combined net interest and trading for Corporate Investments and Consolidation & Adjustments were not material.