We may have difficulty in identifying and executing acquisitions, and both making acquisitions and avoiding them could materially harm our results of operations and our share price. The international banking and financial services industries are consolidating rapidly. In recent years there has been substantial consolidation in the United States and Europe, regions in which we generate the majority of our revenues. Even though we review the companies we plan to acquire, it is generally not feasible for these reviews to be complete in all respects. As a result, we may assume unanticipated liabilities, or an acquisition may not perform as well as expected. Were we to announce or complete a significant business combination transaction, our share price could decline significantly if investors viewed the transaction as too costly or unlikely to improve our competitive position. If we avoid entering into additional business combination transactions or fail to identify attractive companies to acquire, market participants may, especially in the current climate of consolidation, perceive us negatively.
We may have difficulties selling noncore assets at favorable prices, or at all.
Events at companies in which we have invested may make it harder to sell our holdings and result in material losses irrespective of market developments. Where we hold significant investments in other companies, the effect of losses and risks at those companies may reduce the value of our holdings considerably, including the value of thereof reflected in our financial statements, even where general market conditions are favorable.
Intense competition, especially in our home market of Germany, could materially hurt our revenues and profitability. Competition is intense in all of our primary business areas. We derived approximately 29% of our total net revenues in 2003 from Germany. If we are unable to respond to the competitive environment, we may lose market share in important areas of our business or incur losses on some or all of our activities. In addition, downturns in the German economy could add to the competitive pressure, through, for example, increased price pressure and lower business volumes for us and our competitors.