In 2004, we continued to pursue the four strategic priorities which we defined, in 2003, as the cornerstones of phase two of our transformation strategy. These were as follows:
Maintaining strict cost, capital and risk discipline. We made further progress with the cost savings targeted for 2004. Excluding restructuring costs we reduced our total noninterest expenses by € 0.3 billion compared with the previous year, despite having to absorb special expense items in the fourth quarter of 2004. We were able to hold our BIS capital ratio, at 8.6%, in the upper half of the target range of between 8% and 9%. This reflects extremely efficient capital and risk management – the more so because, at the same time, risk-weighted assets increased slightly in 2004. We also continued to return capital to shareholders, with a proposed dividend increase of 13% to € 1.70 per share and continued share buybacks.
Thanks to sustained profit growth and tight capital management, we were able to increase Deutsche Bank’s return on equity before taxes from 10% to 16% in 2004.
Capitalizing on global leadership in CIB. Deutsche Bank is one of the world’s leading investment banking houses. We have an outstanding platform with highly competent staff and all the critical mass we need in all major business lines and regions. We aim to consolidate this position of strength in order to deliver higher added value for shareholders, clients and staff, and leverage the true potential of our platform through attractive financial products at the best possible terms and conditions.
Delivering profitable growth in PCAM. For PCAM, 2004 was a successful year. The Private & Business Clients Corporate Division achieved its ambitious goal for 2004 by delivering an underlying pre-tax profit in excess of €1billion. Asset Management used 2004 to leverage its strong distribution platform and realigned its management structure towards the end of the year. Thanks to determined efforts, the Private Wealth Management Division increased its market penetration.
