Part of the Consolidated Financial Statements as of 31 December 2006, which were audited by KPMG Deutsche Treuhand AG.

skip to main navigation-menu | skip to language-switch and search form | skip to toolbox (printing and others)

Main Content

Management Report

The following discussion and analysis should be read in conjunction with the consolidated financial statements and the related notes to them. Our consolidated financial statements for the years ended December 31, 2006 and 2005 have been audited by KPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft that issued an unqualified opinion.

Due to rounding, numbers presented throughout this document may not add up precisely to the totals we provide and percentages may not precisely reflect the absolute figures.

THE GROUP AT A GLANCE

 

 

 

2006

2005

Share price at period end

€ 101.34

€ 81.90

Share price high

€ 103.29

€ 85.00

Share price low

€ 80.74

€ 60.90

Dividend per share (proposed for 2006)

€ 4.00

€ 2.50

Basic (Glossary)earnings per share

€ 13.31

€ 7.62

Diluted earnings per share1

€ 11.55

€ 6.95

Average shares outstanding, in m., basic

450

463

Average shares outstanding, in m., diluted

511

509

(Glossary)Return on average total shareholders’ equity (post-tax)

19.5 %

12.5 %

(Glossary)Adjusted return on average active equity (post-tax)2, 3

22.2 %

16.2 %

Pre-tax return on average total shareholders’ equity

26.4 %

21.7 %

Pre-tax return on average active equity3

30.4 %

24.3 %

(Glossary)Cost/income ratio4

70.2 %

74.7 %

 

in € m.

in € m.

Total revenues

28,338

25,640

Provision for loan losses

330

374

Total noninterest expenses

19,883

19,154

Income before income tax expense and cumulative effect of accounting changes

8,125

6,112

Net income

5,986

3,529

 

Dec 31, 2006

Dec 31, 2005

 

in € bn.

in € bn.

Total assets

1,126

992

Loans, net

168

151

Shareholders’ equity

32.8

29.9

(Glossary)BIS core capital ratio (Tier I)

8.9 %

8.7 %

 

Number

Number

Branches

1,717

1,588

thereof in Germany

934

836

Employees (full-time equivalent)

68,849

63,427

thereof in Germany

26,401

26,336

Long-term (Glossary)rating

 

 

Moody’s Investors Service, New York

Aa3

Aa3

Standard & Poor’s, New York

AA–

AA–

Fitch Ratings, New York

AA–

AA–

1

Including effect of dilutive (Glossary)derivatives, net of tax.

2

Net income of € 5,986 million for 2006 and € 3,529 million for 2005 is adjusted for the reversal of 1999/2000 credits for tax rate changes of € (1) million for 2006 and € 544 million for 2005, and cumulative effect of accounting changes, net of tax of € 46 million for 2006.

3

We calculate this adjusted measure of our return on average total shareholders’ equity to make it easier to compare us to our competitors. We refer to this adjusted measure as our “return on average active equity”. However, this is not a measure of performance under (Glossary)U.S. GAAP and you should not compare our ratio to other companies’ ratios without considering the differences in calculation of the ratios. The items for which we adjust the average shareholders’ equity of € 30,765 million for 2006 and € 28,201 million for 2005 are the average unrealized net gains on (Glossary)securities available for sale, net of applicable tax effects of € 2,382 million for 2006 and € 2,023 million for 2005 and the average dividends of € 1,615 million for 2006 and € 1,048 million for 2005. The dividend is paid once a year following its approval by the general shareholders’ meeting.

4

Noninterest expenses as a percentage of net interest revenues before provision for loan losses plus noninterest revenues.