Asset & Wealth Management

Combined strength in one unit


Satoshi Arai, Senior Managing Director of Retail Strategy and Services, Nomura Securities, Tokio (photo)

We are proud to work with Deutsche Bank, as they share our belief that clients should be at the heart of every activity. It is important that our partnership be built on this mutual understanding, to ensure that we continue to deliver value for society.

Satoshi Arai,
Senior Managing Director of Retail Strategy and Services, Nomura Securities, Tokio

Regional split of invested assets

Regional split of invested assets (pie chart)

In June 2012, Deutsche Bank announced the establishment of its Asset & Wealth Management (AWM) Corporate Division in order to bring together all of Deutsche Bank’s asset and wealth management activities. As a core business, AWM is one of Deutsche Bank’s four corporate divisions and a strategic pillar of its universal banking model.

The new division combines the former asset management and private wealth management units as well as the passive asset management business and alternative platforms for third-party providers that were previously part of Corporate Banking & Securities. With € 944 billion in assets under management at the end of 2012, AWM ranks among the ten largest bank-owned global asset and wealth managers.

AWM helps individuals and institutions to secure and increase their wealth, while offering traditional and alternative investments across all major asset classes. It also provides customized wealth management solutions and private banking services to high net worth individuals and families as well as select institutions and financial intermediaries.

Building an efficient platform for future growth

The strategic review of certain asset management businesses initiated at the end of 2011 concluded with the recalibration of AWM. As part of Strategy 2015+, AWM launched a program of initiatives to reduce costs and increase revenue growth. The organizational integration will enable us to leverage significant synergies in our front office, business support and infrastructure areas.

Our revenue growth initiatives are focussed on expanding our presence and service offering for ultra high net worth clients, on broadening our client base in emerging markets and on continuing to develop our passive asset management and alternative investment product capabilities.

By combining all of Deutsche Bank’s asset and wealth management activities, we succeeded in enhancing our client service. For example, we created the integrated Global Client Group to give clients comprehensive access to the entire range of AWM’s products and services.

AWM aspires to double the income before income taxes of its operating business from around € 0.8 billion in 2011 to approximately € 1.7 billion in 2015, while increasing assets under management and invested assets to about € 1 trillion.

Excerpt from segment reporting (Asset & Wealth Management1)

The Asset & Wealth Management Corporate Division recorded income before income taxes of € 0.2 billion in 2012 (2011: € 0.9 billion). Noninterest expenses were up by € 975 million and came to € 4.3 billion in 2012. Invested assets in AWM increased over the year by € 32 billion to € 944 billion as of December 31, 2012, mainly driven by market appreciations of € 55 billion and transfers of € 7 billion from Postbank, and primarily offset by outflows of € 22 billion and foreign currency movements of € 7 billion. Wealth Management attracted net inflows of € 15 billion for the year, offset by outflows in Asset Management, particularly from the institutional business following the strategic review.

 

 

 

in € m.

2012

2011

1

Excerpt from segment reporting. For notes and other detailed information, see Financial Report 2012 (Management Report).

Net revenues

4,466

4,277

Total provision for credit losses

18

22

Noninterest expenses

4,288

3,313

Income before income taxes

160

942

Return on equity (pre-tax) in %

3

17

Risk-weighted assets

12,451

14,626

Assets

68,408

68,848

Private investors

DWS Investments (DWS) continued to provide investment solutions that help clients navigate a market environment marked by volatility and low yields. Its global dividend investment fund strategies were very successful, and more than € 3 billion in new money was invested in these funds in 2012. DWS is Europe’s largest manager of dividend funds.

In June 2012, DWS acquired asset management activities of Deutsche Postbank AG, including 56 mutual and special funds, with combined assets of €7 billion.

Institutional investors

Product mix by invested assets

Product mix by invested assets (pie chart)

The strategic review led to significant outflows of funds in 2012. However, capital flows stabilized in the fourth quarter, thanks to new solutions for our clients. An increasing number of these now leverage the full product and service capabilities of Deutsche Bank. In addition, we enhanced the organizational efficiency of AWM’s investment operations for institutional investors.

Deutsche Insurance Asset Management (DIAM) helped insurers meet their investment objectives in the face of persistently low yields. We assist clients in diversifying their portfolios beyond the traditional investments in fixed income securities into other asset classes, including alternative investments.

In Germany, DB Advisors satisfied the strong demand for liability-driven investing as well as asset and liability management solutions.

Alternative investments

In 2012, Deutsche Bank consolidated its alternative investments businesses into one globally integrated platform, also to meet the increased interest in this asset class. AWM now offers institutional and private clients a comprehensive range of alternative investment strategies across the risk/return spectrum, including real estate, hedge funds, infrastructure, commodities and private equity funds.

Wealth Management

Our Wealth Managements services extend from tailored investment products to innovative lending solutions, from wealth planning through inheritance and succession planning to philanthropic advisory services. In 2012, Wealth Management generated net inflows of €15 billion.

AWM expanded on its strong position in the wealth management market in Germany. Our subsidiary Sal. Oppenheim won important client mandates. Euromoney magazine again awarded us the title Best Private Bank in Germany.

In other European countries, our Wealth Management business achieved success not only in acquiring new clients, but also with selective investments in emerging markets. In the UK, AWM further developed its franchise with ultra high net worth clients. In North and South America, our competitive business model and strict cost controls contributed to stable earnings. In the Middle East, AWM added relationship managers and thus expanded coverage. In Asia Pacific, AWM delivered double-digit growth year-on-year for revenues and assets, along with positive net money inflows. Through the close cooperation with CB&S, we succeeded in creating innovative solutions for our clients across a wide range of products.