Corporate Banking & Securities Corporate Division (CB&S)


 

Three months ended

Absolute change

Change
in %

in € m.

Mar 31, 2012

Mar 31, 2011

N/M – Not meaningful

Net revenues:

 

 

 

 

Sales & Trading (debt and other products)

3,390

3,691

(301)

(8)

Sales & Trading (equity)

726

943

(218)

(23)

Origination (debt)

379

378

1

0

Origination (equity)

138

181

(42)

(23)

Advisory

121

159

(37)

(24)

Loan products

303

452

(149)

(33)

Other products

162

40

123

N/M

Total net revenues

5,220

5,843

(623)

(11)

Provision for credit losses

85

12

73

N/M

Noninterest expenses

3,412

3,533

(121)

(3)

Noncontrolling interests

6

11

(5)

(43)

Income before income taxes

1,717

2,287

(570)

(25)

Sales & Trading (debt and other products) net revenues were € 3.4 billion in the first quarter 2012, a decrease of € 301 million, or 8 %, compared to the first quarter 2011. While overall performance was strong reflecting increased client activity compared to the second half of 2011, the environment remains less favorable than in the prior year quarter. Revenues in Credit benefited from solid client activity, although these were lower than in the prior year quarter reflecting deliberately lower inventory levels. Money Markets revenues were significantly higher than the prior year quarter across all regions. Revenues in Rates were higher compared to the prior year quarter due to increased client activity in flow and client solutions, generating the second best first quarter ever for the business. Foreign Exchange had record volumes, but revenues were in line with the prior year quarter, reflecting lower margins. Revenues in Emerging Markets were lower than in the prior year quarter with higher flow activity offset by reduced demand for client solutions. Commodities revenues were in line with the prior year quarter, with a strong performance across all products. RMBS revenues were significantly lower than in the prior year quarter, reflecting reduced client demand.

Sales & Trading (equity) generated net revenues of € 726 million in the first quarter 2012, a decrease of € 218 million, or 23 %, compared to the first quarter 2011. While improved market sentiment was reflected in increases across major equity indices, industry-wide client activity remained significantly lower than in the prior year quarter. Equity Trading revenues were lower than in the prior year quarter despite market share increases in Europe and the U.S, reflecting lower industry-wide market volumes as well as the non-recurrence of a gain on the sale of our stake in the Russian stock exchange RTS in the prior year quarter. Equity Derivative revenues were also lower than in the prior year quarter due to reduced flow and corporate volumes. Prime Finance revenues were in line with the prior year quarter, as higher balances were offset by pricing pressures. During the quarter Deutsche Bank was voted number one for European Sales, Trading, and Research in Institutional Investor 2012 All-Europe surveys.

Origination and Advisory generated revenues of € 638 million in the first quarter 2012, a decrease of € 79 million, or 11 %, compared to the first quarter 2011, reflecting lower industry-wide activity. Deutsche Bank was ranked number three globally by share of Corporate Finance fees, its highest ranking ever. Deutsche Bank was also ranked top five across M&A, Equity Origination, and Debt Origination globally. Advisory revenues of € 121 million were down 24 % on the prior year quarter reflecting subdued activity levels compared to the prior year, and Deutsche Bank was ranked number five for the quarter. Debt Origination revenues of € 379 million were in line with the prior year quarter, and Deutsche Bank was ranked number two in All International Bonds and number two in All Bonds in Europe, according to Thomson Reuters. Equity Origination revenues decreased by 23 % to € 138 million compared to the prior year quarter reflecting lower industry-wide equity capital market activity, although issuance levels grew towards the end of the quarter as volatility declined. Deutsche Bank was ranked number five globally in equity issuance and number one in IPOs (Bloomberg). (All rankings sourced from Dealogic unless stated otherwise).

Loan products revenues were € 303 million in the first quarter 2012, a decrease of € 149 million, or 33 %, on the prior year quarter due to the combination of reduced balances, markdowns and the net effect of movements in credit spreads.

Net revenues from other products were € 162 million in the first quarter 2012, an increase of € 123 million from the prior year quarter. This increase was driven by higher mark-to-market gains on investments held to back insurance policyholder claims in Abbey Life, which are offset in noninterest expenses.

Provision for credit losses in CB&S were a net charge of € 85 million in the first quarter 2012 compared to a low net charge of € 12 million in the prior year quarter.

Noninterest expenses were € 3.4 billion in the first quarter 2012, a decrease of € 121 million, or 3 %, compared to the first quarter 2011. This decrease was substantially driven by lower performance related compensation, based on lower operating performance and a reduced deferred compensation charge for employees eligible for career retirement. These decreases were partly offset by approximately € 210 million of litigation related expenses, and the impact of the afore-mentioned effects from Abbey Life.

Income before income taxes in CB&S was € 1.7 billion in the first quarter 2012, compared to € 2.3 billion in the prior year quarter.

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Deutsche Bank Interim Report as of September 30, 2011

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