Key Performance Indicators

Our Strategy 2015+ announcement included several financial targets. These represent the financial Key Performance Indicators (KPIs) of the Group, and are detailed in the table below.

Group Key Performance Indicators

Status end of 2013

Target for 2015

1

Assuming a Group tax rate between 30 % and 35 %.

2

As per end of first quarter 2015.

3

The adjusted pro forma CRR/CRD 4 leverage ratio represents our calculation following the publication of CRR/CRD 4 on June 27, 2013. Further detail on the calculation of this ratio is available in the Risk Report.

Post-tax return on average active equity

1.2 %

Greater than 12 %1

Cost-income ratio

89.0 %

Less than 65 %

Cost savings

€ 2.1 bn per annum

€ 4.5 bn per annum

Costs to achieve savings

€ 1.8 bn

€ 4 bn

CRR/CRD 4 Common Equity Tier 1 capital ratio

9.7 %

Greater than 10 %2

Adjusted pro forma CRR/CRD 4 leverage ratio3

3.1 %

>3 %

Our targets established in Strategy 2015+ in 2012 were based on a number of key assumptions, including normalization/stabilization of asset valuations, revenue growth in line with the market, the absence of fundamental changes to current regulatory frameworks on capital or separation of business activities, global GDP growth in the range of 2 % to 4 % per annum over the period, a EUR/USD exchange rate of approximately 1.30 and the achievement of selective consolidation-driven market share gains.

Cost is one of the key levers of our strategy; costs are one of the most directly controllable aspects of our performance. In context of our Operational Excellence (OpEx) Programm we plan to invest approximately € 4 billion with the aim of achieving full run rate annual cost savings of € 4.5 billion in 2015. We have already invested € 1.8 billion to integrate our business platforms, lowering silos and reducing duplications. We will be investing € 2.2 billion to further consolidate and standardize our systems, to create a more efficient organization and to automate and simplify our processes.

in € bn.

Targeted Investments

Targeted Incremental Savings

2012

0.6

0.4

2013

1.7

1.2

2014

1.5

1.3

2015

0.2

1.6

Total

4.0

4.5

2014 will continue to be a challenging year; we will further focus on disciplined implementation and platform reconfiguration – seeking to reap benefits from the reconfiguration of our core businesses, continue to build a world-class infrastructure and elevate our controls. We are confident of staying on track to reach our target of annual savings for the OpEx Programm.

In addition to targeting annual OpEx savings the Group has a 2015+ target for cost-income ratio of below 65 %. We aim to achieve this target through cost savings and the various initiatives to increase revenue flows across the Corporate Divisions. In 2014 we expect the cost-income ratio to be slightly improved compared to 2013, and due to timing of the various cost savings and revenue generating initiatives we are optimistic to reach our target in 2015.

We aim to achieve a post-tax return on equity of greater than 12 %, and for core businesses of 15 % by the end of 2015. While the post-tax return on equity of 1.2 % in 2013 was impacted by a number of extraordinary items, we expect to make a significant progress from that low level in increasing our return on equity in 2014 towards our target as set in Strategy 2015+.

We remain committed to managing our capital to comply with all regulatory thresholds even in stress scenarios. The CRR/CRD 4 Common Equity Tier 1 capital ratio (CET 1 ratio) stays a management priority. Given our progress on de-risking, we have already reduced our fully loaded CRR/CRD 4 risk-weighted assets significantly. Further reductions are expected for 2014 factoring in a slower pace of de-risking in NCOU as the portfolio decreased in size. Our CET 1 ratio increased to 9.7 % in 2013, within reach of our target of more than 10 % as per end of first quarter 2015. We expect to see some pressure and volatility in this ratio during 2014, impacted by ongoing regulatory refinements, but are confident of reaching our target in 2015.

We are confident of meeting our 2015 objective of a € 500 billion decrease. Progress to date gives us confidence for further reductions in 2014 at approximately the same level as already achieved but we are conscious of the need to adapt to evolving regulatory requirements in this area. For 2014, we expect a moderate move towards our adjusted pro forma CRR/CRD 4 leverage ratio target of more than 3 % in 2015.

We anticipate regulation on both capital and leverage will become clearer. The implementation of a single European regulator is potentially a key step toward a level playing field. The ECB’s Asset Quality Review and Stress Tests are vital steps in that direction, and should bring all-important transparency on the health of bank balance sheets. We are confident these tests will underline the quality of our assets.

We have laid strong foundations for long-term cultural change, by launching our new values and beliefs and significantly tightening our control environment. Our compensation practices have been significantly overhauled. In 2014, adherence to our values and beliefs accounts for 50 % of our variable pay and promotion decisions. Our control model across businesses, control functions and Audit will be further reinforced. We will pursue the strengthening of our control infrastructure and organization and review our business processes for additional risks.


Key figures comparison

Compare key figures of the past years. more