Investors Day 2007 Achim Kassow

Transcription

1 Investors Day 2007 Private & Business Customers Organic Growth Achim Kassow Member of the Board of Managing Directors Frankfurt, September 20th, 2007

2 Agenda 1. First half year 2007: Good start 2. Strategic program: Organic growth 3. Outlook: Further improvement of profitability 2/ 27

3 Key figures H1 2007: Good start, driven by solid revenue growth * Revenues incl. LLPs in m Solid growth momentum % ,241 1, % Q1 Q2 Q3 Q4 Q1 Q2 H1 H Operating profit in m 118 Strong profit improvement % % Q1 Q2 Q3 Q4 Q1 Q2 H1 H Increased profitability Focus on improving efficiency Operating RoE (Basel I) in % CIR in % Q1 Q2 Q3 Q4 Q1 Q2 H1 H1 Q1 Q2 Q3 Q4 Q1 Q2 H1 H * incl. pro forma integration EH and Asset Management and before one-off charges due to harmonization of provisioning standards CB/EH 3/ 27

4 Focused investments paying off Costs Ø in m Customers in ,166 5,084 5,065 5, ,309 5, ,644 3,611 3,592 3,661 3,704 3, Q1 Q2 Q3 Q4 Q1 Q Personnel expenses Indirect costs Operating expenses Q1 Q2 Q3 Q4 Q1 Q comdirect Cooperations Eurohypo Branches 4/ 27

5 Business growth with stable margins Business volume Ø in bn Margins Ø in % Total margins Q1 Q2 Q3 Q4 Q1 Q Assets (Total lending) Liabilities (Total deposits) Securities (Portfolio volume)* AuM (Assets under Management) * Incl. approx bn AuM of cominvest in each quarter Q1 Q2 Q3 Q4 Q1 Q Assets (Total lending) Liabilities (Total deposits) Securities (Portfolio volume) AuM (Assets under Management) 5/ 27

6 Strategic transformation of Asset Management on track 1. Jupiter, London Disposal took place on June 19 th, CICM Japan, Tokyo Signing of contract on August 28 th, 2007 Closing feasible in H CGG, Wiesbaden Moved from Asset Management Division to Commercial Real Estate Division CCR, Paris CBEI, Dublin Check of strategic options to be finalized until end of 2007 Check of strategic options to be finalized until end of 2007 Transformation from a multi boutique structure to a focussed German Asset Management well advanced within 12 months 6/ 27

7 Agenda 1. First half year 2007: Good start 2. Strategic program: Organic growth 3. Outlook: Further improvement of profitability 7/ 27

8 Private and Business Customer Division continues to focus on affluent customers in Germany D IS T R I B Branchbusiness: Market dynamics Position / USP Strategic program Forecast for German retail market based on GDP growth rate of approx. 2% p.a. Ongoing intensive price competition No.1 for business customers, No. 4 in German branch business / private banking Best bank for sophisticated private customers Leverage platform Sustained growth in target groups Further improvement of cost efficiency U TI O N DirectBanking: Growth in online banking >10% p.a. Enhanced market entries of domestic and foreign banks No. 1 B2C online broker First choice in online banking for modern private investors Grow customer base Further growth in banking, esp. in current accounts and short-term deposits Strengthen best-in-class brokerage position P O R D DU U KC T TI I O N Asset Management: Retail credit: ~9% AuM growth p.a. in German asset management market Growing competition from domestic and foreign asset managers Increasing price competition not only for "good" risks Aggressive direct banking players No. 6 in German asset management with 62bn AuM Active return in core asset classes European bonds and European equities No. 1 in retail credit with overall loan portfolio of 60 bn and No. 2 in home loans with 45bn High service combined with competitive prices Grow asset base Growth program Alpha to invest 100m with target of 100bn AuM until 2011 Focus on performance and third party distribution Increase profitability Optimized credit processing via new platform Risk-return oriented credit portfolio management 8/ 27

9 Market position strengthened Customer base 2006 in % Growth in customer base in % Retail H1/ H1/ Upper Retail 30% 27% Affluent Upper Retail Affluent H1/ H1/ H1/ H1/ % Revenues per customer in Retail % Retail Upper Retail % Personal net income per month Retail (< 1,500) Affluent % Upper Retail ( 1,500-3,000) Affluent (> 3,000) 9/ 27

10 Target 2010: Organic growth driving RoE (Basel I) beyond 23% by addressing four value drivers I. Extend revenue momentum Operating RoE target 2010 x2 23% IV. Reduce capital employed 11% II. Contain cost increases 2006* 2010e III. Reduce risk costs on long-term basis * incl. pro forma integration EH and Asset Management and before one-off charges due to harmonization of provisioning standards CB/EH 10 / 27

11 Profitability improved by customer and volume growth Branch business comdirect Customers in 000 3, % 3,736 Customers in % H1/06 H1/07 Successful growth program with a new market campaign and attacker products (started in Q4/06) 0-Euro-account top of mind in customer recognition; amongst the 2 leading brands with 32% in July 11% market share in small business customers with 10% increase since end of 2004 Private Banking H1/06 H1/07 First choice direct bank for growing number of modern investors Propelled growth with Tagesgeld PLUS (call money plus) accounts (+278%) and current accounts (+14%) in H1/07 cominvest AuM in bn % 28 AuM in bn % 62 H1/06 H1/07 Ongoing business growth in domestic market Focused CEE expansion (Vienna, Prague) incl. off-shore support out of CB Switzerland H1/06 H1/07 More satellite products/become innovation leader, 40 new products/mandates and 1.7 bn net inflows in H1/07 Intensive cooperation with CB in product development/sales Investment performance significantly improved across all asset classes (active return: H1/06: 0.45% vs H1/07: 0.95%) 11 / 27

12 Consistent performance-oriented market communication Promotion trucks Marketing cooperation CB branches opened Saturday Stiftung Warentest Country wide events 13,000 customers p.a. planned 790 branches, 30k prospects, 2.3k new clients Commerzbank test winner Berlin campaign Brand value ranking Call Money Plus Account Börse Online Special marketing campaign targeting Berliner Sparkasse Commerzbank is the achiever of the year with an increased value of about 30% up to 2.093bn comdirect Tagesgeld PLUS introduced November 2006 comdirect: Online Broker of the year 2006 Current Account Online Thomson Extel Survey 2007 uro/finanzen Stiftung Warentest Comdirect: Current account No. 1 in uro/finanzen Best Fund Management Firm in Germany cominvest: Achiever of the year 2007 uro/finanzen Best equity fund in Germany 12 / 27

13 New business makes substantial value contribution Branch business: Initial crossselling current account customers comdirect: Revenues per customer in Acquisition costs/revenues in per new customer Securities accounts Loans 20% Insurance 11% 7% 29% 33% Deposits * * * 137* Cards H Acquisition costs Revenues 40% of all new customers with multiple product sales Revenue structure improved by increase of multiple product sales *annualised Revenues exceeds acquisition costs after 12 months = Net commission income online = commission income offline = Net interest income before provisions 13 / 27

14 Significant efficiency programs under way to balance increase in operating expenses Branch of the Future Service to Perform Retail Credit Asset Management Optimized Branches No. of branches Costs of back offices and IT units in m FTE in credit administration Reduction of fund administration locations 113 >100% >29% 244 ~2,000 >20% ~1, % e e e e Reduction of costs p.a. ~ 12m ~ 100m ~ 40m ~ 8m Total cost savings of approx. 160m p.a. Equals -7.6% of 2006 total cost base in steady state ( 2.1bn) Ongoing efficiency initiatives to support growth programs 14 / 27

15 Lower risk costs will be achieved by higher quality of new business and state of the art loan processing Mortgage business New business ratings in % H1/07 Organisation of loan factory Region 1 Region 2 Region Region New business volume Ø per quarter in m R0 R1 R2 R3 R4 R5 970 New business Improved risk return profile with new business * Small and medium-sized enterprises Margins Øin % 1.00 New business Residential mortgages Consumer loans Private banking loans SME-loans* & other Change from regional to product-oriented organisation Change from one-handed process to processing with specialists for each part of the work flow Implementation of state-of-the-art (risk adjusted) credit evaluation 15 / 27

16 Increased profitability of the residential mortgage book - New business adding value Residential mortgage business with significant profitability increase Decreasing risk costs - Risk-adjusted processing - Portfolio controlling - Improved workout results Decreasing operational costs based on the new credit platform Residential mortgage business: RoE* (in %) RoE: existing business 2006 pro forma Δ 2.1% 2007 forecast 3.0% 5.1% (7.0%**) Risk-adjusted pricing substantially improved RoE: new business Δ 5.5% 2.4% 7.9% (14.0%**) RoE of overall business (existing & new business) significantly increased Mid-term target: RoE (Basel II) > 13% pre tax Δ 2.2% RoE: overall 2.9% 5.1% (7.2%**) *RoE calculated under consideration of Basel I capital **RoE calculated under consideration of estimated Basel II capital (38% relief compared to Basel I) 16 / 27

17 Outlook: Book volume decreasing and stabilizing again after 2010 Development of overall mortgage book volume Expected new business volume in bn Rationale aggressive pricing expected to continue Focus on value adding business resulting in moderate volume growth Expected amounts due in bn Existing structure of credit book shows high volumes for interest rate prolongation for 2008 & 2009 which will allow a reduction of higher risk exposure Expected overall volume in bn Expected overall volume additionally influenced by ordinary and extraordinary repayments Decreasing overall volume until 2010, stabilization afterwards Economic rationale: massive capital reduction plus reduced LLPs plus improved new business triggers increasing RoE 17 / 27

18 Integrated portfolio and capital management introduced Capital employed in bn Single loan portfolio ownership >7.0% >40.0% <1.5 Basel I H1/06 Basel I H1/07 Basel II 2008 Organic decrease of asset portfolio with regard to profitability Approx. 38% reduction of capital requirement through transition towards Basel II Branches as sole point of distribution Single retail loan book allows active portfolio management approach Evaluation of potential alternatives such as sale and securitisation of sub-portfolios or use of synthetic products as well as purchase of portfolios 18 / 27

19 Agenda 1. First half year 2007: Good start 2. Strategic program: Organic growth 3. Outlook: Further improvement of profitability 19 / 27

20 Forecast 2007: Increased profitability Revenues before LLPs in m 2, % 1,384 2,712 app. +4.4% 1,452 2,780-2,880 Operating profit in m >+22% +32% >350 LLPs in m -17.5% app % * * Operating expenses in m 2, % 1,052 2,118 app. +3.6% 1,064 2,180 2,210 Equity tied up , * 2007e 2,634 2,450 2,500 Op. RoE 8.5% 10.9% >14% 2005 H1/ H1/ e * before one-off charges due to harmonization of provisioning standards CB/EH ( 293 m) 20 / 27

21 Rising profitability by mobilisation of all value drivers Value drivers ( m) 2006* H Value drivers: current figures and outlook 2007p (vs. 2006) 2008p- 2010p Outlook Revenues incl. LLPs 2,405 1,312 Extend earnings momentum Reduce risk costs Costs 2,118 1,064 Contain increase by running efficiency programs Focused investment for growth Operating profit Solid increase expected Average equity 2,634 2,514 As of 01/01/2008 Basel II conversion with projected capital reduction of approx. 38% Operating RoE 10.9% 19.8% > 14% 23% i.e. 37% in 2010p according to Basel II given projected capital reduction of approx. 38% * before one-off charges due to harmonization of provisioning standards CB/EH ( 293 m) 21 / 27

22 Appendix 22 / 27

23 Development of operating profit Private and Business Customers Operating profit / ROE Operating expenses / CIR Custom e rs / Gross incom e per customer , in m in % in m in % in '000 5,000 4, in -250 II/06 III/06 IV /06 I/07 II/ II/06 III/06 IV /06 I/07 II/ ,000 II/06 III/06 IV /06 I/07 II/ Operating profit Operating ROE Operating expenses CIR Customers Gross income / customer in m Q II/ 2006 Q III/ 2006 Q IV/ 2006 Q I/ 2007 Q II/ 2007 Q II/07 vs. Q II/06 in % Net interest income Provision for possible loan losses Net commission income Other income* Total income Operating expenses Operating profit Average equity tied up 2,649 2,626 2,586 2,530 2, Operating return on equity (%) %-pts Cost/income ratio in operating business (%) %-pts Gross income** per Ø-customer in Gross income** per Ø-FTE in ' * Trading profit, Net result on investments and securities portfolio, other operating result ** Before provisioning 23 / 27

24 Net interest income Private and Business Customers Lending Deposits Custom e rs / Gross incom e per customer in m 65,000 55,000 45,000 35, in % in m 35,000 33,000 31,000 29, in % in '000 6,000 5,000 4, in 25,000 II/06 III/06 IV /06 I/07 II/ ,000 II/06 III/06 IV /06 I/07 II/ ,000 II/06 III/06 IV /06 I/07 II/ Ø-vol. Ø-margin Ø-vol. Ø-margin Customers Gross income / customer Average in m Margin in % (italics) Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II /2007 Q II /07 vs. Q II /06 in % Home loans fixed* 22, , , , , %-pts Home loans floating* %-pts Loans fixed* 8, , , , , %-pts Loans floating/bill of exchange* 1, , , , , %-pts Consumer loans* 1, , , , , %-pts Others** 1, , , , , %-pts EH Retail Banking 26, , , , , %-pts Total lending 62, , , , , %-pts Sight* 8, , , , , %-pts Time* 4, , , , , %-pts Savings deposits* 10, , , , , %-pts Others** 5, , , , , %-pts Total deposits 29, , , , , %-pts * german branches ** comdirect, CoC RE, CISAL, CB Asia Pacific, CB Sw itzerland 24 / 27

25 Net commission income Private and Business Customers Portfolio volume / Margin Number of current and custody accounts Net com. income per customer 80, , , , in m 70,000 65,000 60,000 II/06 III/06 IV /06 I/07 II/ in % in '000 2,200 2,000 1,800 1,600 II/06 III/06 IV/06 I/07 II/07 in m II/06 III/06 IV /06 I/07 II/07 Net com. income in Ø-portfolio vol. Ø-margin Current accounts Custody accounts Net com. income per customer in m Margin in % (italics) Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II / 2007 Q II/07 vs. Q II/06 in % Average portfolio vol. in m 71, , , , , %-pts Securities transactions Asset Management Payment transactions Loans Bancassurance Other commission income Total net commission income / 27

26 Key performance indicators of business units (1/2) Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II /2007 Q II/07 vs. Q II/06 in % Private and Business Customers Customers (in '000) 4,031 4,013 4,079 4,117 4, Business volume (in m)* 94,673 94,580 96,136 67,442 69, FTE** 6,597 6,602 6,542 6,527 6, Private Banking Customers (in '000) Mandates (in '000) Business volume (in m)* 27,538 27,502 28,171 27,567 28, FTE** Retail Credit Business Customers (in '000) Business volume (in m)* 26,091 25,454 24,739 56,108 55, FTE** comdirect Customers (in '000) Business volume (in m)* 14,696 14,787 15,872 17,569 18, FTE * loans, home loans, deposits, portfolio volume **FTE without head office Customers incl. 0,5 m TUI-Card holders; FTE: per end of the quarter; business volume: average for quarter 26 / 27

27 Key performance indicators of business units (2/2) Assets under management / Net commission income / AuM in bn II/06 III/06 IV /06 I/07 II/ in bps AuM Net commission income / AuM FTE Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II /2007 Q II/07 vs. Q II/06 in % Cominvest* Assets under management Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II /2007 Q II/07 vs. Q II/06 in m in % Cominvest 55,011 57,127 58,094 59,237 61, Assets per asset type Q II /2006 Q III /2006 Q IV /2006 Q I /2007 Q II /2007 Q II/07 vs. Q II/06 in m Equity funds 12,340 12,817 13,888 14,070 15,349 in % 24.4 Bonds 16,531 16,424 16,126 16,709 17, Money market funds 3,762 3,558 3,350 3,509 4, Balanced funds 16,353 16,962 17,428 17,689 16, Fund of funds 2,086 2,215 2,317 2,399 2, Others**/*** 3,939 5,151 4,985 4,861 5, * Integration of MK since Q II / 2006 ** Advisory mandates Cominvest Institutional are allocated to the respective asset types (previously in "Others") *** Funds under advice mandates, guaranteed and capital protection funds 27 / 27

28 Disclaimer All presentations shown at Investors Day based on new group reporting as published per H This presentation has been prepared and issued by Commerzbank AG. This publication is intended for professional and institutional investors only. Any information in this presentation is based on data obtained from sources considered to be reliable, but no representations or guarantees are made by Commerzbank AG and/or its subsidiaries and/or affiliates (herein described as Commerzbank Group) with regard to the accuracy of the data. This presentation also contains forward-looking statements that reflect our current views and expectations about future events. The words anticipate, assume, believe, estimate, expect, intend, may, plan, project, should and similar expressions are used to identify forward-looking statements. These statements are based on plans, estimates and projections as they are currently available to the management of Commerzbank AG. Forward-looking statements therefore speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. By their very nature, forwardlooking statements involve risks and uncertainties. A number of important factors could therefore cause actual results to differ materially from those contained in any forward-looking statement. This presentation is for information purposes; it is not intended to be and should not be construed as an offer or solicitation to acquire, or dispose of any of the securities or issues mentioned in this presentation. Commerzbank Group accepts no responsibility or liability whatsoever for any expense, loss or damages arising out of, or in any way connected with, the use of all or any part of this presentation. Copies of this document are available upon request or can be downloaded from 28 / 27

29 For more information, please contact Commerzbank s IR-team: Jürgen Ackermann (Head of IR) P: M: juergen.ackermann@commerzbank.com Sandra Büschken (Deputy Head of IR) P: M: sandra.bueschken@commerzbank.com Wennemar von Bodelschwingh P: M: wennemar.vonbodelschwingh@commerzbank.com Ute Heiserer-Jäckel P: M: ute.heiserer-jaeckel@commerzbank.com Simone Nuxoll P: M: simone.nuxoll@commerzbank.com Stefan Philippi P: M: stefan.philippi@commerzbank.com Karsten Swoboda P: M: karsten.swoboda@commerzbank.com Andrea Flügel (Assistant) P: M: andrea.fluegel@commerzbank.com 29 / 27

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