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Indice: DAX
30
Deutsche Bank is a leading
global investment bank with a strong and profitable private clients franchise.
A leader in Germany and Europe, the bank is continuously growing in North
America, Asia and key emerging markets. With Euro 992 billion in assets
and 63,427 employees, Deutsche Bank offers unparalleled financial services
in 73 countries throughout the world. The bank competes to be the leading
global provider of financial solutions for demanding clients creating exceptional
value for its shareholders and people.
Deutsche
Bank reports second quarter 2006 pre-tax profit of EUR 1.9 billion, up
32%
• Net income of EUR 1.2 billion,
up 29%
• Total revenues of EUR
6.8 billion, up 15%
• Pre-tax return on equity,
per target definition, of 29% for the second quarter, 35% for the first
six months of 2006
• Diluted earnings per share
of EUR 2.17 for the second quarter, EUR 5.57 for the first six months of
2006
• Substantial year-on-year
profit growth in both Corporate and Investment Bank (CIB) and Private Clients
and Asset Management (PCAM)
FRANKFURT AM MAIN, 1 August
2006 – Deutsche Bank (XETRA: DBKGn. DE/
NYSE: DB) reported income
before income taxes of EUR 1.9 billion for the second quarter 2006, up
32% versus the second quarter 2005. Net income was EUR 1.2 billion, up
29%. Reported pre-tax return on average active equity was 29%, compared
to 23% in the prior year quarter. Pre-tax return on average active equity
per the bank’s target definition, which excludes restructuring charges
and substantial gains on the sale of industrial holdings, was 29%, compared
to 25% for the prior year quarter. Diluted earnings per share were up 14%
to EUR 2.17.
For the first six months,
income before income taxes was EUR 4.5 billion, up 40% versus the first
six months of 2005. Net income was EUR 2.9 billion, up 43%, while pre-tax
return on average active equity, per target definition, was 35%, compared
to 29% for the first six months of 2005. Diluted earnings per share were
EUR 5.57, up 37%.
Dr. Josef Ackermann, Chairman
of the Management Board, said: “We proved our ability to deliver in challenging
conditions in the second quarter. Despite volatile markets in May and June,
Deutsche Bank turned in a quarter which was significantly ahead of the
same period in 2005, and as a result, an outstanding first half year.”
He added: “We have built
leading franchises in those areas where we compete. We remain committed
to growth by organic investment and by focused incremental acquisitions.
In both developed and emerging markets across the world, we are well-placed
in areas of long-term strategic potential.”
Group Highlights
Net revenues for the quarter
were EUR 6.8 billion, up 15% versus the second quarter 2005. Revenues in
the Corporate and Investment Bank (CIB) rose 27% to EUR 4.5 billion. Revenues
in Sales and Trading (Debt and other products) were the best ever for a
second quarter, rising 46% to EUR 2.4 billion, against a backdrop of better
markets in credit trading and strong customer activity in the foreign exchange,
money markets and rates businesses. Revenues in Sales and Trading (Equity)
rose 23% to EUR 743 million, with growth in derivatives, cash and prime
services. In challenging equity markets, CIB’s equity proprietary trading
unit gave up some of the gains recorded in the first quarter, resulting
in a second-quarter trading loss, but nevertheless remained solidly positive
for the first six months of 2006. Revenues in Origination and Advisory
rose 33% to EUR 732 million, driven primarily by record revenues in Origination,
with high-yield debt issuance recovering strongly from the challenging
conditions of the second quarter 2005.
Revenues in Private Clients
and Asset Management (PCAM) rose 15% to EUR 2.3 billion, mainly reflecting
substantial performance fees in the real estate Asset Management business,
while revenues in both Private Wealth Management and Private and Business
Clients also grew year-on-year.
For the first six months,
Group net revenues were EUR 14.8 billion, up 18% versus the first six months
of 2005.
Provision for credit losses,
which includes provisions for both loan losses and off-balance sheet positions
(the latter reported in noninterest expense), was EUR 78 million for the
quarter, slightly down from the second quarter 2005. Provision for credit
losses in PCAM grew in line with business growth in consumer lending, while
provision for credit losses in CIB continued to benefit from successful
workouts. Problem loans at the end of the quarter were EUR 3.5 billion,
down from EUR 3.6 billion at the end of the first quarter 2006, the lowest
level for more than five years.
Noninterest expenses for
the quarter were EUR 4.8 billion, compared to EUR 4.4 billion in the second
quarter 2005. The reported cost/income ratio was 71%, down from 75% in
the second quarter 2005, while restructuring charges were EUR 57 million,
down from EUR 116 million. The operating cost base, which excludes restructuring
charges and other items, was EUR 4.8 billion in the second quarter, up
12% versus the second quarter 2005. Compensation costs rose by 17% to EUR
3.1 billion, reflecting higher performance-related compensation, and resulting
in an underlying compensation ratio of 46%, up from 45% in the second quarter
of 2005 but stable compared to the first quarter 2006. Non-compensation
operating costs were EUR 1.7 billion, up by 4% versus the second quarter
2005, reflecting business investments including marketing and promotional
expenses. For the first six months, noninterest expenses were EUR 10.2
billion, up 12% versus 2005, while the operating cost base was EUR 10.1
billion, up 15%, with both increases reflecting higher bonus accruals consistent
with improved operating performance. The underlying cost/income ratio for
the first six months improved to 69%, down from 72% in the first six month
of 2005.
Income before income taxes
for the quarter was EUR 1.9 billion, up 32% versus the second quarter 2005.
Reported pre-tax return on average active equity was 29%, up from 23% in
the prior year period. Per the bank’s target definition (which excludes
restructuring charges of EUR 57 million in the current quarter and EUR
116 million in the second quarter 2005), pre-tax return on average active
equity was 29%, compared to 25% in the prior year period. For the first
six months, pre-tax return on average active equity, per target definition,
was 35% versus 29% in 2005.
Net income for the quarter
was EUR 1.2 billion, up 29% from EUR 947 million in the second quarter
2005. The effective tax rate was 34%, compared to 33% for the second quarter
2005. Diluted earnings per share for the quarter were EUR 2.17, up 14%
versus the second quarter 2005. For the first six months, net income was
EUR 2.9 billion, up 43% versus 2005, while diluted earnings per share were
EUR 5.57, up 37%.
The BIS Tier 1 ratio was
8.7%, compared to 8.8% at the end of the first quarter, and comfortably
within the bank’s target range of between 8 and 9%. Deutsche Bank reaffirmed
its capital management strategy of maintaining core capital strength, funding
business growth, and generating attractive returns for shareholders. The
bank grew its risk position by EUR 6 billion to EUR 263 billion during
the quarter, while also repurchasing 12.3 million shares, at an average
price of EUR 91.03 per share. At the Annual General Meeting on 1 June,
shareholders approved a new buyback program, authorizing the repurchase
of up to a further 10% of outstanding shares, which was started on 2 June
2006, replacing the previous program.
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