Preliminary Q4 2024 Deutsche Bank AG Fixed Income Earnings Call Transcript
Key Points
- Deutsche Bank AG (DB) increased its 2024 pre-provision profit by 19% compared to 2023, driven by revenue momentum and cost discipline.
- Revenues grew by 4% year-on-year, with 75% coming from more predictable revenue streams.
- The corporate bank delivered a return on tangible equity of 13% in 2024, three times its 2021 level.
- The investment bank outperformed its revenue growth target and achieved a RoTE of 9% in 2024.
- Asset management surpassed EUR1 trillion in assets under management for the first time, driven by net inflows of EUR42 billion into passive investments.
- Deutsche Bank AG (DB) faced significant non-operational costs in 2024, predominantly from litigation matters, which masked the underlying strength of the business.
- The investment bank's RoTE of 9% is still below the internal cost of capital, indicating room for improvement.
- Stage 2 loans increased significantly to EUR64 billion, the highest since 2022, raising concerns about potential credit risks.
- The bank's cost-income ratio target for 2025 is below 65%, higher than previously aimed, indicating challenges in cost management.
- FX losses on AT1 calls are a concern, with investors expecting calls despite potential FX impacts.
Ladies and gentlemen, welcome to the Q4 2024 fixed income conference call and live webcast. I'm Sergio, the Chorus Call operator. (Operator Instructions) And the conference is being recorded. (Operator Instructions) The conference must not be recorded for publication or broadcast.
At this time, it's my pleasure to turn over to Philip Teuchner. Philip?
Good afternoon or good morning, and thank you all for joining us today. On the call, our Group Treasurer, Richard Stewart, will take us through some fixed income-specific topics. For the subsequent Q&A session, we also have our CFO, James von Moltke, with us to answer your questions. The slides that accompany the topics are available for download from our website at db.com. After the presentation, we will be happy to take your questions.
Before we get started, I just want to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. Therefore, please take note of
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