Deutsche Bank AG (literally
"German Bank") is a global banking and financial services company
with its headquarters in the Deutsche Bank Twin Towers in Frankfurt,
Hesse,
Germany.
It employs more than 100,000 people in over 70 countries, and has a large
presence in Europe, the Americas, Asia-Pacific and the emerging
markets. In 2009, Deutsche Bank was the largest foreign exchange dealer in the world with
a market share of 21 percent.
Deutsche Bank has offices in major
financial centres including London, Madrid, Frankfurt, New York, Paris, Moscow, Amsterdam,
Dublin,
George Town, Cayman Islands, Toronto,
Kuala Lumpur,
São Paulo,
Singapore,
Hong Kong,
Tokyo,
Sydney,
Dubai,
Riyadh,
Mumbai,
Bangkok
and Belgrade.
History
1870-1919
Deutsche
Bank was founded in Berlin in 1870 as a specialist bank for foreign trade. The
bank's statute was adopted on 22 January 1870, and on 10 March 1870 the Prussian
government granted it a banking license. The statute laid great stress on
foreign business: "The object of the company is to transact banking
business of all kinds, in particular to promote and facilitate trade relations
between Germany, other European countries and overseas markets.
The
bank's first domestic branches, inaugurated in 1871 and 1872, were opened in Bremenand Hamburg.
Its first foray overseas came shortly afterwards, in Shanghai (1872) and London
(1873). Already, at this early stage, the bank was looking further afield,
making investments in North and South America, Asia, and Turkey.
Major
projects in the early years of the bank included the Northern Pacific Railroad in the US[
and the Baghdad Railway (1888). In Germany, the bank was
instrumental in the financing of bond offerings of steel company Krupp (1879) and
introduced the chemical company Bayer to the Berlin stock market.
Deutsche
Bank's early decades were a period of rapid expansion. Issuing business began
to grow in importance in the 1880s, and in the 1890s it really took off. The
bank played a major part in the development of Germany's electrical-engineering
industry, but it also gained a strong foothold in iron and steel. A solid base
in Germany permitted the financing of business abroad, which in some cases kept
the bank occupied for years, the best-known example being the Baghdad Railway.
The
second half of the 1890s saw the beginning of a new period of expansion at
Deutsche Bank. The bank formed alliances with large regional banks, giving
itself an entrée into Germany's main industrial regions. Joint ventures were
symptomatic of the concentration then under way in the German banking industry.
For Deutsche Bank, domestic branches of its own were still something of a
rarity at the time; the Frankfurt branch dated from 1886 and the Munich branch
from 1892, while further branches were established in Dresden and Leipzig in
1901.
In
addition, the bank rapidly perceived the value of specialist institutions for
the promotion of foreign business. Gentle pressure from the Foreign Ministry
played a part in the establishment of Deutsche Ueberseeische Bank in 1886 and
the stake taken in the newly established Deutsch-Asiatische Bank three years
later, but the success of those companies in showed that their existence made
sound commercial sense.
When in
spring 1914 the "Frankfurter Zeitung" told its readers that Deutsche
Bank was "the biggest bank in the world",Frankfurter Zeitung, Erstes
Morgenblatt, 5 March 1914. The claim marked the highpoint but at the same time
the end of an era. During World War I, the source of the visionary vigor that
had driven many a determined company to succeed gradually dried up.
1919-1933
The immediate
postwar period was a time of liquidations. Having already lost most of its
foreign assets, Deutsche Bank was obliged to sell other holdings. A great deal
of energy went into shoring up what had been achieved. But there was new
business, too, some of which was to have an impact for a long time to come. The
bank played a significant role in the establishment of the film production
company, UFA, and the merger of Daimler and Benz.
The bank
merged with other local banks in 1929 to create Deutsche Bank und
DiscontoGesellschaft, at that point the biggest ever merger in German banking
history. Increasing costs were one reason for the merger. Another was the trend
towards concentration throughout the industry in the 1920s. The merger came at
just the right time to help counteract the emerging world economic and banking
crisis. In 1937, the company name changed back to Deutsche Bank.
The
crisis was, in terms of its political impact, the most disastrous economic
event of the century. The shortage of liquidity that paralyzed the banks was
fuelled by a combination of short-term foreign debt and borrowers no longer
able to pay their debts, while the inflexibility of the state exacerbated the
situation. For German banks, the crisis in the industry was a watershed. A
return to circumstances that might in some ways have been considered
reminiscent of the "golden age" before World War I was ruled out for
many years.
Deutsche
Bank was one of the major drivers of the collateralized debt obligation
(CDO) market during the housing credit bubble from 2004–2008, creating
~$32,000,000,000 worth. The 2011 US Senate Permanent Select Committee on
Investigations report on Wall Street and the Financial Crisis analyzed Deutsche
Bank as a 'case study' of investment banking involvement in the mortgage
bubble, CDO market, credit crunch, and recession. It concluded that even as the
market was collapsing in 2007, and its top global CDO trader was deriding the
CDO market and betting against some of the mortgage bonds in its CDOs, Deutsche
bank continued to churn out bad CDO products to investors.
The
report focused on one CDO, Gemstone VII, made largely of mortgages from Long
Beach, Fremont, and New Century, all notorious subprime lenders. Deutsche Bank
put risky assets into the CDO, like ACE 2006-HE1 M10, which its own traders
thought was a bad bond. It also put in some mortgage bonds that its own
mortgage department had created but couldn't sell, from the DBALT 2006 series.
The CDO was then aggressively marketed as a good product, with most of it being
described as having A level ratings. By 2009 the entire CDO was almost
worthless and the investors (including Deutsche Bank itself) had lost most of
their money.
Gregg
Lippman, head of global CDO trading, was betting against the CDO market, with
approval of management, even as Deutsche was continuing to churn out product.
He was a large character in Michael Lewis' "The Big Short",
which detailed his efforts to find 'shorts' to buy Credit Default Swaps for the
construction of Synthetic CDOs. He was one of the first traders
to foresee the bubble in the CDO market as well as the tremendous potential
that CDS offered in this. As portrayed in the book "The Big Short" of
Michael Lewis, Lipmann in the mid of the CDO and MBS frenzy was orchestrating
presentations to investors, demonstrating his bearish view of the market,
offering them the idea to start buying CDS, especially to AIG in order to
profit from the forthcoming collapse. As regards the Gemstone VII deal, even as
Deutsche was creating and selling it to investors, Lippman emailed colleagues
that it 'blew', and he called parts of it 'crap' and 'pigs' and advised some of
his clients to bet against the mortgage securities it was made of. Lippman
called the CDO market a 'ponzi scheme', but also tried to conceal some of his
views from certain other parties because the bank was trying to sell the
products he was calling 'crap'. Lippman's group made money off of these bets,
even as Deutsche overall lost money on the CDO market.
Deutsche
was also involved with Magnetar Capital in creating its first Orion
CDO. Deutsche had its own group of bad CDOs called START. It worked with Elliot
Advisers on one of them; Elliot bet against the CDO even as Deutsche sold parts
of the CDO to investors as good investments. Deutsche also worked with John
Paulson, of the Goldman Sachs Abacus CDO controversy, to create
some START CDOs. Deutsche lost money on START, as it did on Gemstone.
Performance
Year
|
2011
|
2010
|
2009
|
2008
|
2007
|
2006
|
2005
|
2004
|
2003
|
Net
Income
|
€4.3bn
|
€2.3bn
|
€5.0bn
|
€-3.9bn
|
€6.5bn
|
€6.1bn
|
€3.5bn
|
€2.5bn
|
€1.4bn
|
|
€33.2bn
|
€28.6bn
|
€28.0bn
|
€13.5bn
|
€30.7bn
|
€28.5bn
|
€25.6bn
|
€21.9bn
|
€21.3bn
|
|
-
|
5%
|
18%
|
-29%
|
30%
|
26%
|
16%
|
1%
|
7%
|
|
-
|
0.75
|
0.75
|
0.5
|
4.5
|
4.0
|
2.5
|
1.7
|
1.5
|
Deutsche
Bank has been transformed over the past five yearsmoving from a German-centric
organisation that was renowned for its retail and commercial presence to a
global investment bank that is less reliant on its traditional markets for its
profitability.
The bank
has been widely recognized for this change and was named International
Financing Review's Bank of the Year twice in a three year period, in 2003 and
2005. It has also won the prize in 2010.
For the
2008 financial year, Deutsche Bank reported its first annual loss in five
decades. despite receiving billions of dollars from its insurance arrangements
with AIG,
including US$11.8 billion from funds provided by US taxpayers
to bail out AIG.
October
2011: Based on a preliminary estimation from the European Banking Authority (EBA), Deutsche
Bank AG needs to raise capital about €1.2 billion (US$1.7 billion) as
part of a required 9 percent core Tier 1 ratio after sovereign debt writedown
starting in mid-2012.
Management structure
Until
recently, there was no CEO at Deutsche Bank. The board was represented by a
“speaker of the board.” Today, Deutsche Bank has a Management Board whose
members are:
Josef
Ackermann (Chairman and CEO)
Hugo Bänziger (Chief Risk Officer)
Anshu Jain
(Corporate and Investment Banking)
Rainer Neske(Private & Business Clients)
The Group
Executive Committee is the Management Board plus the heads of the bank’s other
business areas, namely: Kevin Parker (Asset
Management); and Pierre de Weck (Private
Wealth Management).
The Supervisory
Board of the bank is chaired by Clemens Börsig
We
compete to be the leading global provider of financial solutions, creating
lasting value for our clients, our shareholders, our people and the communities
in which we operate.
Our
mission gives our business a clear purpose and direction. It is rooted in our
brand. Our brand captures and projects a clear idea of who we are.
It is
something against which all our activities – products, services, behavior and
communications – can be judged. It is simple, succinct and unequivocal.
Our claim
has always been much more than a marketing slogan or advertising strapline. It
defines our attitude and will continue to do so. It carries an inclusive
proposition: performance represents all that we do for our clients, not just
bottom-line results. Visually, we say it with more conviction, with more
passion, in a new handwritten style.
Deutsche
Bank’s mission statement is: “We compete to be the leading global provider of
financial solutions, creating lasting value for our clients, our shareholders,
our people and the communities in which we operate.” The bank’s business model
rests on two pillars: the Corporate & Investment Bank (CIB) and Private
Clients & Asset Management (PCAM).
Milestones
Deutsche
Bank was founded in Berlin
in 1870 as a specialist bank for foreign trade. The bank's statute was adopted
on 22 January 1870, and on 10 March 1870 the Prussian
government granted it a banking license. The statute laid great stress on
foreign business: "The object of the company is to transact banking
business of all kinds, in particular to promote and facilitate trade relations
between Germany, other European countries and overseas markets."
The
bank's first domestic branches, inaugurated in 1871 and 1872, were opened in Bremen and Hamburg.
Its first foray overseas came shortly afterwards, in Shanghai (1872) and London
(1873). Already, at this early stage, the bank was looking further afield,
making invest ments in North and South America, Asia, and Turkey.
1905 – 06
Opening of branches in Nuremberg and Augsburg
1909 –10 Opening
of branches in Istanbul and Brussels
1914 Merger with Bergisch Märkische Bank in
Elberfeld and its branches in the Rhineland-Westphalia industrial region
1916 Participation in the Deutsche Ozean-Reederei
and the Mitropa
1917 Merger with Schlesi-scher Bankverein and
Norddeutsche Credit-anstalt
1920 Merger with Hannoversche Bank, Braun-schweiger
Privatbank and Privatbank zu Gotha
1923 Hyperinflation in Germany
1924 – 25 Merger with Württembergische Vereinsbank in
Stuttgart and Essener Credit-Anstalt
1926 Participation in the founding of Lufthansa
and in the merger of Daimler Motoren-Gesellschaft, Stuttgart, with Benz &
Cie., Mannheim, to form Daimler-Benz
1927 Merger with Lübecker Privatbank
1928 Merger with Hildesheimer Bank
1929 Merger of Deutsche Bank and Disconto-Gesellschaft;
the company is now called 'Deutsche Bank und Disconto-Gesellschaft'
1931–32 following
the banking crisis, Deutsche Bank und Disconto-Gesellschaft has to deposit a
third of its share capital with the state-owned Golddiskontbank
Awards
Euromoney
- Private Banking and Wealth Management Survey 2011
The
Corporate Division Private Wealth Management of Deutsche Bank was ranked #1 for
Germany in 20 categories out of the 34 categories in this year's survey,
including:
Best Private Bank
Range of investment products
Range of advisory services
Portfolio management equity
Portfolio management fixed income
Foreign exchange
Lending/Financing Solutions
Real estate investment
Private equity investment
Family office services
Inheritance and succession planning
Specialized services for Entrepreneurs
Philanthropy services
Risk
magazine - Risk Awards 2011
Derivatives
House of the Year - the third time since 2003
Bank Risk Manager of the Year
Derivatives Research House of the Year
Hedge Fund Derivatives House of the Year
Inflation Derivatives House of the Year
The Asset
- Triple A Regional Awards 2010
Best
Equity Deal - AIA
Best IPO - AIA
Best Sovereign Bond - ROP
Best Bank Capital Bond
Best Cross-border M&A
IFR - Awards 2010
Bank of
the Year
Derivatives House
SSAR Bond House
EMEA High-Yield Bond House
Latin America Bond House
EMEA Equity House
Commodity Derivatives House
June 2012
Cannes
Lions 2012
Cannes
Lions – Gold Design Lion in the category “Environmental Design /
Exhibitions & Live Events” for the Anamorphic Mirror
Cannes Lions – Silver Design Lion in the category “Environmental Design /
Exhibitions & Live Events”
May 2012
The Asset
– Triple A Awards 2012
Best
Electronic Banking Solution in Thailand
Integrated Clearing Bank solutions for payments and collections – IATA Thailand
(Role: Provider)
Best in Treasury and Working Capital – Best Multinational Corporation / Large
Corporate Bank in Pakistan
Asiamoney
– Best Domestic Bank Awards 2012
April
2012
AsianInvestor
– Investment Performance Awards 2012
It's the
3rd consecutive year that Deutsche Bank receives this award, which reconfirms
the success of Deutsche's platform year after year.
Deutsche
Bank is one of the world’s largest ETF providers with more than US$40 billion
in assets under management. With more than 240 ETFs in 10 stock exchanges
globally on various asset classes including equities, fixed income, credit
(long/short), money market, currencies and commodities, investors are able to
implement a wide range of market strategies in a transparent, flexible and
efficient manner.
The Asian
Banker – Transaction Banking Awards 2012
Financial-i
– Leaders in Innovation Awards 2011
Leader in
Innovation – Cash Management Provider, Asia
Décideurs
– Leaders de la Finance 2012
Products
Corporate
& Investment Bank
The
Corporate & Investment Bank Group Division, or CIB, is responsible for
Deutsche Bank’s capital markets business, comprising the origination, sales and
trading of capital markets products including debt, equity, and other
securities, together with our corporate advisory, corporate lending and
transaction banking businesses. Our institutional clients come from both the
public sector – for example, sovereign states and international organizations
– and the private sector. We serve the entire range of corporate clients, from
medium-sized businesses to large multinational corporations.
CIB is subdivided into two Corporate Divisions: Corporate Banking &
Securities and Global Transaction Banking.
Corporate
Banking & Securities
Corporate
Banking & Securities comprises our Markets and Corporate
Finance businesses, and covers Deutsche Bank Group’s origination,
sales and trading of securities, corporate advisory and M&A businesses
worldwide, together with other corporate finance activities.
Welcome
to Corporate Finance
As one of
the world's leading investment banks, Deutsche Bank's Corporate Finance
business provides the full range of integrated investment banking products and
services for large-cap and mid-cap corporates, financial institutions,
governments, government agencies, hedge funds and financial sponsors.
We recognise that selecting the right investment banking partner is critical -
especially in these challenging times. Clients need banking partners who are
able to offer stability, insights and global reach. Our relationships are
enhanced by industry sector, country and regional expertise, closely aligned to
high quality client solutions.
Our client offering includes comprehensive financial advisory - including both
buyside and sellside Mergers & Acquisitions (M&A) and restructuring
advisory - and capital raising services, underpinned by one of the world's
largest and most successful debt and equity capital markets platforms, strong
risk management and a global distribution network.
Global
Transaction Banking
Cash
Management & Trade Finance
Deutsche
Bank’s Trade Finance and Cash Management teams provide commercial banking
products and services - for both corporates and financial institutions - that
deal with the management and processing of domestic and cross-border payments,
professional risk mitigation for international trade and asset and liability
management.
Our
customers are supported in their domestic, regional and global trade finance
and cash management programs through Deutsche Bank’s extensive global network
of offices. These are situated in all major and secondary financial markets,
including hubs in Frankfurt, London, New York and Singapore.
A
complete range of robust and reliable solutions are available in Europe, the
Americas and Asia Pacific, including:
db
transaction solutions
db
channel & information solutions
db
liquidity management solutions
db
financial supply chain solutions
db
wholesale solutions
db trade
solutions
db card
solutions
Private
Clients and Asset Management
The
Private Clients and Asset Management Group Division, or PCAM, comprises
Deutsche Bank’s investment management business for both private and institutional
clients, together with our traditional banking activities for private
individuals and small and medium-sized businesses. PCAM consists of two
Corporate Divisions: Asset and Wealth Management and Private & Business
Clients.
Asset and
Wealth Management
Asset and
Wealth Management comprises the Asset Management and Private Wealth Management
Business Divisions.
Asset
Management
Asset
Management (AM) provides retail clients across the globe with mutual fund
products through the DWS Investments franchise. It offers our
institutional clients, including pension funds and insurance companies, a
broad range of services from traditional to alternative investment products.
Private
Wealth Management
Private Wealth Management (PWM) serves
high and ultra high net worth individuals and families as well as selected
institutions. It provides these very discerning clients with a fully integrated
wealth management service, including inheritance planning and philanthropic
advisory services.
Private
& Business Clients
Private &
Business Clients (PBC) provides a broad range of banking services
including current accounts, deposits, loans, investment management and pension
products, to private individuals and self-employed clients as well as small and
medium-sized businesses. Outside of Germany, PBC has had longstanding operations
in Italy, Spain, Belgium
and Portugal
and has been active in Poland for several years now. Furthermore, PBC is
also making focused investments in the growth markets of China
and India.
Market
share
Ordinary
Share
Deutsche
Bank’s share capital consists of common shares issued in registered form
without par value. Under German law, each share represents an equal stake in
the subscribed capital. Therefore, each share has a nominal value of € 2.56,
derived by dividing the total amount of share capital by the number of shares.
Deutsche Bank shares are listed in Germany and in the U.S.A.
In May
1870 Deutsche Bank shares have been traded on the Berlin Stock Exchange for the
first time, since December 8, 1880 the shares have been traded on the Frankfurt
Stock Exchange.
On October 3, 2001 Deutsche Bank started trading its Global Registered Shares
(GRS) on the New York Stock Exchange.
Securities
identification codes
Deutsche
Börse
|
|
Type of
issue
|
Registered
Share
|
Symbol
|
DBK
|
WKN
|
514 000
|
ISIN
|
DE0005140008
|
Reuters
|
DBKGn.DE
|
New York
Stock Exchange
|
|
Type of
issue
|
GRS*
|
Currency
|
U.S.$
|
Symbol
|
DB
|
CINS
|
D
18190898
|
Bloomberg
|
DBK GR
|
* Global Registered Share
|
|
|
|
Date
|
Subscribed
Capital
|
Number
of Shares Issued
|
Market
Capitalisation
|
June
30, 2012
|
EUR
2,379,519,078.40
|
929,499,640
|
EUR
26.5 bn
|
March
31, 2012
|
EUR
2,379,519,078.40
|
929,499,640
|
EUR
34.7 bn
|
December
31, 2011
|
EUR
2,379,519,078.40
|
929,499,640
|
EUR
27.4 bn
|
December
31, 2010
|
EUR
2,379,519,078.40
|
929,499,640
|
EUR
36.3 bn
|
October
6, 2010
capital increase completed
308.6m new reg shs issued more
|
EUR
2,379,519,078.40
|
929,499,640
|
EUR
38.2 bn
|
December
31, 2009
|
EUR
1,589,399,078.40
|
620,859,015
|
EUR
30.7 bn
|
December
31, 2008
|
EUR
1,461,399,078.40
|
570,859,015
|
EUR
15.9 bn
|
December
31, 2007
|
EUR
1,357,824,256.00
|
530,400,100
|
EUR
47.4 bn
|
December
31, 2006
|
EUR
1,343,406,103.04
|
524,768,009
|
EUR
53.2 bn
|
December
31, 2005
|
EUR
1,419,610,291.20
|
554,535,270
|
EUR
45.4 bn
|
December
31, 2004
|
EUR
1,392,266,869.76
|
543,854,246
|
EUR
35.5 bn
|
December
31, 2003
|
EUR
1,489,546,869.76
|
581,854,246
|
EUR
38.2 bn
|
December
31, 2002
|
EUR
1,591,946,869.00
|
621,854,246
|
EUR
27.3 bn
|
December
31, 2001
|
EUR
1,591,215,221.76
|
621,568,446
|
EUR
49.3 bn
|
December
31, 2000
|
EUR
1,578,275,957.76
|
616,514,046
|
EUR
55.2 bn
|
Branches
Deutsche Bank has offices in major financial
centres including London,
Madrid,
Frankfurt,
New York,
Paris,
Moscow,
Amsterdam,
Dublin,
George Town, Cayman Islands, Toronto,
Kuala Lumpur,
São Paulo,
Singapore,
Hong Kong,
Tokyo,
Sydney,
Dubai,
Riyadh,
Mumbai,
Bangkok
and Belgrade
Management
structure and man power
The Group
Executive Committee is the Management Board plus the heads of the bank’s other
business areas, namely: Kevin Parker (Asset
Management); and Pierre de Weck (Private
Wealth Management).
It employs more than 100,000 people in over 70
countries, and has a large presence in Europe, the Americas, Asia-Pacific and
the emerging markets. In 2009, Deutsche Bank was
the largest foreign exchange dealer in the world with
a market share of 21 percent .
Financial
Performance
Facts and
Figures
The
Group at a Glance
|
2011
|
2010
|
Share
price at period end1
|
€ 29.44
|
€ 39.10
|
Share
price high1
|
€ 48.70
|
€ 55.11
|
Share
price low1
|
€ 20.79
|
€ 35.93
|
Basic
earnings per share2
|
€ 4.45
|
€ 3.07
|
Diluted
earnings per share2
|
€ 4.30
|
€ 2.92
|
Average
shares outstanding, in m., basic2
|
928
|
753
|
Average
shares outstanding, in m., diluted2
|
957
|
791
|
Return
on average shareholders’ equity (post tax)
|
8.2 %
|
5.5 %
|
Pre-tax
return on average shareholders’ equity
|
10.2 %
|
9.5 %
|
Pre-tax
return on average active equity3
|
10.3 %
|
9.6 %
|
Book
value per basic share outstanding
|
€ 58.11
|
€ 52.38
|
Cost/income
ratio
|
78.2 %
|
81.6 %
|
Compensation
ratio
|
39.5 %
|
44.4 %
|
Noncompensation
ratio
|
38.7 %
|
37.3 %
|
|
in € m.
|
in € m.
|
Total
net revenues
|
33,228
|
28,567
|
Provision
for credit losses
|
1,839
|
1,274
|
Total
noninterest expenses
|
25,999
|
23,318
|
Income
before income taxes
|
5,390
|
3,975
|
Net
income
|
4,326
|
2,330
|
|
Dec 31,
2011
in € bn.
|
Dec 31,
2010
in € bn.
|
Total
assets
|
2,164
|
1,906
|
Shareholders’
equity
|
53.4
|
48.8
|
Core
Tier 1 capital ratio4
|
9.5 %
|
8.7 %
|
Tier 1
capital ratio4
|
12.9 %
|
12.3 %
|
|
Number
|
Number
|
Branches
|
3,078
|
3,083
|
thereof
in Germany
|
2,039
|
2,087
|
Employees
(full-time equivalent)5
|
100,996
|
102,062
|
thereof
in Germany
|
47,323
|
49,265
|
Long-term
rating
|
|
|
Moody’s
Investors Service
|
Aa3
|
Aa3
|
Standard
& Poor’s
|
A+
|
A+
|
Fitch
Ratings
|
A+
|
AA-
|

SWOT Analysis
SWOT is an acronym for the internal strengths and weaknesses of a firm and the environmental opportunities
and threats facing that firm. It is a technique through which managers create a quick overview of a companies strategic situation.