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Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
THE NEW COMMERZBANK"Roadmap 2012": Focus, optimization, downsizing
1Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Our "Roadmap 2012"
Severe financial and economic crisis and integration of Dresdner Bank
Ourresponse
Strategic three-point program entitled "Roadmap 2012"
Ourobjective
"Hausbank" for private and corporate customers in Germany
Our strategy
We will focus: Create a "client-centric bank" with profitable core business areas
We will optimize: Scale down our credit business secured by mortgages
We will downsize: Maximize value through active management of downsize-portfolios
The challengewe face
2Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Key features of SoFFin II
Cornerstones of SoFFin IIEquity injection of €10bn, thereof
€1.8 bn as shares
€8.2 bn as silent participation (conditions following SoFFin I) Condition for silent participation: German Government has to hold 25% + one share in new Commerzbank
CommitmentsSale of Eurohypo AG within about 5 years
Sale of other subsidiaries:Bankhaus Reuschel & Co. KG, Privatinvest Bank AG, Kleinwort Benson Private Bank Ltd., Dresdner Van Moer CourtensS.A., Dresdner VPV N.V., Allianz Dresdner Bauspar AG
Reduction of group balance sheet total from currently €1,045 bn to approx. €900 bn by 2012 and following sale of Eurohypo to approx. €600 bn
Acquisition ban until end of April 2012
(Non-) price leadership commitment
** SEB, KBC, SG, BNP, Deutsche Bank, Postbank, SCH, BBVA, Lloyds, Erste, Intesa, Unicredit* As of end-March; following Financial Market Stabilization Fund (SoFFin) II and silent participation of Allianz
Commerzbank's capitalization with a Tier 1 ratio of 10.2%* in upper third of peer group**
3Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Overview of our new strategy
FOCUS
OPTIMIZATION
DOWNSIZING
Creation of a "client-centric bank" with profitable core business areas (Private Customers, Mittelstandsbank and CEE)
Ability to generate stable earnings by focussing on core business
Quick integration of Dresdner Bank and cost leadership
Substantial downsizing of investment banking and enhanced client-orientation
Concentrate on client-oriented services
Provide German-focused investment banking products and services with European footprint
Redimensioning our asset-based credit business (Real Estate and Public Finance)
Realign market leader Eurohypo
Retain healthy core business of CRE
Continue pursuit of downsizing strategy in public finance
Value maximization by active management of downsize-portfolios
Ring-fence structured credit products, exotic credit and "credit flow" (proprietary credit trading)
Actively manage portfolios in the Portfolio Restructuring Unit (PRU)
4Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Our new structure
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)** Composition of PRU as of 31.12.2008
FOCUS OPTIMIZATION DOWNSIZING
Mittelstands-bank
Private Customers
Corporates & Markets
CEE Other and consolidation
› Structured credit products**
› Exotic credit
› "Credit Flow" (proprietary credit trading)
The new Commerzbank
Real Estate and Public Finance
126-195N/A521028243CIRin %
337301002121583473RWAin € bn
-20-255-103619-382921Pre tax RoE*in %
-5,444-5,910-909709323-1,5918101,124Op. profitin € m
Total2008
5Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Further expansion of customer franchise, especially in business with smaller corporate clients
Improvement of risk/return profile among mid-sized SMEs
Expansion of cross-border business (in- and outbound) –withdrawal from local foreign business
Financial institutions: leading provider for cash and trade services in Germany and one of the top 3 providers in Europe
Mittelstandsbank: Outlook within our Roadmap 2012… increasing profitability
Goal for 2012Initial situation in 2008Strong year in 2008 with results of around €1,124 m
Combined bank with largest SME portfolio in Germany and market shares, depending on customer segment of 6 - 20%
Financial institutions: holistic support for banks worldwide, specialist for challenging markets due to dense network of representations
43CIR (in %)
73RWA (in € bn)
21Pre tax RoE* (in %)
1,124Operating profit (in € m)
Pro-forma figures 2008
CIR (in %)
RWA (in € bn)
Pre tax RoE* (in %)
>1,500Operating profit (in € m)
Goal for 2012
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)
6Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Mittelstandsbank
Business clients/freelancer
< €2.5 m annual turnover
Own CRM by Private Customer segment
Independent branch structure
MNCs and Institu-tionalsclients
Defined multinational corporatesmainly of DAX- and MDAX
CRM by IB with separate model
Private Customers
Small corp.Win new customer to increase market shareOffering full product rangeSole advisor
Corporates & Markets
Clear corporate customer segmentation based on size and product affinity
Mid-sized corp.Increase of wallet shareFull product range., incl. FE*Being a strategic partner
Large corp.Develop cross sellingProduct range also incl. IBBeing a strategic partner and product manager
Global playersSmall and mid-sized banks in advanced marketsBanks in emerging markets No. 1 provider forCash- and Trade Services forbanks in Germany and No. 3 in Europe Leading partnerfor banks in the Eurozone
Corporate Clients Financial Institutions
Inbound and outbound business with international corporate clients Generating additional revenues via identified market potentialsSelective implementation of our Large Corp business modelBeing with 15 locations in all important markets
InternationalCorporate Clients
Increasing degree of product-complexity
Standardized Solutions
IndividualSolutions
Enlargement of market shares driven by Dresdner acquisitionClear focus on regional support as well as a branch-oriented approachWide range of products, differentiated by customer needs
* Financial Engineering
7Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
~4% ~6% ~11% ~18-20% ~7% ~12%
Customerrelationships
Market share (gross income)
CoBa (old) CoBa (new)
SMEs(Turnover of €2.5-12.5m)
Mid-sized SMEs(Turnover of €12.5-250m)
Large corporate clients(Turnover of >€250m)
Expansion of customer relation-ships to increase the market share in this diversified segment
Selective expansion of customer relationships and increase in share of wallet
Already very high customer penetration; increase in share of wallet
Mittelstandsbank: First choice for small and mid-sized SMEs
CoBa (old) CoBa (new) CoBa (old) CoBa (new)
CoBanew
Double clients
DreBa old
CoBaold
CoBanew
Double clients
DreBa old
CoBaold
CoBanew
Double clients
DreBa old
CoBaold
55%
51%
-6%
100%
76%100%
43%-19%
-48%
100%78%
70%
8Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Local sales unit
Sales unit for large corporates Commerzbank NEW
Expansion of branch network
No. of regional distribution units grow from 85 to 106additionally 44 local sales units
Large corporates serviced by 7 sales units (before 5)
Regional distribution unit Commerzbank NEWRegional distribution unit Commerzbank OLD
Expansion of branch network to optimise client coverageDomestic branch network
Sales unit for large corporates Commerzbank OLD
Densest branch network of all commercial banks in Germany
Setting an international focus
Coverage of important markets in Western Europe (9 locations) and Asia (6 locations)Restructuring of local business
Reliable partner for all international business with Germany
9Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Risk provisioning a main challenge in 2009
Corporates Financial Institutions
Given restructuring competence in the group
Regular liquidity controlling and continuous portfolio reduction
Overall strongest economic downturn since the Great Depression, deep recession expected combined with a slow recovery in the second half (earliest)
In particular Germany with its dependency on foreign trade is affected
Strong increasing corporate insolvencies with the need to restructure single deals
The loan book on the Mittelstandsbank is well diversified with only few identified bulk risks*
GER
MA
NY
INTE
RN
ATI
ON
AL
Expected further charges in the banks´balance sheets driven by the worldwide economic downturn
Consequences due to decreasing country ratings reflecting the deterioration of countries especially in Central and Eastern Europe
Efforts to strengthen the collateral basis with single names
Consistent de-risking and reducing of the portfolio
Concentration on relevant relationship partners needed to support our customers´business
* Definition based on overall LaD, EaD, EL
10Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Key Performance Indicators of Mittelstandsbank
Growth Step-up of revenues
Profitability Boost value adding loan business
Risk Increase quality of risk-volume
1.
2.
3.
Emphasize on commission generating products with low equity allocation, increase cross selling
Growth in the segment of smaller corporates
Stronger focus on risk-adjusted pricing
Positioning for further growth with higher risk-adjusted margins
Increase part of strong value adding products (ICLM, CMIB)
Force collateralization to decrease risk weighted assets
Reduce existing bulk risks
11Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
One bank with one brand for branch bank, combined customer base and product offering
No. 1 retail bank in Germany with closest customer proximity
No. 1 wealth manager in Germany with growing business especially with entrepreneurs
No. 2 in direct banking with strengthened position by expanded range of services
Top 3 in retail credit with lean production factory
Improved cost efficiency due to platform synergies
Private Customers: Market leader in Germany
Goal for 2012Initial situation in 2008In 2008 combined profit of over €800m
Two brands for branch bank
Separated customer bases of combined more than 11m customers
Two separated branch networks with more than 1.500 locations
Different product offerings, systems and processes
82CIR (in %)
34RWA (in € bn)
29Pre tax RoE* (in %)
810Operating profit (in € m)
Pro-forma figures 2008
CIR (in %)
RWA (in € bn)
>30Pre tax RoE* (in %)
Operating profit (in € m)
Goal for 2012
≈
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)
12Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Private Customers: Quantum step in market presence
Branch network: Close to our customersNumber of branches
More than 11 m private customers in GermanyCustomers (in m)
Top 3 position in credit businessCredit volumes (in € bn)
Market leader in investment businessCustomer assets (in € bn)
* German customer base, total global customer base: 14,6m ** Estimate *** Excluding retail portfolio Eurohypo
1,540
HVB
Postbank
Deutsche Bank
New Commerzbank Target: ~ 1,200 branches
HVB**
Postbank Retail
Deutsche Bank
New Commerzbank
ING Diba
HVB
Postbank
ING Diba
New Commerzbank
Deutsche Bank*
~
HVB
Postbank
Deutsche Bank
New Commerzbank***
ING Diba
14.1
>11
~10
6.7
4.3
986
855
846
91
77
66
45
44
230
214
97
91
75
Source: Annual Report.2008
13Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Deposits grew by more than 26 billion euros y-o-y
Number of retail clientsin `000
10.620 10.805 11.028 11.209 11.292
3.2912.7012.149
2.934 3.113
Mar`08 Jun`08 Sep`08 Dez`08 Mar`09
12,769
Clients in PC (without Allianz Banking clients)Clients in CEE
+14.2%
182 185195
206 208
Mar`08 Jun`08 Sep`08 Dez`08 Mar`09
+14.3%
Deposit volume 1)
in € bn
14,58314,32213,96213,506
1) Only retail and corporate customers
14Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Provide German-focused investment banking products and services with European footprint
Client-centric business model for core clients of the bank (no "bank in the bank")
Efficient capital management and reduction of non-core capital intense businesses
Strong sales culture with cautious approach to risk taking
Building on CBC&M chassis enhanced with selected DKIB elements
Two trading-hubs strategy in Frankfurt and London
Corporates & Markets: Client business and risk reduction
Goal for 2012Initial situation in 2008Combination of very different units of customer-oriented Commerzbank and product-oriented DKIB
Global presence through multiple trading hubs
102CIR (in %)
58RWA (in € bn)
-38Pre tax RoE* (in %)
-1,591Operating profit (in € m)
Pro-forma figures 2008
CIR (in %)
RWA (in € bn)
>20Pre tax RoE* (in %)
Operating profit (in € m)
Goal for 2012
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)
15Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
The new CBC&M is a client-focused investment banking house with ~ 1.7x revenues of C&M old
Goal 2012in € bn
CBC&M target business model
Provide German-focused investment banking products and services with European footprint
Client-centric business model for core customers of the bank (no "bank in the bank")
Efficient capital management and reduction of non-core, capital intense businesses, e.g., US, WE
Strong sales culture with cautious approach to risk taking
Building on CoBa C&M chassis enhanced with selected DKIB elements
Two trading-hubs strategy in Frankfurt and London
Excl. PRU
REVENUE
PBT
REG. CAPITAL
FTE
Multiples
C&M old
CBC&M new
2.2
0.9
3.0
~1,500-1,700
x1.7
x2.0
SoP*
x1.4
SoP*
SoP*
x1.4-1.5
* Normalized sum of Parts C&M old and DKIB
16Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Expectation: CEE will exhibit far stronger growth than Western Europe and US once the global recession has come to an end
2009/2010: substantial risk reduction, focused cost-cutting, optimization funding – focus on profitable core business and efficiency gains
CEE: Portfolio optimization
Goal for 2012Initial situation in 2008Record result in 2008 with 10% increase vs. 2007;significant decline in profits in Q4 2008 due to financial market crisis
Substantial increase in loan loss provisions; risk-reduction measures taken at early stage show first results
Launch of efficiency programs
52CIR (in %)
21RWA (in € bn)
19Pre tax RoE* (in %)
323Operating profit (in € m)
Pro-forma figures 2008
CIR (in %)
RWA (in € bn)
Pre tax RoE* (in %)
>350Operating profit (in € m)
Goal for 2012
≈≈
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)
17Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Goal for 2012 Initial situation in 2008
Real Estate and Public Finance: Value recovery and reduction of RWA
Broad coverage of more than 30 markets across the world
Growth strategy
Highly decentralized organization in Germany
Negative operating profit due to higher loan loss provisions and sub-prime write-downs
Generation of stable and predictable contributions to earnings/high RoEs not possible
Major impact of Lehman insolvency and Icelandic banks on portfolio
Holistic offering of financial services
Focus on Germany and Greece
Reduction in new business
Downsizing of portfolio to €60 bn by 2012
Reduction from more than 30 markets today to 10 markets
Target clients in Germany are professional real estate investors and developers from €15 m financing volume upwards
Strong redimensioning and increase in profitability/efficiencyDownsizing of portfolio to maximum €100 bn by 2010; decrease of new business
Funding ensured by ability of using assets as cover fund; refinancing at matching maturities
EUROHYPO (CRE)
PUBLIC FINANCE
SHIPPING
18Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Real Estate and Public Finance:Substantial downsizing of portfolio and significant "de-risking"
RWAin € bn
Shipping
Real Estate**
Public Finance*
2012e2008
17
71
12
17
50
774
100 -25%
* Eurohypo (Public Finance) and other Public Finance** Eurohypo (CRE/ Retail) and other CRE (excluding shipping)
19Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Goal
Portfolio earmarked for downsizing: Active management of €38* bn
Portfolio earmarked for downsizing
Structured credit(ABS, MBS, CDOs, Conduits)
Structured, exotic credit derivatives (Bonds, loans trading, indices, other)
"Credit Flow": loan trading
Not included
SLABS (Government wrapped student loans)
Leveraged Acquisition Financing
Client driven Conduits
Other positions
Comprehensive spin-off of all ABS-related and structured credit portfolios
Additionally all credit run-down portfolios from C&M (focus on core activities)
Systematic reduction of assets to ease pressure on P&L, separated from core operating business
No spin-off of individual assets from core business
Current total marketvalue of ~ €38* bn
* Composition of PRU as of Q1 2009
20Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
"Roadmap 2012" and objectives for the new Commerzbank
≈
≈
FOCUS OPTIMIZATION DOWNSIZING
Mittelstands-bank
Private Customers
Corporates & Markets
CEE Other and consolidation
Real Estate and Public Finance
› Structured credit products
› Exotic credit
› "Credit Flow" (proprietary credit trading)
The new Commerzbank
<60CIRin %
<290RWAin € bn
>20>30Pre tax RoE*in %
>4,000>350>1,500Op. profitin € m
Total2012e
* Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital)
≈
-After tax RoEin % ≈12- - - - -
21Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Our targets (1/3)
Targets for 2009 achieved to date Targets for 2009 to 2011 Longer-term targets
Completion of Dresdner Bank acquisition
Reconciliation of interests and social compensation plan for headquarters in Frankfurt
Recapitalization of the new Commerzbank (SoFFin)
New strategic orientation: "Roadmap 2012"
Integration process on time
22Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Our targets (2/3)
Targets for 2009 achieved to date Targets for 2009 to 2011 Longer-term targets
Reduction in operating expenses significantly under €8 bn
Brand integration completed (Dreba and CoBa)
Return to profitability (break-even before SoFFin)
End-2010
End-2010
2011 at the latest
Planned reduction of silent participations subject to favorable market conditions 2011
23Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Our targets (3/3)
Targets for 2009 achieved to date Targets for 2009 to 2011 Longer-term targets
>€4 bn in sustainable operating profit
RoE target after tax 12%
Reduction of RWAs to <€290 bn (before sale of Eurohypo)
2012
2012
2012
24Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Appendix 1: Backup Mittelstandsbank
25Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Transfer of our domestic relationship approach to Western Europe and Asia
Focus on cross-border business to support our core clients
74% of countries, German exports are going to, are covered by Commerzbank as well as 73% of import-related countries
Restructuring of local business
BarcelonaMailand
Wien
BrüsselLondon
Paris
Madrid
Amsterdam
Zürich
PekingTianjin
Tokyo
Shanghai
Hong Kong
Singapur
Western Europe
Asia
Focus on cross border and restructuring of local business
International
Reliable partner for all international business with Germany
26Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Consistent leadership in financial institutions services worldwide
Full market coverage through network of Representative Offices distributed worldwide
State-of-the-art product range
Synergies through consolidation of locations
Financial Institutions
Sales Unit IAdvanced Markets
4 Locations
Sales Unit IICEE, Russia & CIS
13 Locations
Sales Unit IVMiddle East, Africa,
Latin America12 Locations
Sales Unit IIIAsia
11 Locations
Leverage our leading position in cash-and trade services in Germany and Top 3
providers in Europe
27Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Indepth product know-how offered to our corporate clients…
Cash Management & International Business
(CMIB)
Financial Engineering(FE)
Payments (domestic and international)
Cash & Treasury Management
Documentary Business
Trade services
Investments
- Asset Management- Liquidity Management- Capital Markets (bonds,
structured products)
Risk management
- Derivatives- FX- commodities
Commission generating products
- Pension models (‘Zeit-wertkonten‘)
- Financing of pension obligations
Interest, Currency and Liquditiy Management
(ICLM)
Financing of current assets
Financing of capital investments (incl. Public allowances)
Financial Engineering (FE)
- Structured Finance- Mezzanine Finance- Management of receivables
Investment Banking provided by
Corporates&Markets
EXAMPLES
Equity Capital Market Solutions
Debt Capital Markets / Securitisation
M&A Advisory
Loans used as anchor products for sustainable customer relations
28Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
…and financial institutions
Cash ServicesMoving Money and Securities
Banking ProductsRaising Debt
Market ProductsHedging Risk
Trade ServicesFinancing Trade
Account Management
Commercial Payments
Clearing Services
Payment Enabling
Cheque Services
Direct Debit
EUREX Clearing
Custody Services
Banknote Services
Money Market
Bilateral Loan
Club Deal
Promissory Note (Schuldschein)
Syndicated Loan
Transfer Risk Exempt Loan
Bonds and other debt instruments
Islamic Financing
Asset Securitization
ICLM products
Precious Metals
Commodities
Proprietary Investments
Third Party Investments
Documentary collection
Letter of Credit –Business
Guarantee / Standby Letter of Credit
Supply Chain Financing
Buyers Credit
Forfaiting
EXAMPLES
29Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Appendix 2: ABS Portfolio & Leveraged Acquisition Finance (LAF)
30Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Charges on ABS Portfolio in Q1 2009
* Nominal figures not available, market values are used as a proxy** Markdown-Ratio = 1-(Market Value / Nominal Value)*** Includes drawn and undrawn back-up lines
DetailsThe Q1 2009 charges resulting from ABS portfolio are totalling €1.4bn; thereof €1.2bn as P&L effect and €0.2bn as effect on revaluation reserve
OutlookDue to further shift of financial market crisis to real economy and the weak fundamental situation more charges from ABS portfolio are expected for 2009
Further charges are expected from US CDO of ABS and RMBS (US and Non-US), CMBS and CDO Corporates as well as effects from weak monolinecounterparts concerning protected ABS assets
No significant losses expected with regard to conduit business21%-169-1,192-1,36141,49452,391Total
27%-176-1,192-1,36829,53940,254thereof critical portfolio
1%70711,95512,137thereof other ABS positions
0%0004,5314,531thereof critical portfolio
0%0006,1056,105thereof other conduits
44%-176-622-7989,19916,394thereof critical portfolio
3%7075,8506,032thereof government guaranteed
0%00010,63610,636Conduits***
N/A0-19-19850820CIRC
2%0-15-15584595Others (incl. Term Structures)
0
0
-169
Effect on revaluation
reserve
-64
-472
-622
P&L effect
Overview - ABS portfolioAs of March 2009
33%-79115,04922,426Secondary Market ABS
24%-47211,20014,675ABS Hedge book
-64
Q1-Charges
3,175
Market values
N/A3,239SIV – K2*
Mark-down-
Ratio**
Nominal values(in € m)
31Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Secondary Market ABSDetails
Government guaranteed ABS constitute the largest sub-asset class with market values stable at €5.8bn
Loss drivers: US related assets, Non-US RMBS, CMBS/ CRE CDO and CDO Corporates; markdown ratios of the most critical classes US CDO of ABS and US RMBS currently stand at 75% and 74% respectively
OutlookFurther impact from US related positions expected for 2009 due to unchanged weak economic fundamental situation; other segments will also contribute to this development (e.g. CMBS, Non-US RMBS and CDO Corporates)
30%-80-93-1731,2521,783CMBS/CRE CDO45%-93-92-1851,1822,166CDO Corporates11%1-23-221,0561,192Consumer ABS12%-9-18-27701797SME CDO
20%-58-96-1542,3222,897Non-US RMBS
21%-47-17-641,1181,410Others-169
1091
7
Effect on revaluation reserve
-622
-88-195
0
P&L effect
33%-79115,04922,426Total
3%75,8506,032Government guaranteed
75%-1948343,304US CDO of ABS21
Q1-Charges
734
Market values
74%2,845US RMBS
Mark-down-ratio*Nominal values(in € m)
* Markdown-Ratio = 1-(Market Value / Nominal Value)
Breakdown of products & rating distribution – secondary market ABSAs of March 2009Market values in € bn
16%
4%
10%
63%
8%
BB&worse
BBB
A
AA
AAA
€ 15.0 bn
32Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
ConduitsDetails
Majority of exposure refers to own conduits Silvertower(53%) Beethoven (31%) and Kaiserplatz (12%). 4% refers to third party conduits
Main part of exposure consist of liquidity back-up lines for these conduits (94%), with the remainder stemming from credit enhancement provided by the two banks
OutlookNo losses occurred in Q1 2009 concerning Commerzbank conduits
No significant losses expected with regard to conduit business
0%000647647Equipment Leasing0%000493493Div. Payment Rights0%000566566Capital Commitments0%000524524Rated Securities0%000143143Consumer Loans
0%000984984Film Receivables
0%000721721Others0
000
Effect on revaluation reserve
0
000
P&L effect
0%010,63610,636Total
0%02,5312,531Corporate Loans0%02,6512,651Trade Receivables
0
Q1-Charges
1,376
Market values
0%1,376Auto Loans/Leases
Mark-down-ratio*Nominal values(in € m)
* Markdown-Ratio = 1-(Market Value / Nominal Value)** Includes drawn and undrawn back-up lines
3%
14%
18%
24%
42%
BB&w orse
BBB
A
AA
AAA
Breakdown by productsAs of March 2009Market values in € bn
€ 10.6 bn**
33Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
ABS Hedge BookMonoline asset classes As of March 2009Market values in € bn
DetailsMonoline portfolio stable. About 58% AAA-rated Non-US-RMBS
Non-Monoline hedge book increased due to new positions within a Total Return Swap transaction with a major bank
OutlookSituation and outlook concerning monoline industry has not improved
Dresdner is currently negotiating commutations of monoline-hedged positions. P&L effects possible
30 %0007381,057Corporate CDO70 %000136446Other ABS
Monoline asset classes
9 %000331365Non-US RMBS
55 %0-1-1219490CMBS/CRE CDO
10 %0-20-20614680Other ABS22 %0-74-74163208CMBS/CRE CDO
Non-Monoline asset classes
52 %000445921US CDO of ABS
19 %0-9-9261323US RMBS
0
000
Effect on revaluation reserve
-472
-15-277
-76
P&L effect
24 %-47211,20014,675Total
1 %-765,3975,475Non-US RMBS45 %-2771,9483,542US CDO of ABS
-15
Q1-Charges
948
Market values
19 %1,168Corporate CDO
Markdown-ratio*Nominal values(in € m)
* Markdown-Ratio = 1-(Market Value / Nominal Value)
Non-Monoline asset classes per Ultimo March 2009Market values in € bn
€ 9.3 bn
48%
0%
0%
0%
44%
9%
B & worse
BB
BBB
A
AA
AAA
€ 1.9 bn
0%
2%
1%
15%
76%
6%
B
BB
BBB
A
AA
AAA
34Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
CDA and Counterparty Risk from Monolines
Net counterparty risk from monolinesAs of March 2009in € bn
MtM(Recovery costs)
3.3
CDA
1.8
Development of Counterparty Default Adjustments1)
in € m
1.5
NetCounter-
party Risk
1) CDAs refering to monoline and non-monoline counterparts
9986
102
1,811
12/2005 12/2006 12/2007 12/2008
-13 16
1,709
2006 20072008
2,283
03/2009
472
2009YTD 1,750
533P&L Effect(positive figure = loss)
CDA-MonolinesCDA-Other
CDA total
DetailsM-t-M of derivatives is adjusted to the creditworthiness of the counterparty. The fair value of the derivative needs to be corrected through P&L. Main driver of the increase in Q1 2009 were increased market values of credit derivatives and widening spread curves concerning monolines.P&L effect of €529m refers to monoline counterparts, thereof €453m ABS. The overall gross P&L impact of €529m is partly offset by a release in CDA-adjustments of €57m from non-monoline counterparts (mainly driven by increases in the own credit spread). Thus, net P&L-Impact is €472m.
OutlookFurther P&L impact in 2009 is expected due to restructuring of monolines and / or widening spread curves.
CDA-ratio formonoline
positions at 53%
35Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Portfolio detailsAs of March 2009Market values in € bn
DetailsK2 portfolio decreased due to the termination of liquidity reserves and netting of CDS positions respectively
ABS assets have good quality with 98% currently being investment grade rated
OutlookFurther reduction of K2 portfolio in case of favourable market development
Forced liquidation is not planned
0--
Effect on revaluation reserve
-0.1--
P&L effect
N/A-0.13.23.2Total
N/A-2.8ABSN/A-0.4Non-ABS
Q1-Charges**Market values Markdown-ratioNominal values*(in € bn)
* Nominal figures not available, market values are used as a proxy** P&L effect reflects changes of Net Asset Value (NAV) that is calculated as market value of the assets minus present value of the senior and mezzanine liabilities
Structured Investment Vehicle (SIV) – K2
€ 3.2 bn
2%
2%
91%
5%
BB and below
BBB
AA
AAA
12%
33%
14%
41%
BBB
A
AA
AAA
Ratings of Non-ABS Assets
Ratings of ABS Assets
36Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
€4.8bn
LAFportfolio financing
Leveraged-Loan-CIRCsUnderwriting
Final Hold
7.2
3.8
1.0
0.8
1.6
Italy6%
France4%
The Netherlands5%
UK22% Belgium4%
Rest of Europe15%
Germany 33%
USA11%
Regions
Overall portfolio with focus on Underwriting / Final Hold PortfolioAs of March 2009Exposure at Default in € bn
Daten zu aktualisieren
auf März 2009
Portfolio details*
In Q1 2009 significant specific charges could beavoided in the final hold and underwriting bookthrough active risk managementand close customer contact.
The reduction in volume in the underwriting book issubstantially due to the transfer of transactions to the default portfolio (specific provisions per 12/2008 were made).
In Q1 2009 two CIRCs were restructured / unwoundwithout a loss. Volumes and risk could be reducedsignificantly as a result. Six transactions are still outstanding.
OutlookDue to the high gearing ratios of the companies in the portfolio, they are especially vulnerable to a recession.
In direct LAF business this can lead to furtherburdens on revenues due to specific provisions.
Potential losses concerning CIRCs have beenlimited due to de-risking measures.
For the portfolio financing, downratings, restructurings as well as losses from individualtransactions cannot be excluded.
Leveraged Acquisition Finance (LAF)
* excluding default portfolio
37Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Appendix 3: Update on Integration
38Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
The lead has been taken: full commitment to integration within the entire Bank
Integration cultivates advantages - both banks complement each other strategically (product portfolio, franchise) to create Germany's leading customer bank
EUR 5 bn in cash synergies have been identified for implementation (tbd exceeded)
Integration slated to progress at high speed
Integration: "Growing Together" project running on schedule and making good progress
Dresdner Bank transaction complete – merger finalized on May 11, 2009
Synergies identified
Integration slated to progress at high speed
39Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Integration cultivates advantages - both banks complement each other strategically
Commerzbank
6 million private customers in Germany
3 million private customers in CEE
820 branches in Germany
7% market share in German Mittelstand
Dresdner Bank
5 million private customers in Germany
720 branches in Germany
6% market share in German Mittelstand
New Commerzbank
11 million private customers in Germany
3 million private customers in CEE
With 1,200 branches the largest branch network in Germany (medium-term plan)
11 - 13% market share in German Mittelstand
40Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Cost synergies identified
Planned development as of May 8, 2009 compared with Sept. 1, 2008
Planned development as of May 8, 2009 compared with Sept. 1, 2008Planned development for Sept. 1, 2008Planned development for Sept. 1, 2008
0
10
20
30
40
50
60
70
80
90
100
2009
44%
2010
82%
2011
100%
2012
%
Cost synergies up ~10% on due diligence; Realization on schedule
0
10
20
30
40
50
60
70
80
90
100
2009
45%
2010
84%
2011 2012
%111%
41Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
100% acquisition
Jan 12, 2009
Integration slated to progress at high speed
Phase I:Integration preparation
Phase II: Preparation for integration implementation
Phase III:Integration implementation
MergerMay 11 2009
( )
IT Migration Q4 2010
Beginning of implementation
Q3 2009
› Goals for the new Commerzbank
› Business model/strategy› Organization› Core processes› Synergies/business case
› Preparation for IT implementation
› Technical requirements› Technical design› IT concept
› Works council negotiations› Headquarters - already
negotiated› Region (planned for summer
2009) › Detailed integration planning
› Implementation in target structure
› IT implementation› Target model: CB platform› Reduction of complexity:
significant reduction of IT costs
› Implementation of synergy measures
( )
Employee committee negotiations for headquarters concluded early
42Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Disclaimer
Department
This presentation has been prepared and issued by Commerzbank AG. This publication is intended forprofessional and institutional customers
Any information in this presentation is based on data obtained from sources considered to be reliable, butno representations or guarantees are made by Commerzbank Group with regard to the accuracy of the data. The opinions and estimates contained herein constitute our best judgement at this date and time, and aresubject to change without notice. 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 issuesmentioned in this presentation
Commerzbank AG and/or its subsidiaries and/or affiliates (herein described as Commerzbank Group) mayuse the information in this presentation prior to its publication to its customers. Commerzbank Group or itsemployees may also own or build positions or trade in any such securities, issues, and derivatives thereonand may also sell them whenever considered appropriate. Commerzbank Group may also provide bankingor other advisory services to interested parties
Commerzbank Group accepts no responsibility or liability whatsoever for any expense, loss or damagesarising 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 fromwww.commerzbank.com/aktionaere/index.html
43Markus Beumer Member of the Board of Managing Directors Roadshow Stockholm / Copenhagen June 2009
Jürgen Ackermann (Head of IR)P: +49 69 136 22338M: [email protected]
Sandra Büschken (Deputy Head of IR)P: +49 69 136 23617M: [email protected]
Michael KleinP: +49 69 136 24522M: [email protected]
Wennemar von BodelschwinghP: +49 69 136 43611M: [email protected]
Ute Heiserer-JäckelP: +49 69 136 41874M: [email protected]
Simone NuxollP: +49 69 136 45660M: [email protected]
For more information, please contact Commerzbank´s IR team:Stefan PhilippiP: +49 69 136 45231M: [email protected]
Karsten SwobodaP: +49 69 136 22339M: [email protected]
www.ir.commerzbank.com