Deutsche Bank AG (NYSE:DB) Q3 2018 Earnings Conference Call Transcript

Oct 24, 2018 • 02:00 am ET

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Deutsche Bank AG (NYSE:DB) Q3 2018 Earnings Conference Call Transcript

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Presentation
Operator
James Rivett

Thank you, Emma. Good morning and thank you all for joining us today. On our call, our CEO, Christian Sewing, will speak first; and then, James von Moltke, our CFO, will take you through the earnings presentation in more detail, which is available for download on our website, db.com. After the presentation, we will be happy to take your questions. As always, there's a lot to cover today, so we are going to try to limit it to two questions at a time.

(Forward Looking Cautionary Statements)

With that, let me hand over to Christian.

Executive
Christian Sewing

Thank you, James, and welcome from me. It is my pleasure to host our third quarter results call. Before James takes you through the details of the quarter, I wanted to update you on the progress that we have made this period. Overall, we are on the right path and we are moving in the right direction. Costs and balance sheets are under control. Focus is

now on the top-line. We delivered quickly and in a disciplined manner on what we promised and what is under our direct control. We have been delivering on costs and further improved our already strong balance sheet. We are confident that we will meet our target for adjusted costs of EUR23 billion for the full year. And this also means that we are on

track to be profitable this year for the first time since 2014.

We have made considerable headway on several strategic initiatives this quarter. In our Private & Commercial Bank, the integration of Postbank and the Private & Commercial client business of Deutsche Bank is progressing well in terms of daily execution. And what do I mean by that? We are moving forward with the consolidation of our head office and infrastructure, as well as the harmonization of product management functions across the new legal entity, which will be announced internally shortly. And at the same time, business activity in terms of loan growth is encouraging. And finally, the sale of our Polish operation is on track to complete before year end.

In the Corporate & Investment Bank, we have completed the restructuring of our front office in line with our original target. Further workforce reductions, as we said in July, are now more focused on infrastructure and support functions. This enables us to now focus on profitability and returns also by continuously focusing on client activities. In DWS, we completed the outsourcing of our real estate fund accounting as part of our ongoing cost-efficiency efforts. Since the IPO in the first quarter, DWS has shown strong operating leverage, with adjusted revenues up 3% and adjusted costs down by 5%, leading to close to 30% growth in adjusted pretax profit.

We are dedicated to delivering on our near-term external targets. This quarter, we have made progress against two of the three targets that I set when I became CEO. To recap, those were, first, we promised to continuously meet our near-term cost and headcount targets, second, we