QUOTE AND NEWS
Clusterstock  5 hrs ago  Comment 
The latest round of U.S. sanctions on Russia and the tragedy of Malaysia Airlines flight MH17 in eastern Ukraine have everyone on edge about tensions on the Russia-Ukraine border. "Core issues in the Ukraine crisis remain unresolved," said...
MarketWatch  Jul 18  Comment 
Executives from the Barclays Capital division of Barclays and the Deutsche Bank Securities unit of Deutsche Bank will testify at a Senate Permanent Subcommittee on Investigations hearing about tax avoidance next week. The Tuesday hearing will...
Clusterstock  Jul 18  Comment 
Unemployment fuels unrest and anger. Political instability tends to escalate in regions with lots of economic volatility and limited employment opportunities, particularly for young people. In a new presentation to clients, Deutsche Bank's Raj...
Clusterstock  Jul 18  Comment 
In the wake of yesterday's Malaysia Airlines crash and the start of ground operations by Israeli forces in Gaza, the world is again attuned to the various geopolitical hotspots where risk exists for major conflict to crop up. Deutsche Bank...
Market Intelligence Center  Jul 18  Comment 
MarketIntelligenceCenter.com's patented algorithms have identified an attractive covered-call trade on Deutsche Bank AG (DB). Look at the Oct. '14 $35.00 covered call for a net debit in the $33.63 area. This trade has a duration of 92 days. The...
Financial Times  Jul 16  Comment 
A former salesman at Deutsche Bank’s Japanese unit has been sentenced to 10 months in prison, suspended for three years, for bribing public servants
The Market Financial  Jul 14  Comment 
So here we go again with another banking crisis in the Eurozone. How many times have we heard this phrase over the last few years. This latest disruption is coming from Portuguese bank Banco Espirito Santo, the second largest in the nation. This...
SeekingAlpha  Jul 14  Comment 
By Brian Sanders: Deutsche Bank AG (NYSE:DB) is a foreign regional banking business that offers investment and financial products/services worldwide. It has multiple divisions, including Corporate Banking & Securities, Global Transaction Banking,...




 
TOP CONTRIBUTORS

Deutsche Bank AG (NYSE:DB) is a global financial services firm that offers various financial and investment products to individual, corporate, and institutional clients. Deutsche Bank operates in three divisions: Corporate and Investment Bank, which advises corporate and institutional clients on structuring financial transactions and provides debt and equity issuance; Private Clients and Asset Management, which serves retail and institutional clients and high net worth individuals; and Corporate Investments, which manages the firm’s investments, including its alternative assets. Deutsche Bank’s other offerings include life insurance and mortgage products and services.

Business Overview

Founded in 1870, Deutsche Bank AG was established as an international financial services firm aimed at promoting trading between Germany and other markets throughout Europe and the world. Since then, Deutsche Bank has grown into a leading financial services firm, offering a wide range of financial and related products and services. With nearly 78,000 employees and $2.67 trillion in assets, Deutsche Bank is one of the largest financial institutions in the world.[1]

The firm operates in three divisions:

  • Corporate and Investment Bank (CIB) advises institutional clients on how to structure and execute transactions like mergers and acquisitions. CIB also handles the origination, sale, and trading of equities, debt, and other types of securities.[2]
  • Private Clients and Asset Management (PCAM) provides investment advisory and management services to both institutional and retail investors. Deutsche Bank’s private banking division, which serves high-net-worth individuals and families as well as certain small businesses, also operates within the PCAM segment.
  • Corporate Investments (CI) manages Deutsche Bank’s own investments, including alternative assets like private equity and real estate investments; CI also includes a portfolio of industrial holdings, but these are being eliminated. This segment’s performance depends on changes in the values of its holdings, making it more variable and uncontrollable than Deutsche Bank’s other divisions.

Business & Financial Metrics[3]

In 2009, DB generated a net income of €4.95 billion on revenues of €27.95 billion. This represents a turnaround from 2008, when the company incurred a net loss of €3.90 billion on €13.61 billion in revenues.

Trends and Forces

Declining global M&A activity

When economic conditions take a turn for the worse, fewer firms look to buy and sell other companies, leading to lower revenues for Deutsche Bank and other investment banks that structure these types of transactions. The spreading effects of the credit crunch and the slowdown in the U.S. housing market could drive down the frequency of mergers and acquisitions worldwide. Deutsche Bank would be especially hard hit by a global slowdown in M&A activity since its Corporate and Investment Bank division accounts for well over half of the firm’s pretax income.[4]

Competition

As a diversified financial services firm, Deutsche Bank’s operations span both investment banking and retail banking. Since over half of its profits come from investment banking, however, it’s most often compared to other I-banks such as Goldman Sachs Group (GS), Morgan Stanley (MS), and Merrill Lynch (MER). As Deutsche Bank pares down its retail operations to focus on higher-margin investment banking segments, this comparison will continue to become more appropriate.

References

  1. Deutsche Bank Interim Report as of September 30, 2007 - Fact Sheet
  2. Deutsche Bank Interim Report as of September 30, 2007 - Segmental Results of Operations 9M2007
  3. DB 2009 20-F pg. 2  
  4. Deutsche Bank Annual Report 2006 - Results by Segment
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