Nine-month report

Transcription

1 Nine-month report 2016

2 Key figures of comdirect group Change in % Customers, assets under custody and key products comdirect group* Customers number 3,047,629 2,989, Custody accounts number 1,833,632 1,786, Total assets under custody in million 69,906 65, of which: portfolio volume in million 52,681 49, of which: deposit volume in million 17,225 16, Business-to-customer (B2C) business line Customers number 2,057,075 2,001, Custody accounts number 988, , Current accounts number 1,334,137 1,265, Total assets under custody in million 42,939 39, of which: portfolio volume in million 26,038 24, of which: deposit volume in million 16,901 15, Credit volume in million Business-to-business (B2B) business line Customers number 990, , Custody accounts number 845, , Total assets under custody in million 26,967 25, of which: portfolio volume in million 26,644 25, of which: deposit volume in million Orders and order volume Q1-Q3 Q1-Q3 Executed orders number 17,893,520 17,366, of which: B2C number 10,795,385 11,037, of which: B2B number 7,098,135 6,328, Average order activity per custody account (B2C annualised) number Order volume per executed order (B2C) 1) in 4,470 5, Earnings ratios Q1-Q3 Q1-Q3 Net commission income in thousand 159, , Net interest income before provisions for possible loan losses in thousand 91, , Administrative expenses in thousand 191, , Pre-tax profit in thousand 106,907 77, Net profit in thousand 79,904 56, Earnings per share in Return on equity before tax (annualised) 2) in % Return on equity after tax (annualised) 3) in % Cost/income ratio in % Balance sheet key figures Balance sheet total in million 17,978 16, Equity in million Equity ratio 4) in % Regulatory indicators under CRR/CRD IV 5) Risk weighted assets 6) in million Eligible amount for operational and other risks in million Core capital in million Own funds for solvency purposes in million Own funds ratio 7) in % Employee figures Employees number 1,318 1, Employees full-time basis number 1, , *) B2C: comdirect bank AG; B2B: ebase GmbH 1) Excluding CFD trades 2) Pre-tax profit/average equity (excluding revaluation reserves) in the reporting period 3) After-tax profit/average equity (excluding revaluation reserves) in the reporting period 4) Equity (excluding revaluation reserves)/balance sheet total 5) These figures are calculated on the basis of internal calculations; publication is voluntary and based on national and European implementation rules and the figures are not reported to the Supervisory Authority. The figures are based on a supervisory scope of consolidation formed exclusively for comparison purposes. 6) Risk weighted assets in accordance with Section 113 paragraph 6 CRR of the German Banking Act (KWG) (intragroup receivables are zero weighted) 7) Own funds for solvency purposes/(risk weighted assets x eligible amounts for operational and other risks)

3 Foreword 1 Dear Shareholders, Dear Friends of comdirect, After nine months, the comdirect group is well on the way to achieving its 2016 target a return on equity of more than 19%. This would correspond to a pre-tax profit of more than 110m. However, the market did not move in our favour over the summer months trading increasingly flattened after digesting the Brexit shock, while the ECB s pressure on market interest rates and bond rates is making the deposit business unattractive for banks. Active management of other administrative expenses enabled us to partially compensate for these effects. This allows us to ensure an attractive result for our shareholders, while at the same time empowering us to drive forward the bank s strategic development into a smart financial assistant in our customers lives. Those who wish to maintain their customers over the long term must know their needs and offer them smart solutions. We are convinced that today s customers want a full overview of their finances at all times and wherever they are, with just a few clicks, and that they expect tailored and simple solutions for their banking transactions. And it is just these things that we have been implementing over the recent weeks, and in doing so setting three benchmarks as a pioneer in the industry: With its multi-banking service, comdirect is one of the first banks to have become a digital financial centre, through which customers can access their bank accounts, credit cards and custody accounts across all of their banks in the Personal Area of the comdirect website. Our new MoBox app provides young people with smart functions which make handling their own finances, even at a young age, extremely simple; ultimately, we know from our own study that only one in four young people knows their way around finances. The comdirect trading app basically makes trading accessible to a broad market push information allows for rapid interaction with market events via smartphone without having to continuously follow them actively. Whether multi-banking, MoBox or next-generation trading, it is these kinds of intelligent and, for our customers, amazingly simple solutions that will make comdirect stand out as a smart financial assistant in the future. We are supporting this aim through innovation formats such as the successful Collabothon in Berlin and lively exchange with FinTechs, among other things. We still aspire to actively shape the future of the banking industry. Best wishes and stay curious! Arno Walter

4 2 Foundations of the comdirect group The comdirect group s strategic development into a smart financial assistant for modern and independent customers also progressed well in the third quarter of With intelligent solutions for investing, saving and trading in securities, comdirect meets the need for convenience and transparency in all issues relating to contemporary investing. These include on one hand the multibanking service that has been available since September. Customers thereby have an overall view of their bank accounts, credit cards and custody accounts across all of their banks via the Personal Area on the comdirect website. On the other hand it includes the comdirect trading app, which was launched in July and allows for rapid, simple and user-friendly securities trading via smartphone. The fact that customers expect these kind of innovative ideas from their smart financial assistant is demonstrated not least by the consistently high download numbers of the smartpay app. For the development of other innovations, comdirect is driving forward exchange within the group as well as with other banks and FinTechs. For example, comdirect, together with Commerzbank and mbank, hosted a hackathon ( in Berlin with numerous participants. Both best placed ideas Pure Pay, a fingerprint sensor for clearing transactions at the point of sale, and Crowd Trading, a blockchain-based peer-to-peer trading platform will now be explored further. In addition, comdirect organised an innovation boot camp, in which numerous employees from the Commerzbank Group took part. Staff members took advantage of the opportunity for discussion with founders and technology experts, among others, at Level39 in London, Europe s largest accelerator for financial technology companies. The strategic targets and measures are described in more detail in the 2015 group management report. The explanations it includes on group structure, business model and management continue to apply. Management and control Dietmar von Blücher has been the Chief Financial Officer of comdirect bank AG since July He is responsible for the areas of Finance, Controlling & Investor Relations, Risk Management & Compliance, and Information Technology. Holger Hohrein resigned his mandate as of 30 June Business Development & Innovation Management is now led by CEO Arno Walter. Market and economic review Macroeconomic framework conditions The global economy has seen only restrained growth over the course of the year so far. The moderate momentum in the US and a slight weakening in the eurozone contributed to this. The stable growth in China is overlaid with concerns about the growing debt of its companies. Brexit has so far not had a significant braking effect within the eurozone. The eurozone s core inflation rate is fluctuating at almost 1%, and no significant inflationary effects are apparent. A further easing of monetary policy has therefore become more likely.

5 Interim management report 3 Framework conditions for brokerage During the third quarter of 2016, the European equity markets almost completely made up for the losses of the previous months. The continued fall in long-term bond yields on the bond markets is giving equities an additional boost. The DAX closed on 30 September at 10, points, 2.2 % below the level at the end of Number of orders Deutsche Börse* shares traded (in billion) The DAX volatility index (VDAX-NEW), which illustrates the expected intensity of fluctuations in the DAX, has significantly declined again from its high level following the Brexit vote. 9M 15 9M 16 Shares Trading activity on the German stock exchanges declined accordingly. The trading volume in value terms Source: Deutsche Börse AG on the German spot market (XETRA, Frankfurt and * Xetra, Frankfurt Stock Exchange and Tradegate Tradegate), decreased by 18.3% year-on-year. Shares recorded falling order figures and an 18.5% lower order volume. The volume of ETFs decreased by 16.5%, while trades increased slightly. In derivatives trading (Euwax and Frankfurt stock market), stock exchange turnover was down a significant 26.0% on the figure for M 15 9M 16 ETFs Public funds recognised in the BVI investment statistics amounted to a net average income of only 7.5bn in the period from January to August 2016, compared with 56.0bn in the previous year. Property funds and mixed funds made gains, while equity funds recorded net outflows. In September 2016, the ebase fund barometer stood at 75.0 points, thus significantly below the average value for Framework conditions for banking The European Central Bank s (ECB) monetary policy remained unchanged in the third quarter of The main refinancing rate has been at 0.00% since March 2016, and the interest rate for deposits at the ECB is at 0.4%. The yields on government bonds of the European core markets showed only an insignificant rise over the course of the quarter. A majority of the government bonds continued to fluctuate in the negative, thereby disqualifying them from the ECB s bond purchase programme. In its September meeting, the Federal Reserve left the base rate the Fed rate unchanged in its range of between 0.25% and 0.50%, hinting however at an increase at the end of the year. Averaged out over the first nine months of the year, the three-month EURIBOR, which is the decisive rate for some of our investments, was clearly below the previous year s figure ( 0.04%) at 0.25% and was quoted on 30 September at 0.30%. Overall the conditions for the interest-driven business have again worsened. Industry and regulatory framework conditions The German Payment Accounts Act for the implementation of the EU-wide Payment Accounts Directive has been in force since 18 September It makes switching accounts easier, partly because standing orders can now be transferred to the new bank. Banks are also obliged to offer a basic account to people who have not previously had a bank account. comdirect has implemented the Payment Accounts Act within the time limit.

6 4 In September, the European Parliament rejected the technical regulation standards for the PRIIP Directive relating to the uniform, Europe-wide introduction of basic information leaflets for Packaged Retail and Insurance-based Investment Products. The introduction planned for the beginning of 2017 is therefore now uncertain. The international negotiations at the Basel Committee on Banking Supervision (BCBS) should be concluded by the end of Basel IV may again entail higher equity requirements for banks. Other than this, there have been no major changes in the industry-related and regulatory framework conditions as laid out in the group management report. Business performance and earnings situation at the comdirect group Overall assessment of the economic situation The comdirect group closed the third quarter with a reasonable result and is on course to achieve its target of a return on equity (RoE) of more than 19%, i.e. a pre-tax profit of more than 110m, for 2016 as a whole. However, the low-volatility equity markets and the burdensome interest rate environment led to a tangible decline in net interest income and net commission income compared with the exceptionally strong figures for the previous year s quarter. The decline could only be partly compen sated for by active management of other administrative expenses. In addition, the greater burden resulting from regulatory costs, in particular from deposit insurance, must be taken into account. For the nine-month period, the comparable value for 2015 was significantly exceeded both in the result and in earnings. This was predominantly due to the non-recurring income of around 41m accounted for in the second quarter and resulting from the purchase of VISA Europe by VISA Inc. USA and the subsequent integration under company law. Even without this effect, the nine-month result fluctuates at a solid level, even if it fell short of the previous year s high value by 15.4% due to market effects. After nine months, the development of non-financial value drivers also corresponds to the expectations made in the 2015 outlook report. Business performance As of 30 September 2016, the comdirect group had a total of 3,047.6 thousand customers. In the B2C business line, the number of customers increased by 23.3 thousand to 2,057.1 thousand in the third quarter of 2016, and was thereby 55.8 thousand, or 2.8%, up on the number at the end of 2015 (2,001.3 thousand). At thousand, the number of custody accounts in the B2C business line at the end of September 2016 was 44.4 thousand more than the number at the end of 2015 (943.7 thousand). The rise in portfolio volume was due, in particular, to persistent net fund inflows, which exceeded the previous year s values in the first nine months of the year. The order figures declined as expected over the summer months and, due to the tangible market uncertainty, were also down on the remarkably strong quarterly value for 2015, which in turn was, among other factors, characterised by exceptional effects. The previous year s value was not quite achieved for the ninemonth period. As was already the case in the second quarter, the volume of deposits increased further, due partly to the continuing improvements in performance, and partly to the worsening of conditions in the competitive environment.

7 Interim management report 5 Number of customers of comdirect group (in thousand) Total assets under custody of comdirect group (in billion) 2,001 2, B2C customers B2B customers Portfolio volume Deposit volume The number of customers in the B2B business line increased again slightly in the third quarter, and as of 30 September 2016 stood at thousand, close to the figure at the end of 2015 (988.2 thousand). The moderate decline in custody accounts for capital-building payments, custody accounts without any holdings and the custody account holdings from migrations was entirely compensated for by new business. Total assets under custody increased in the last nine months due to liquid fund inflows and reached a level at the end of the quarter that was higher than at the end of In total, assets under custody stood at 69.91bn (end 2015: 65.50bn), having grown by 9.2bn in the past twelve months. The portfolio volume stood at 52.68bn (end 2015: 49.46bn), while the deposit volume totalled 17.23bn (end 2015: 16.04bn). Earnings situation Based on the pre-tax profit for the first nine months and the average equity in the reporting period (excluding the revaluation reserves), the comdirect group achieved an annualised return on equity of 25.6% before taxes (previous year: 19.3%). At 106.9m, pre-tax profit after the first nine months firmly focussed the target for the year as a whole of more than 110m, and exceeded the previous year s value ( 77.9m) by a significant margin. In particular, the non-recurring income of around 41m resulting from the VISA transaction explained in detail in the 2016 half-year report and which comdirect bank AG received in the second quarter, made an impact here. Without this effect, the annualised return on equity before taxes was 15.8%, while the pre-tax profit declined year-on-year by 15.5% to 65.8m. The tangible decline in earnings in the third quarter from 26.5m in the previous year to a current 19.0m reflects the increasingly difficult market environment for the deposit business and brokerage, during a trading summer which was calm by comparison with the previous year. Earnings totalled 297.5m. Without accounting for the VISA effect, the 2015 nine-month value ( 285.2m) was missed by 10.1%. Both net interest income and net commission income decreased recognisably. The comdirect group made up for some of the fall in earnings with flexible management of expenses and by making specific investments. Over the three reporting quarters, administrative expenses were reduced in total by around 14m. Taking into account the non-recurring income from the VISA transaction, the cost/income ratio improved from 71.9% to 64.2%. Without taking into account the non-recurring income, the cost/income ratio increased moderately to 74.5%.

8 6 Pre-tax profit of comdirect group (in million) RoE before taxes of comdirect group (annualised in %) M 15 9M 16 9M 15 9M 16 Consolidated net profit amounted to 79.9m (previous year: 56.7m). This corresponds to earnings per share of 0.57 (previous year: 0.40). The return on equity after taxes amounted to 19.1 % (previous year: 14.0 %). Net interest income and provisions for possible loan losses The negative trend in net interest income before provisions for possible loan losses continued. In the third quarter of 2016, it stood at 29.2m due to falling interest income from low bond yields and negative money market interest rates (previous year: 34.7m). Compared with the previous year s figure of 104.1m, it fell to 91.3m. At + 0.5m, provisions for possible loan losses were almost compensated for after nine months. The low value is, in particular, due to the partial reversal of portfolio loan loss provisions made in the second quarter in the course of parameter adjustments in risk models. The previous year s value of 2.3m included appropriations caused by the decision to switch VISA credit cards to monthly billing. After provisions for possible loan losses, net interest income for the comdirect group stands at 91.8m (previous year: 101.8m). Result from financial investments The result from financial investments amounting to 42.5m (previous year: 3.8m) includes the non-recurrent income from the disposal of shares in VISA Europe of 41.1m. With lower activity, the result in the third quarter of 2016 was almost compensated for. Result from hedge accounting and trading result comdirect used forward rate agreements (FRAs) in the first half-year for interest book management, which were however fully repaid as of 30 June The result from hedge accounting and the trading result therefore amounted to 0 in the third quarter. At 41 thousand (previous year: 189 thousand) the item was marginal for the entire period under review. Net commission income In the third quarter of 2016, net commission income fell to 51.5m (previous year: 58.7m) in comparatively calm trading. In a nine-month comparison, it stood at 159.9m, 14.9m below the unusually strong 2015 figure. In addition to the effect of the moderate decrease in trade figures in the B2C business line, this was also affected by the fact that the majority of executed orders were securities savings plans with rather low order fees. The share price level, which was lower than average for the reporting period, also led to a decrease in sales follow-up commission from the funds business and to a declining average order volume.

9 Interim management report 7 Net commission income and net interest income (in million) Administrative expenses (in million) M 15 9M 16 Net commission income 9M 15 9M 16 Net interest income before provisions for possible loan losses 9M 15 9M 16 9M 15 9M 16 Other administrative expenses Personnel expenses and depreciation Other operating result The other operating result of 3.9m substantially exceeded the previous year s value ( 2.3m). In the third quarter of 2016, deferred rebates on provisions for payment transactions paid in the previous year led to a higher other operating result. The nine-month figure also included income from the reversal of individual provisions and further non-recurrent income from the card business. Administrative expenses The administrative expenses were reduced in the first nine months of 2016 by 13.9m to 191.1m (previous year: 205.0m) and made up for some of the earnings performance. Despite persistently high regulatory costs, costs were also down on the previous year s value ( 66.1m) in the third quarter at 62.9m. As a consequence of increased employee numbers and salary adjustments, personnel expenses were 7.5% up on the 2015 nine-month value ( 61.0m), at 65.5m. The increase was 7.4% in the third quarter of The decrease in other administrative expenses from 132.2m to 115.3m after nine months is primarily due to active management of costs as well as less sales activities, which were about half those of the previous year. This partly compensated for effects arising from the current market and earnings situation. The previous year s figure also included expenses for the launch of the Bank. Re-envisioned. brand campaign. The expenses for IT and business activities were down slightly thanks to active cost management. On the other hand, mandatory contributions negatively affected the earnings situation to a significantly greater degree than in the previous year. The considerably higher expenses for the statutory deposit insurance scheme were particularly noticeable. Other administrative expenses fell 10.2% in the third quarter of Depreciation declined further in the third quarter. The main reason for this was the expiry of amortisation of acquired software and other intangible assets. The ending of the depreciation of acquired customer relationships as of the end of 2015 also had an impact on the nine-month comparison. In total, depreciation fell from 11.8m to 10.3m.

10 8 B2C business line Business development in brokerage Trading The innovative solutions for investing, saving and trading with securities were expanded in the third quarter of 2016 with the comdirect trading app. Customers can use the smart tool to trade securities at any time and anywhere using a smartphone. Stripped to the essentials and with a simplified display, the app is tailored for rapid and simple trading. Individual push notifications for set price alarms, market information in real time and quick access to favourites allow for immediate interaction with market events. The app was made widely available in mid-july 2016, initially for the Android operating system. Investors reticence continued to increase over the summer months, which lead to a significant decline in the comdirect Brokerage Index, which is calculated on a monthly basis. Despite the declining volatility in the first nine months, the number of executed orders reached million, almost equalling the previous year s figure (11.04 million). However, the slowdown in the market environment in the third quarter led to a decrease in trade numbers of 9.5%. Due to the higher numbers of custody accounts, the annualised order activity per custody account over the course of the year so far fell from 16.3 in the same period of the previous year to Securities turnover amounted to 35.91bn, which corresponds to a decrease of 20.9% compared with the previous year ( 45.37bn). Investing The bonus savings scheme has been available since the end of June 2016 with the aim of introducing even more customers to securities investments. Several thousand registered customers already are securing attractive bonuses, which are brought together as savings deposits and automatically invested in an index fund without order fees, at numerous partner shops and tour operators. Our range of securities savings plans continues to be well received, which resulted in a significant increase in savings-plan-related order figures in the first nine months. Executed orders B2C (in million) Portfolio volume B2C (in billion) M 15 9M

11 Interim management report 9 The portfolio volume in the B2C business line climbed by 1.52bn to 26.04bn in the third quarter of The figure at the end of 2015 ( 24.14bn) was exceeded by 7.8%, while the growth over the past 12 months amounts to 20.3%, or 4.40bn. Price effects were of virtually no consequence over the previous course of the reporting year. By contrast, comdirect achieved high net fund inflows of 2.2bn (2015: 1.7bn) due to the growing number of custody accounts and a successful custody account transfer campaign. The number of custody accounts rose by 4.7% to thousand in the first nine months (end 2015: thousand). Business development in banking Since September 2016, comdirect has been one of the first banks to offer a comprehensive multibanking service via the comdirect website. Via a desktop PC as well as mobile devices, customers can add accounts, credit cards and custody accounts of external financial institutions to their Personal Area extremely easily, giving them a complete overview of their finances at all times and across all banks. This makes comdirect a digital financial centre for all customers with more than one bank account. The very popular JuniorGiro from comdirect now has its own app, the MoBox, which features mobile and secure use via smartphone, thereby placing young users finances more firmly in their daily lives. They can conveniently check their account balance, work towards individual savings targets, easily carry out small transfers and quickly exchange account data using the QR code scanner. The launch of the youth app was accompanied by the published comdirect youth study, which met with broad media resonance. Deposit business The volume of deposits increased during the current year by 1.10bn, or 7.0%, to 16.90bn. As was the case in the first half-year, the volume in current accounts also increased in the third quarter (+ 2.2%), which was primarily associated with the 1.9% rise in the number of accounts to 1,334.1 thousand. The volume of fixed-term deposits changed only negligibly. As of 30 September 2016, 96.7% (end 2015: 95.3%) of liabilities to customers in the B2C business line were attributable to deposits due on demand. Deposit volume B2C (in billion) Credit volume of comdirect group (in million)

12 10 Lending business The volume of utilisation of credit products by private customers as of end of September 2016 came to 337m, compared with 300m at the end of 2015, and 218m as of 30 September Credit volume increased, in particular, with securities accounts. The consumer loan volume grew moderately. In building finance advice, comdirect acts as an intermediary, working with more than 250 financing partners. The offering therefore had no impact on the bank s reported credit volume. The volume of building finance placed fell in comparison with the previous year ( 539.8m) to 386m. This was partly the result of market development and partly of our focus on digital advisory services, which also meant the discontinuation of office-based building finance advice in the last year. Earnings situation in the B2C business line In the first nine months of 2016, the B2C business line generated a return on equity before taxes of 25.7% and a pre-tax profit of 100.6m (previous year: 18.1% or 68.5m). This includes the nonrecurrent income from the VISA transaction explained in detail at group level. The cost/income ratio improved to 61.3% (previous year: 71.0%). The earnings components related to the comdirect group s deposit business net interest income, the trading result, the result from financial investments and the result from hedge accounting stem mainly from the B2C business line and are thus explained at group level (see page 6). At 121.7m, net commission income was below the high value of 134.2m seen in the same period of the previous year. Administrative expenses fell primarily because of lower sales expenses to 158.6m, and were therefore below the previous year s high level ( 173.5m) which was influenced by the Bank. Re-envisioned. campaign. The other operating result of 3.2m (previous year: 1.8m) includes income from the reversal of provisions and non-recurrent income from the card business. B2B business line Business development Product development and sales In the third quarter, ebase technically further developed the standardised asset management offered via fintego. A chat function has been available since the beginning of September that customers can use to enter their questions directly in the browser. The service for personal provisioning has been offered since 26 September 2016 under the finvesto brand (previously cominvest). The introduction of foreign currency accounts for institutional customers was also successfully concluded. The ebase 4kids custody account, introduced in the last quarter and which enables asset accumulation for children and young people under 18 without custody account fees, has been taken up well in the market.

13 Interim management report 11 Customers, custody accounts and portfolio volume The number of customers increased slightly in the first nine months of 2016 thanks to new gains in the third quarter, and stood at thousand as of the quarterly reporting date (end 2015: thousand). The portfolio volume increased due to net fund inflows to 26.64bn (end 2015: 25.32bn, 9M 2015: 23.45bn). Total assets under custody B2B (in billion) Accounts and deposit volume At 323m, the deposit volume exceeded the figure as of the end of 2015 ( 236m). Most of the deposit volume was still attributable to the settlement accounts linked with the custody account (Flex account). These accounts are available for buying and selling transactions in funds business, to accept inflows from expiring insurance policies and as a fully-fledged, online-type account for payment transactions. Earnings situation in the B2B business line With a return on equity before taxes of 23.5% (previous year: 35.1%) and a pre-tax profit of 6.3m (previous year: 9.4m), the B2B business line fell short of the comparative values for The cost/ income ratio rose to 83.8% (previous year: 77.1%). Due to the market-induced fall in funds volume and correspondingly lower ongoing sales follow-up commission, net commission income decreased to 38.3m (previous year: 40.6m). Because of persistently low market interest rates, original net interest income from investments fell to thousand (previous year: 289 thousand). Due to negative interest rate effects arising from provisions for pensions net interest income totalled 183 thousand (previous year: 232 thousand). Administrative expenses also increased slightly to 32.6m (previous year: 31.6m), partly a consequence of higher maintenance and development costs, resulting from the expansion of the business model. Financial situation and assets of the comdirect group The comdirect Treasury continued to focus on counterparties with a good credit rating in the reinvestment of customer deposits in the money and capital market, being mindful of wide-ranging matched maturities regarding the economic holding period of the deposits. In this context it also ensures adequate cash holdings at all times and manages the liquidity and interest rate risk in particular. During the reporting period, the overwhelming majority of investments were again made with Commerzbank AG and selected other companies of the Commerzbank Group. As explained in detail in the 2015 annual report, the securities of these companies are directly or indirectly, by means of the respective instrument, comprehensively collateralised via a general assignment agreement and a pledged securities account. Where required, derivative financial instruments are used to hedge interest rate risks from bonds and manage the interest book in the Treasury portfolio. As of 30 September 2016, the nominal volume of these derivatives amounted to 0.

14 12 Investments In the first nine months of 2016, investments totalled 8.7m (previous year: 8.3m) and were essentially dominated by IT investments. The balance sheet additions in the B2C business line amounting to 5.0m were largely attributable to acquired hardware and software ( 3.6m) as well as to internally generated software ( 1.2m). The investment volume in the B2B business line amounting to 3.6m primarily related to internally generated software ( 3.5m). Balance sheet total The comdirect group s balance sheet total as of 30 September 2016 rose compared with the 2015 reporting date ( 16.77bn) as a result of the further increase in deposit volume to 17.98bn. Assets At 12.99bn, claims on banks, which essentially relate to promissory notes and fixed-term deposits, were up by 11.0% on the end of 2015 ( 11.70bn). At 3.32bn, the volume of financial investments was negligibly lower than at the end of 2015 ( 3.42bn). This line item mainly comprises bonds and Pfandbriefe as well as the preferred stocks now held in VISA Inc. USA. Claims on customers rose to 382.6m (end 2015: 341.8m). The main cause was the rise in the volume of loans against securities in the B2C business line. At 1,224m, the cash reserve remained virtually stable (end 2015: 1,228m). Almost all of this amount relates to the credit balance at the Deutsche Bundesbank. Financing Around 96% of the financing side of the balance sheet still comprises the deposits of private customers. Due to the growth in deposits, liabilities to customers increased to 17.22bn (end 2015: 16.04bn). Liabilities to banks, which reflect the balances of the current settlement accounts at Commerzbank, amounted to 26.5m (end 2015: 6.4m). Provisions stood at 41.6m and therefore were below the comparative figure at the end of the year 2015 ( 46.3m). Among other factors, the outsourcing of financial resources for existing pension obligations affected the B2B business line. Other liabilities amounting to 56.5m (end 2015: 43.9m) primarily comprise trade liabilities and our customers final withholding tax to be paid. Equity amounted to 621.6m (end 2015: 624.2m). The striking reduction during the year of the revaluation reserves this includes is the consequence of the VISA transaction now recognised in profit and loss.

15 Interim management report 13 Cash flow statement of the comdirect group The business model of the comdirect group means that the cash flow from operating activities is primarily influenced by trends in customer deposits and their reinvestment. In the reporting period, it stood at 60.6m (previous year: 947.1m). In the previous year, an increase in the cash reserve as part of operational liquidity management led to greater inflows. Cash flow from investment activities amounted to 8.7m (previous year: 8.3m). The dividend distribution in the second quarter led to a cash flow from financing activities of 56.5m (previous year: 56.5m). Non-financial performance indicators Relationships with customers The new comdirect community successfully started in mid-august. The new platform, which replaces the previous forum on the comdirect website, allows users to discuss financial topics and to get helpful answers to frequently asked questions. comdirect measures the quality of its customer relationships by means of regular customer surveys in Customer Services and independent customer satisfaction analyses. As a central indicator of customer satisfaction and loyalty in the B2C business line, the net promoter score (NPS) is ascertained annually and published in the annual report. In addition to customer satisfaction, brand awareness and likeability are key competitive factors. The results from the performance comparisons also point to the positioning of the comdirect brand in the competitive environment. Following its victory in the previous year with VideoIdent, comdirect has secured itself the 2016 Customer Innovation Prize awarded by the Deutsches Institut für Service- Qualität (German Institute for Service Quality) and DUB UNTERNEHMER magazine with its bonus savings scheme. Along with other banks, comdirect received an evaluation of very good from ServiceValue s 2016 competition analysis of the most customer-oriented banks. comdirect s securities savings plans for investment funds, ETFs, certificates and shares also fared extremely well in a comparative test from FOCUS MONEY. With its excellent information and service products, comdirect s AnlageAssistent for investments left all other competitors products behind in a comparison test of investment portals without risk enquiry carried out by uro am Sonntag magazine. comdirect s trading app also received the Red Dot Award, the internationally renowned prize for communication design. comdirect also came first in the prepaid credit cards category in a comparative test of credit cards carried out by Deutsche Finanz-Service Institut on behalf of FOCUS MONEY magazine. uro am Sonntag selected comdirect s current account as the best direct bank offer for students. In addition, comdirect not only received the silver award for the smartpay app in the Payments & Wallets category at the international Efma Accenture Awards in Barcelona in October, but also received for the sixth year in a row the ETF Direct Bank of the Year consumer prize. The award is part of the EXtra ETP Awards, which are presented annually by the Stuttgart stock exchange and EXtra-Magazin.

16 14 Personnel The number of employees increased slightly to 1,318 in the first nine months of 2016 (end 2015: 1,314). The number of employees in the B2C business line remained almost unchanged at 1,056 (end 2015: 1,058 employees), while in the B2B business line it climbed slightly to 262 (end 2015: 256 employees). Compared with the number as of 30 September 2015, the number of employees increased moderately by 17. The comdirect group s personnel management supports the strategic development of the bank with targeted measures in personnel marketing and selection, competence and talent management, and manager and team development. comdirect is also active in training: it welcomed 11 new trainees to Quickborn in August. Number of employees of comdirect group 1,058 1, B2C business line B2B business line Capital market relations The comdirect share moved sidewards in the third quarter As of 30 September, it closed at 9.10 after 9.16 at the middle of the year. The share fell by 16.5% compared with the end of December The DAXsector Financial Services Performance Index showed a slight positive performance over the summer months and increased by 9.9% compared with the end of Data and key figures of the share Q Data German securities code number ISIN Code DE Stock exchange code COM Reuters: CDBG.DE Bloomberg: COM GR Stock exchange segment Regulated market (Prime Standard) Number of shares issued 141,220,815 no-par-value shares Designated sponsor Commerzbank AG Shareholder structure 81.34% Commerzbank AG 1) 18.66% Free float Key figures Q Average daily turnover in units XETRA Frankfurt Tradegate Other stock exchanges Over the counter (OTC trading) Opening quotation XETRA ( ) Highest price XETRA ( ) 2) Lowest price XETRA ( ) 2) 8.75 Closing quotation XETRA ( ) 9.10 Market capitalisation ( ) 1,285.1m 22,441 1,499 5,035 1,160 10,628 40,763 Earnings per share 0.57 Total shareholder return 3) 17.1% Dividend yield 4) 3.7% 1) Indirectly 2) Daily closing quotation 3) Annualised 4) Based on the dividend paid for financial year 2015 and closing quotation at year-end

17 Interim management report 15 At 40.8 thousand on average, the number of units traded per day was below the corresponding figure for 2015 (75.7 thousand). Due to the comparatively low trading volume, which reflects the comdirect group s stable and non-fluctuating business model, comdirect has no longer been listed on the SDAX since September. Market capitalisation was at 1,285.1m as of 30 September Commerzbank increased its stake in comdirect in the third quarter of 2016 from 81.30% to 81.34%. The free float therefore stands at %. comdirect share price performance to (in ) January February March April May June July August September DAXsector Financial Services Performance Index comdirect share Source: Bloomberg; indices normalised to the comdirect share price as of year-end 2015 Supplementary report No major events or developments of special significance have occurred since the reporting date of 30 September 2016.

18 16 Outlook, risk and opportunity report The economic framework conditions have predominantly developed in line with the assumptions indicated in the outlook report of the 2015 group management report (see pages 37 to 38 of the financial report). However, trading activity in the second and third quarters of 2016 declined more strongly than expected. Net commission income will therefore be lower than the unusually strong comparative value for In addition, continued low market interest rates are anticipated. We are therefore standing by the forecasts made in the 2015 outlook report regarding net interest income and continue to expect an appreciable decline. The market-related decline in earnings can be partially compensated for by the active management of expenses. However, a rise in sales expenses can be expected for the fourth quarter of 2016 due to the planned intensification of sales activities. Including the non-recurrent earnings from the VISA transaction, the comdirect group s return on equity before taxes is expected to expire at more than 19% and exceed the comparable value for 2015 (16.7%). Accordingly, the pre-tax profit should be more than 110m. The direction for the B2C business line continues to be set by the strategy approved at the start of the year. As a smart financial assistant, our product initiatives aim to offer innovative solutions for investing, saving and trading with securities in order to attain the leading market position in securities-based digital asset management. The focus of sales will be on the comdirect trading app and the MoBox app. We will also be focusing on the further development towards becoming a digital financial centre via the multi-banking service. In the B2B business line, ebase is pressing ahead with digitalising its value chain. This is intended to solidify its position as a leading B2B service provider in asset management. This goal is also served by the strategic partnership we have had with the FinTech Fincite since October, which focuses on the development of tailored digital insurance solutions. The position of the comdirect group in terms of risks and opportunities is essentially unchanged compared with the presentation in the 2015 annual report. Due to a faulty software update on 18 July, customers were able to see the accounts of other users for a brief period. No funds could be transferred to other people s accounts, nor could securities be traded, however. Equally, login details were not visible and could not be changed. The fault was rectified within just a few hours. Intensive error analyses were also promptly initiated. Based on the results of these investigations, additional measures were introduced to further increase data security. There have been no apparent negative financial effects. The risk report can be found on pages 39 to 49 of the financial report, while note (51) regarding the risk reporting of financial instruments is on pages 105 to 109. The opportunity report can be found on pages 50 to 51. The comdirect group has enough of a risk buffer to safely withstand even lengthy weak market phases. From today s perspective, there are no realistic risks in evidence that could threaten the continued existence of the comdirect group.

19 Interim financial statements 17 Income statement Income statement of comdirect group according to IFRS thousand 1.1. to to Interest income 104, ,636 33,266 41,307 Interest expenses 13,185 21,530 4,056 6,588 Net interest income before provisions for possible loan losses 91, ,106 29,210 34,719 Provisions for possible loan losses 477 2, ,850 Net interest income after provisions for possible loan losses 91, ,819 28,784 32,869 Commission income 269, ,683 89,468 96,554 Commission expenses 109, ,909 38,009 37,895 Net commission income 159, ,774 51,459 58,659 Trading result and result from hedge accounting Result from financial investments 42,475 3, Administrative expenses 191, ,009 62,907 66,086 Other operating result 3,890 2,346 1,688 1,016 Pre-tax profit 106,907 77,876 19,029 26,546 Taxes on income 27,003 21,156 5,432 7,411 Net profit 79,904 56,720 13,597 19,135 Undiluted/diluted earnings per share 1.1. to to Net profit (in thousand) 79,904 56,720 13,597 19,135 Average number of ordinary shares (number) 141,220, ,220, ,220, ,220,815 Undiluted/diluted earnings per share (in ) Statement of comprehensive income Statement of comprehensive income of comdirect group according to IFRS thousand 1.1. to to Net profit 79,904 56,720 13,597 19,135 Items which cannot be reclassified to the income statement Changes in actuarial gains/losses recognised in equity 4,975 3,419 1, Items which can be reclassified to the income statement Changes in the revaluation reserves after tax Change in value recognised in equity 15,442 11,366 3,659 7,188 Reclassification to the income statement 36,514 3, Other comprehensive income for the period 26,047 11,565 2,644 6,908 Comprehensive income 53,857 45,155 16,241 12,227 Net profit and comprehensive income for the reporting period are attributable in full to the shareholders of comdirect bank AG.

20 18 Balance sheet Balance sheet of comdirect group according to IFRS thousand Assets as of as of Cash reserve 1,223,663 1,228,206 Claims on banks 12,986,425 11,699,450 Claims on customers 382, ,798 Financial investments 3,323,228 3,416,228 Intangible assets 22,840 23,051 Fixed assets 13,437 14,903 Non-current assets held for sale 0 32,498 Current income tax assets 2,629 1,278 Deferred income tax assets 462 1,785 Other assets 23,182 9,532 Total assets 17,978,470 16,768,729 Liabilities and equity as of as of Liabilities to banks 26,460 6,382 Liabilities to customers 17,223,242 16,044,884 Provisions 41,558 46,299 Current income tax liabilities 9,107 3,075 Other liabilities 56,504 43,859 Equity 621, ,230 Subscribed capital 141, ,221 Capital reserve 223, ,296 Retained earnings 122, ,438 Revaluation reserves 54,715 75,787 Consolidated profit ,488 Net profit from 1.1. to ,904 Total liabilities and equity 17,978,470 16,768,729

21 Interim financial statements 19 Statement of changes in equity thousand Subscribed capital Capital reserve Retained earnings Revaluation reserves 1) Group result Equity as of , , ,934 53,302 56, ,241 Net profit from 1.1. to ,042 65,042 Change in actuarial gains/losses recognised in equity 2,951 2,951 Change in the revaluation reserves 22,485 22,485 Comprehensive income ,951 22,485 65,042 90,478 Profit distributions 56,488 56,488 Allocation to reserves/transfer from reserves 8,554 8,554 0 Total Equity as of / , , ,438 75,787 56, ,230 Net profit from 1.1. to ,904 79,904 Change in actuarial gains/losses recognised in equity 4,975 4,975 Change in the revaluation reserves 21,072 21,072 Comprehensive income from 1.1. to ,975 21,072 79,904 53,857 Profit distributions 56,488 56,488 Equity as of , , ,463 54,715 79, ,599 1) pursuant to IAS 39 thousand Subscribed capital Capital reserve Retained earnings Revaluation reserves 1) Equity as of , , ,934 53,302 56, ,241 Net profit from 1.1. to ,720 56,720 Change in actuarial gains/losses recognised in equity 3,419 3,419 Change in the revaluation reserves 14,984 14,984 Comprehensive income from 1.1. to ,419 14,984 56,720 45,155 Profit distributions 56,488 56,488 Equity as of , , ,353 38,318 56, ,908 1) pursuant to IAS 39 Group result Total In the 2016 financial year, dividends of 56,488 thousand (2015: 56,488 thousand) were distributed to the shareholders of comdirect bank AG. This represents an amount per share of 0.40 (previous year: 0.40). In financial year 2016, comdirect did not make use of either the existing authorisations of the annual general meeting to purchase own shares for the purpose of securities trading pursuant to Section 71 (1) No. 7 German Stock Corporation Act (AktG) or of the resolutions of the annual general meeting authorising the purchase of own shares pursuant to Section 71 (1) No. 8 German Stock Corporation Act (AktG) for purposes other than securities trading.

22 20 Cash flow statement thousand Cash and cash equivalents as of ,228,206 6,023 Cash flow from operating activities 60, ,121 Cash flow from investment activities 8,662 8,278 Cash flow from financing activities 56,488 56,488 Cash and cash equivalents as of ,223, ,378 Cash and cash equivalents correspond to the balance sheet item cash reserve and include cash on hand and balances held at central banks. The cash flow from operating activities is essentially determined by the taking in of customer deposits and their reinvestment in the money and capital markets. The cash flow from investment activities results from the acquisition and disposal of tangible and intangible assets. The cash flow from financing activities stems from the dividend distribution by comdirect bank AG to its shareholders. The cash flow statement is of minor importance for the comdirect group. It does not replace liquidity and financial planning, nor is it used as a management tool. It provides no information about the actual liquidity situation, which in principle is dependent on the operating business and not on cash on hand or the credit balance with the central bank. Notes Administrative expenses thousand 1.1. to to Personnel expenses 65,529 60,963 22,675 21,113 Other administrative expenses 115, ,217 36,919 41,103 Sales 19,320 38,496 6,929 11,958 External services 33,236 33,240 10,609 10,986 Business operations 26,549 28,712 8,460 9,352 IT expenses 23,191 24,406 7,109 7,736 Mandatory contributions 11,352 5,752 3,428 1,734 Others 1,604 1, Depreciation of office furniture and equipment and intangible assets 10,320 11,829 3,313 3,870 Total 191, ,009 62,907 66,086

23 Interim financial statements 21 Segment reporting by business line thousand 1.1. to B2C B2B Consolidation comdirect group total Interest income 104, ,489 Interest expenses 12, ,185 Net interest income before provisions for possible loan losses 91, ,304 Provisions for possible loan losses Net interest income after provisions for possible loan losses 91, ,781 Commission income 133, , ,039 Commission expenses 11,841 97, ,136 Net commission income 121,691 38, ,903 Trading result and result from hedge accounting Result from financial investments 42, ,475 Administrative expenses 158,642 32, ,101 Other operating result 3, ,890 Pre-tax profit 100,617 6, ,907 Segment investments 5,050 3,620 8,670 Segment depreciation 6,722 3,598 10,320 Cost/income ratio 61.3% 83.8% 64.2% Segment income 287, ,984 of which external income 287, ,883 of which inter-segmental income Segment expenses 186, ,694 The management focuses on two business lines: Business to Customer (B2C) and Business to Business (B2B). The segmentation carried out reflects the internal reporting of the comdirect bank group and corresponds to the management approach. The respective customer groups in particular constitute the main delimitation feature of the business segments. The B2C business segment comprises the activities of comdirect bank AG with its five special assets. These relate to services in brokerage, banking and advice in direct business with modern investors. The activities in the B2B business segment are carried out via ebase GmbH. Through its B2B partners, ebase offers comprehensive and tailored solutions for asset accumulation and investments.

24 22 Segment reporting by business line thousand 1.7. to B2C B2B Consolidation comdirect group total Interest income 33, ,266 Interest expenses 3, ,056 Net interest income before provisions for possible loan losses 29, ,210 Provisions for possible loan losses Net interest income after provisions for possible loan losses 28, ,784 Commission income 42,371 47, ,468 Commission expenses 3,878 34, ,009 Net commission income 38,493 12, ,459 Trading result and result from hedge accounting Result from financial investments Administrative expenses 52,024 11, ,907 Other operating result 1, ,688 Pre-tax profit 16,829 2,200 19,029 Segment investments 1, ,843 Segment depreciation 2,126 1,187 3,313 Cost/income ratio 75.1% 83.3% 76.4% Segment income 77,340 48,061 of which external income 77,234 48,025 of which inter-segmental income Segment expenses 60,511 45,861 The figures for the B2B business segment were derived from the internal reporting of ebase GmbH and correspond to the contributions of ebase GmbH included in the income statement of the comdirect group. As part of Treasury investments, the B2B business segment makes money market transactions with the B2C business segment. An interest income of 13 thousand (previous year: 91 thousand) was therefore achieved in the B2B business segment. The corresponding level of interest expenses was recorded in the B2C business segment. In both segments, segment assets and segment liabilities are not relevant management indicators within the meaning of IFRS 8 and are therefore not shown in the table.

25 Interim financial statements 23 Segment reporting by business line thousand 1.1. to B2C B2B Consolidation comdirect group total Interest income 125, ,636 Interest expenses 21, ,530 Net interest income before provisions for possible loan losses 104, ,106 Provisions for possible loan losses 2, ,287 Net interest income after provisions for possible loan losses 102, ,819 Commission income 147, , ,683 Commission expenses 13, , ,909 Net commission income 134,236 40, ,774 Trading result and result from hedge accounting Result from financial investments 3, ,757 Administrative expenses 173,480 31, ,009 Other operating result 1, ,346 Pre-tax profit 68,487 9,389 77,876 Segment investments 5,219 3,060 8,279 Segment depreciation 8,426 3,403 11,829 Cost/income ratio 71.0% 77.1% 71.9% Segment income 281, ,244 of which external income 281, ,051 of which inter-segmental income Segment expenses 213, ,855

26 24 Segment reporting by business line thousand 1.7. to B2C B2B Consolidation comdirect group total Interest income 41, ,307 Interest expenses 6, ,588 Net interest income before provisions for possible loan losses 34, ,719 Provisions for possible loan losses 1, ,850 Net interest income after provisions for possible loan losses 32, ,869 Commission income 48,670 47, ,554 Commission expenses 3,325 34, ,895 Net commission income 45,345 13, ,659 Trading result and result from hedge accounting Result from financial investments Administrative expenses 55,211 10, ,086 Other operating result ,016 Pre-tax profit 23,960 2,586 26,546 Segment investments 1,701 1,299 3,000 Segment depreciation 2,741 1,129 3,870 Cost/income ratio 68.1% 80.8% 69.9% Segment income 91,919 48,294 of which external income 91,912 48,237 of which inter-segmental income 7 57 Segment expenses 67,959 45,708

27 Interim financial statements 25 Income statement of comdirect group according to IFRS on a quarterly comparison thousand Q1 Q2 Q3 Q4 Q1 Q2 Q3 Interest income 42,947 41,382 41,307 39,664 37,118 34,105 33,266 Interest expenses 7,742 7,200 6,588 6,366 5,002 4,127 4,056 Net interest income before provisions for possible loan losses 35,205 34,182 34,719 33,298 32,116 29,978 29,210 Provisions for possible loan losses , Net interest income after provisions for possible loan losses 35,179 33,771 32,869 32,690 32,024 30,973 28,784 Commission income 99,239 96,890 96,554 90,712 89,569 90,002 89,468 Commission expenses 38,720 41,294 37,895 37,121 34,693 36,434 38,009 Net commission income 60,519 55,596 58,659 53,591 54,876 53,568 51,459 Trading result and result from hedge accounting Result from financial investments 1,601 2, ,875 5 Administrative expenses 73,408 65,515 66,086 74,971 64,977 63,217 62,907 Personnel expenses 19,772 20,078 21,113 22,190 21,121 21,733 22,675 Other administrative expenses 49,556 41,558 41,103 48,093 40,248 38,085 36,919 Sales 15,210 11,328 11,958 15,086 6,055 6,336 6,929 External services 11,126 11,128 10,986 11,293 11,316 11,311 10,609 Business operations 9,508 9,852 9,352 10,471 9,314 8,775 8,460 IT expenses 9,152 7,518 7,736 7,647 8,798 7,284 7,109 Mandatory contributions 2,346 1,672 1,734 3,044 4,341 3,583 3,428 Others 2, Depreciation of office furniture and equipment and intangible assets 4,080 3,879 3,870 4,688 3,608 3,399 3,313 Other operating result , , ,688 Pre-tax profit 24,660 26,670 26,546 12,732 23,727 64,151 19,029 Taxes on income 6,644 7,101 7,411 4,410 6,457 15,114 5,432 Net profit 18,016 19,569 19,135 8,322 17,270 49,037 13,597 Statement of comprehensive income of comdirect group according to IAS/IFRS on a quarterly comparison thousand Q1 Q2 Q3 Q4 Q1 Q2 Q3 Net profit 18,016 19,569 19,135 8,322 17,270 49,037 13,597 Items which cannot be reclassified to the income statement Change in actuarial gains/losses recognised in equity 2,760 5, ,517 1,349 1,109 Items which can be reclassified to the income statement Change in the revaluation reserves after tax Change in value recognised in equity 11,079 15,257 7,188 37,865 9,622 2,161 3,659 Reclassification to the income statement 1,386 1, , Other comprehensive income for the period 6,933 11,590 6,908 37,001 6,535 35,226 2,644 Comprehensive income 24,949 7,979 12,227 45,323 23,805 13,811 16,241

28 26 Fair value of financial instruments The table below shows the fair values of financial instruments compared with their book values. The fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm s length transaction. Where stock market prices were available, these were used for the measurement of financial instruments. In the event that no market price was available, measurements were carried out using internal measurement models with current market price parameters. In this connection, the net present value method was used in particular. thousand Fair value Book value Loans and receivables Cash reserve 1,223,663 1,228,206 1,223,663 1,228,206 Claims on banks 13,163,146 11,835,565 12,986,425 11,699,450 Claims on customers 382, , , ,798 Total 14,769,626 13,405,569 14,592,692 13,269,454 Available for sale financial assets Financial investments 3,323,228 3,416,228 3,323,228 3,416,228 Non-current assets as held for sale 0 32, ,498 Total 3,323,228 3,448,726 3,323,228 3,448,726 Liabilities measured at amortised cost Liabilities to banks 26,460 6,382 26,460 6,382 Liabilities to customers 17,260,264 16,080,496 17,223,242 16,044,884 Total 17,286,724 16,086,878 17,249,702 16,051,266 The fair value of the financial instruments due on demand is their nominal value. These instruments include the cash reserve, overdraft facilities and demand deposits under the balance sheet item claims on banks in the amount of 362,847 thousand (2015: 311,119 thousand), claims on customers in the amount of 371,491 thousand (2015: 341,798 thousand), liabilities to banks in the amount of 26,460 thousand (2015: 6,382 thousand) and liabilities to customers in the amount of 16,665,352 thousand (2015: 15,309,341 thousand). Allocation of fair values is presented in the note fair value hierarchy.

29 Interim financial statements 27 Fair value hierarchy The table below shows how the individual financial instruments are allocated to the appropriate level of the fair value hierarchy and to the corresponding measurement category in accordance with IAS 39. Level 1: Prices quoted in active markets (not adjusted) for identical assets or liabilities. Level 2: Exemplary prices calculated with the exception of the quoted prices included in Level 1, which can be observed for assets or liabilities either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Exemplary prices calculated for assets or liabilities, which are not based on observable market data (non-observable input data). thousand Total Level 1 Level 2 Level 3 Assets Loans and receivables Cash reserve 1,223, ,223,663 0 Claims on banks 13,163, ,163,146 0 Claims on customers 382, ,576 11,241 Available for sale Financial investments 3,323,228 2,374, ,289 9,756 Non-current assets as held for sale Total assets 18,092,854 2,374,183 15,697,674 20,997 Liabilities Liabilities measured at amortised cost Liabilities to banks 26, ,460 0 Liabilities to customers 17,260, ,260,264 0 Total liabilities 17,286, ,286,724 0

30 28 thousand Total Level 1 Level 2 Level 3 Assets Loans and receivables Cash reserve 1,228, ,228,206 0 Claims on banks 11,835, ,835,565 0 Claims on customers 341, ,798 0 Available for sale Financial investments 3,416,228 2,435, ,357 0 Non-current assets as held for sale 32, ,498 Total assets 16,854,295 2,435,871 14,385,926 32,498 Liabilities Liabilities measured at amortised cost Liabilities to banks 6, ,382 0 Liabilities to customers 16,080, ,080,496 0 Fair value through profit or loss Negative fair values from derivative hedging instruments Total liabilities 16,086, ,086,878 0 In the reporting period, securities with a fair value of 1m were reclassified from level 1 to level 2, as no quoted market prices were available. On the other hand, securities with a fair value of 77m were reclassified from level 2 to level 1, as an active market was available due to increased market activity. In the previous year, shares held by comdirect bank AG in VISA Europe Ltd. were recognised as assets held for sale under level 3 of the valuation hierarchy. As part of their sale, preferred stocks in VISA Inc. USA will also be allocated under level 3 of the valuation hierarchy. They are reported under the financial investments item. All consumer loans will be allocated under level 3 of the valuation hierarchy. This resulted in the value for level 3 recognised in the claims on customers item.

31 Interim financial statements 29 Accounting standards and other information Accounting standards The comdirect group s quarterly report as of 30 September 2016 was prepared pursuant to Section 51a (6) of the Frankfurt stock market rules and regulations in accordance with the provisions of Section 37w (2) No. 1 and 2, (3) and (4) of the German Securities Trading Act (WpHG). It is also in accordance with International Accounting Standard 34 (IAS 34) approved and published by the International Accounting Standards Board (IASB). The same accounting and measurement methods were applied as for the consolidated financial statements of the comdirect group as of 31 December The rules to be applied for the first time in the reporting period had no impact on the consolidated financial statements. Consolidated companies There were no changes in the comdirect group s scope of consolidation during the reporting period. Notes to the financial statements The interim management report contains details of the earnings situation and asset position of the comdirect group as well as information regarding the macroeconomic environment. The presentation of the composition of other administrative expenses in this interim financial report deviates from that of the 2015 financial report. The new structure is more meaningful and is oriented to the comdirect group s internal reporting. The previous year s figures regarding other administrative expenses were adjusted for comparability; this is not however a retrospective correction as defined by IAS 8. The total amounts of other administrative expenses reported in previous periods all remain unchanged. The details in the 2015 financial report on the retrospective adjustment to the presentation of contributions to the German banks compensation fund continue to apply. Individual comparative figures for previous periods therefore do not correspond to the values reported in the previous year as of 30 September Net interest income Interest expenses have been incurred for customer deposits, negative interest from assets-side financial instruments as well as net interest expenses for pensions and similar obligations. The negative interest came to 2,857 thousand (2015: 665 thousand). Result from financial investments The result from financial investments for the reporting period of 42,475 thousand (previous year: 3,757 thousand) is, to a significant degree, due to the disposal of the shares in VISA Europe Ltd., which was concluded in the first half-year and which generated a profit contribution of 41,058 thousand.

32 30 As of 31 December 2015, a fair value of 32,498 thousand was determined for the shares in VISA Europe Ltd. As of the time of transaction, this amounted to 41,058 thousand. The associated increase in revaluation reserves is reported in other comprehensive income for the period as is the reclassification to the result from financial investments on disposals (recycling). Overall, the effects named generated other comprehensive income for the period of 32,117 thousand in the reporting period. The preferred stocks acquired as part of the transaction had a fair value of 9,756 thousand as of 30 September The increase compared with the acquisition value of 8,968 thousand leads to a contribution to other comprehensive income for the period of 788 thousand. Result from hedge accounting and trading result In the reporting period, individual forward rate agreements were used for interest book management. Interest rate swaps to hedge interest rate-related changes in the market value of several bonds with the same volume and same maturity were held to a limited degree. There were no derivatives in the portfolio as of the reporting date (nominal volume end of 2015: 0.1m). Where derivatives meet the requirements of IAS 39, hedge accounting is applied (micro fair value hedges). As of the reporting date, the above produced a result from hedge accounting of 0 thousand (previous year: 1 thousand) and a trading result of 41 thousand (previous year: 188 thousand). Tax amounts included in other comprehensive income for the period Other comprehensive income for the period Before tax Tax After tax thousand 1 January to 30 September 2016 Actuarial gains and losses 6,876 1,901 4,975 Change in the revaluation reserves 17,743 3,329 21,072 Other comprehensive income for the period 24,619 1,428 26,047 1 January to 30 June 2015 Actuarial gains and losses 4,713 1,294 3,419 Change in the revaluation reserves 19,427 4,443 14,984 Other comprehensive income for the period 14,714 3,149 11,565 Other comprehensive income for the period Before tax Tax After tax thousand 1 July to 30 September 2016 Actuarial gains and losses 1, ,109 Change in the revaluation reserves 3, ,753 Other comprehensive income for the period 2, ,644 1 July to 30 September 2015 Actuarial gains and losses Change in the revaluation reserves 8,714 1,097 7,617 Other comprehensive income for the period 7, ,908

33 Interim financial statements 31 Measurement of financial instruments The fair value is measured at a financial instrument price determined on an active market (level 1 valuation hierarchy). For debt instruments, these are primarily transaction prices and quotations on the interbank market. For equity instruments, the fair value is measured using market prices, and for fund units, the fund s net asset value is used. If no quoted prices for identical or similar financial instruments are available, valuation models that use market data as parameters to the greatest extent possible are used to determine the fair value (level 2 valuation hierarchy). The comdirect group primarily uses the discounted cash flow method. Discounting is performed at interest rates and credit spreads observable on the market. The interest rates have been transferred generally from the three-month swap curve. The instrument or issuerspecific credit spreads are determined using, for example, the Pfandbrief curve or highly liquid bonds of an issuer. If current verifiable market data is insufficient for valuation with valuation models, unobservable inputs are also to be applied (level 3 valuation hierarchy). These initial inputs are from the perspective of the seller of an asset or a liability and take into account the assumptions that market participants would use for pricing. The risks inherent to the valuation method that is used and the incorporated input factors are to be included here. The consumer loans taken out by customers and the preferred stocks of VISA Inc. USA are allocated to level 3 of the valuation hierarchy. In the case of consumer loans this is the result in particular of individual customer behaviour not observable on the market, which is expressed as individual default risk. This leads to an adjustment of the discounting interest rate as part of determining fair value with the discounted cash flow method. In addition to interest, credit and liquidity risks, the discount curve applied also takes into account administrative expenses and a profit margin. Compared with the other influencing factors of the fair values, in particular interest rate risk, the default risk relating to the overall portfolio largely recedes into the background. The value of preferred stocks of VISA Inc. USA can be derived from their stock exchange price due to the later exchange to common stocks of VISA Inc. USA. Because they are listed in US dollars, the exchange rate to euros has an effect on the fair value. There is uncertainty regarding the later exchange ratio. This is affected by possible losses of VISA Inc. from legal risks in connection with the transaction. This is a non-observable parameter with future effects. Discounts to be accounted for arising from the illiquidity of the preferred stocks are also non-observable. The parameters named are estimated on the basis of earlier transactions with comparable risks. Overall, this results in a moderate valuation discount of the market value of the shares translated into euros. Transfers between hierarchical levels are reported as of the last day of the relevant quarter. Further information on the valuation hierarchies may be found in the tables section of the Notes. Asset impairments The result from financial investments in the current financial year includes impairment losses of 335 thousand (previous year: 247 thousand). As in the previous year, this amount fell entirely within the third quarter.

34 32 Provisions for possible loan losses In the balance sheet, the provisions for possible loan losses are deducted from the respective receivables. The provisions for possible loan losses amounting to 2,585 thousand (31 December 2015: 2,626 thousand) relate in full to claims on customers. Provisions were also recognised for risks relating to unutilised credit lines of 4,556 thousand (31 December 2015: 5,820 thousand). The reduction in amounts is the result of the partial reversal of portfolio loan loss provisions which was due to a validation of applied parameters in the risk models. Contingent liabilities The German banks compensation fund has granted the option of an irrevocable payment obligation of up to 30% of the annual contribution for the current contribution year from 1 October 2015 to 30 September comdirect bank AG has made use of this option by depositing cash collateral with the Deutsche Bundesbank. A contingent liability to the German banks compensation fund arises from the irrevocable payment obligation. Related party disclosures The parent company of comdirect bank AG is Commerz Bankenholding Nova GmbH, Frankfurt/Main. The ultimate parent company is Commerzbank AG, Frankfurt/Main. comdirect bank AG uses services provided by Commerzbank AG through a general agreement effective as of 1 January 1999, as well as through service level agreements on this basis. On 6 August 2007, a master agreement was concluded with Commerzbank AG which superseded the existing general agreement. The individual contracts concluded under the general agreement remain in place until expiry of their respective term. New individual contracts are concluded on the basis of this master agreement. As part of money market and capital market transactions, comdirect bank AG makes investments with Commerzbank AG and its affiliated companies. These transactions are collateralised in return for payment under an assignment agreement. For placement activities for the benefit of ebase GmbH, Commerzbank AG receives sales and sales follow-up commission. As part of its processing and management services for custody accounts, ebase GmbH procures support services from Commerzbank AG.

35 Interim financial statements 33 During the reporting period, there were financial relations with related natural persons (members of the Board of Managing Directors and the Supervisory Board and members of their immediate family), including through the use of products of comdirect group as part of the normal product and service offering. All products and services were provided on the basis of normal third-party terms and conditions and are of secondary importance for the company. The related parties did not accrue any unjustified advantage from their position with the comdirect group, nor did the comdirect group suffer any financial losses. For further information, please see note (19) in our financial report for financial year Quickborn, 1 November 2016 The Board of Managing Directors Arno Walter Dietmar von Blücher Dr Sven Deglow Martina Palte