Commerzbank Conference Call Q2 2002 results August 8, 2002 Dr. Thomas Naumann, Head of Accounting and Taxes Ulrich Ramm, Head of Corporate Communications Jürgen Ackermann, Head of Investor Relations
1 Commerzbank: Key messages for 1st half 2002 Earnings 2,884m euros -17% (Decline mainly due to difficult market conditions) Operating expenses 2,706m euros -7% (Decreased more than planned, and better than analysts forecasts) Pre-tax profit 178m euros and after-tax profit 120m euros positive (In 2nd quarter, further modest positive results achieved, without extraordinaries, but incl. goodwill amortization) Risk-adverse business policy Risk-weighted assets 199.3bn euros (-11.3% y.o.y.) stabilizes equity ratio Core capital ratio (incl. market risk) 5.9% Own funds ratio (incl. market risk) 10.5%
2 Commerzbank: Net interest income stable Lower-risk lending policy reduced interest income The rising margin trend in domestic corporatecustomer business gives cause for optimism However, the lower interestrate level reduced income on the liability side Appreciation of the euro reduced interest income 1000 900 800 700 600 500 905 929 888 873 859 861 752 753 617 619 532 553 Q1 Q2 Q3 Q4 Q1 Q2 2001 2002 Net interest income before provisioning ( m) Net interest income after provisioning ( m)
3 Strong margin increase in domestic corporate business 1.25% 1.20% 1.15% 1.10% 1.05% 1.00% 0.95% 1.23% 1.16% 1.14% 1.07% 1.03% 1.03% 1.05% 1.01% 1.01% 0.99% 1Q00 2Q00 3Q00 4Q00 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 Gross margin (loans fixed/variable)
4 Commerzbank: Borrowing, by rating category Credit rating R 0.0/ 0.5 R 1 R 2 R 3 R 4 R 5 R 6 Total Investment grade Non-investment grade euro bn 21 20 22 17 37 36 33 33 9 9 2 3 9 10 133 128 5.8 5.9 3.8 3.7 10.2 11.8 13.0 12.6 6.2 Private Customers: Domestic Corporates: Foreign Corporates: Domestic 6.2 5.6 18.2 18.5 20.8 3.8 18.7 16.3 16.6 3.5 2.2 2.1 3.3 10.4 2.3 2.0 1.2 0.8 7.4 4.3 4.7 0.4 0.5 2.1 0.6 4.9 5.7 0.7 0.6 0.8 0.5 1.8 1.1 12/00 06/02 12/00 06/02 12/00 06/02 12/00 06/02 12/00 06/02 12/00 06/02 12/00 06/02
5 Commerzbank: Commission income is recovering from its Q4 low Difficult stock-exchange environment is preventing return to early-2001 level in m 613 603 569 575 554 Parent bank maintained securities commissions at 1st half 2001 level during first six months 482 Q1 Q2 Q3 Q4 Q1 Q2 2001 2002
6 Commerzbank: Trading profit very volatile Trading in shares and other price risks fell sharply in Q2. Results for interest-rate risks a good third higher in Q2 Forecast for year as a whole only possible with reservations, due to high volatility of trading profit in m 312 290 58 537 313 104 Q1 Q2 Q3 Q4 Q1 Q2 2001 2002
7 Commerzbank: Net result on investments and securities portfolio Q2 result slightly below average for the last five quarters Commerzbank did not sell any major shareholdings in Q2 in m 129 50 114 92 60-74 Q1 Q2 Q3 Q4 Q1 Q2 2001 2002
8 Commerzbank: Cost-cutting programme making successful progress Progress to date indicate that the overall outcome may be even better than the target of 5.5bn Workforce of 40,400 (Sept. 2000) reduced to 38,017 (end- June 2002). Further reductions are being made in m 1,430 1,479 1,459 1,487 1,398 1,308 Q1 Q2 Q3 Q4 Q1 Q2 2001 2002
9 Commerzbank: earnings performance (in m) Q2 2002 Q1 2002 H1 2002 H1 2001 Pre-tax profit 25 153 178 569 Taxes 6 52 58 212 After-tax profit 19 101 120 357 Profit attributable to minority shareholders -17-29 -46-55 Net profit 2 72 74 302 Earnings per share ( ) 0.01 0.13 0.14 0.56
10 Commerzbank: Retail Banking Return on equity (in %) 0.6 0 3.6 3.9 507 496 524 485 514 502 519 396 502 485 476 454-3.4-18.0 Cost/income ratio (in %) 96.2 101.6 100.2 110.9 90.7 85.8-11 -39-12 -123 17 22 Income, total Operating expenses Profit from ordinary activities S Reduction in operating expenses more than compensated for lower operating earnings: cost/income ratio significantly improved S comdirect s concentration on Germany should lead to a positive development
11 Commerzbank: Asset Management Return on equity (in %) 15.4 6.4 12.2 19.3 104 136 160 155 137 136 97 75 98 135 123 104-6.9-31.3 Cost/income ratio (in %) 206.7 130.8 116.8 140.2 137.8 118.3-32 -23-39 -80-37 -19 Income, total Operating expenses Profit from ordinary activities S Asset management division in a turnaround situation S The strategic realignment (termination of foreign activities) will lead to higher profitability
12 Commerzbank: Corporate Banking and Institutions Return on equity (in %) 618 348 270 660 561 387 365 396 273 567 202 165 562 350 212 474 307 167 10.7 12.1 11.9 8.4 10.9 9.3 Cost/income ratio (in %) 49.2 48.1 48.7 51.6 45.8 43.6 S 46% of the Group s equity is tied up in this sector Income, total Operating expenses Profit from ordinary activities S The systematic reduction of operating expenses is contributing to the positive earnings trend
13 Commerzbank: Securities Return on equity (in %) 13.2 7.1 33.6 305 305 278 239 224 229 202 124 66 76 219 191 148 238-2.9-33.4-17.6 Cost/income ratio (in %) 246.0 78.4 97.8 72.7 114.7 160.8 5-181 -28-90 Income, total Operating expenses Profit from ordinary activities S Earnings targets were missed in the first half of this year S Increase of Q2 operating expenses was caused by higher cost allocation from head office
14 Commerzbank: Treasury Return on equity (in %) 105.6 227 40.1 52.2 45.8 44.2 33.3 178 124 168 121 108 178 153 123 Cost/income ratio (in %) 61.8 55.4 51.0 30.3 35.7 21.6 54 60 67 54 49 7875 76 47 S Lower interest rate level weakened performance in Q2: nevertheless still high ROE ratio Income, total Operating expenses Profit from ordinary activities
For more information, please contact: Commerzbank Investor Relations Tel. +49 (69) 136 22 33 8 ir@commerzbank.com