Jeremy Sigee

Jeremy Sigee sought clarification on the group's double leverage calculation, noting it appeared to be heading below 100%, and inquired about client behavior in Asia given strong flows but softer revenues.

Answer

CFO Todd Tuckner clarified that after accounting for share repurchases as an offset to upstreamed dividends, the double leverage ratio is projected to be around 103% by year-end. Regarding Asia, he noted sustained momentum but also a 'wait and see' sentiment from clients due to macro uncertainty, leading to more tactical portfolio repositioning.

Jeremy Sigee asked if the full accrual of the 2025 share buyback implies an intention to execute it regardless of upcoming regulatory rules, and questioned how wealth management clients are reacting to U.S. tariffs announced in April.

Answer

Sergio Ermotti, Group Chief Executive Officer, clarified that the buyback accrual is based on current strong performance and capital but remains contingent on no material, immediate changes to the regulatory regime. He added that while client activity spiked in early April, it has since normalized to a more cautious, "wait-and-see" attitude.

Jeremy Sigee of BNP Paribas inquired about the Investment Bank's capital markets revenue growth, which lagged peers, and asked about the feasibility of further reducing the CET1 ratio in the UBS Americas subsidiary.

Answer

CFO Todd Tuckner explained the IB's capital markets performance reflects being underweight in DCM and a pipeline build in ECM that will yield results later in 2025. He confirmed UBS is targeting a lower CET1 ratio for its U.S. IHC, aiming for the upper teens, which is equivalent to 13-15% under Swiss standards.

Jeremy Sigee asked for an updated outlook on the P&L drag from the Non-core and Legacy unit for 2025, given its better-than-expected performance, and questioned the drivers behind the Investment Bank's rising cost/income ratio.

Answer

Executive Todd Tuckner responded that despite strong recent performance, the bank's guidance for the NCL P&L drag at the end of 2026 remains its best estimate for now, with a potential update later in the year. He attributed the quarter-on-quarter increase in the Investment Bank's costs primarily to compensation-related effects.

Jeremy Sigee of BNP Paribas S.A. asked about the guiding priorities for Deutsche Bank's next multi-year business plan beyond 2025 and what management's definition of success would be for this new strategic phase.

Answer

CEO Christian Sewing outlined three guiding principles for the next plan: maintaining the four-business structure with a focus on growth in the Corporate and Private Banks in Europe, reinforcing the bank's role as a global European alternative for clients, and shifting focus from restructuring to growth and optimization. Success will be defined by improving returns on deployed capital through the SVA framework and further optimizing the operating model to reduce costs.

Jeremy Sigee from BNP Paribas asked about the materiality of the European Savings & Investment Union over a three-year horizon and whether it could meaningfully impact the bank's RoTE.

Answer

CEO Christian Sewing affirmed that the initiative is material, presenting significant opportunities for the bank's capital markets businesses to support increased investment in areas like defense and infrastructure. He also highlighted the potential upside from German pension reforms, which would drive retail investment flows through the bank's Private Bank and DWS platforms. While not yet in the detailed plan, he sees it as a source of future upside.

Jeremy Sigee from BNP Paribas sought clarification on a 50 basis point 'other' improvement in the CET1 capital walk, asking if it was a recurring item. He also questioned if the bank's strategy regarding AT1 capital instruments had changed following the events at Credit Suisse.

Answer

CFO Evie Kostakis confirmed the 50 bps capital improvement was a one-off event from a sale in the treasury portfolio and would not be repeated. CEO Philipp Rickenbacher stated that while the AT1 market has seen displacement, loss-absorbing capital remains relevant, and he expects industry discussions in 2024 to establish new terms for the market's future.

Jeremy Sigee asked about the key organic growth drivers, inquiring about the profile and regions of new relationship manager (RM) hires and the outlook for net new money flows in 2023.

Answer

CEO Philipp Rickenbacher explained that the hiring focus is on experienced RM talent in key markets, with an expected acceleration in Asia. He also noted the development of a new generation of RMs internally. While not providing a specific target, he expressed confidence in continuing and extending the positive net new money dynamic from H2 2022 into the new year.

Jeremy Sigee of BNP Paribas inquired about the potential "pull to par" effect on the Other Comprehensive Income (OCI) and its expected annual basis point impact. He also asked for a strategic update on the company's pivot to growth, questioning if the phase of divestments and adviser shrinkage was now complete.

Answer

CFO Evie Kostakis explained that with roughly 30% of the treasury portfolio maturing within a year, the 140 basis point OCI impact is expected to reverse over the next few quarters. CEO Philipp Rickenbacher confirmed that the strategic realignment and divestment phase is now broadly concluded, allowing the firm to focus its resources on growing its core business.