DWS (Deutsche Asset Management) Aktie

Ladies and gentlemen, welcome to the DWS Q1 2026 Results with Investor and Analyst Conference Call. I am Shari, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Oliver Flade. Please go ahead.

Yes. Thank you very much, operator, and good morning from sunny Frankfurt. This is Oliver Flade from Investor Relations, and I would like to welcome everybody to our earnings call for the first quarter of 2026. Now before we start, I would like to remind you, as usual, that the upcoming Deutsche Bank analyst call will outline the Asset Management segment results, which have a different perimeter basis to the DWS results that we are presenting now.

I'm joined also as usual, by Stefan Hoops, our CEO; and Markus Kobler, our CFO. And Stefan will start with some opening remarks as well as some closing remarks, and Markus will take you through the main part of the presentation. And for the Q&A afterwards, please could you limit yourself to the 2 most important questions so that we can give as many people a chance to participate as possible. And I would also like to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. I therefore ask you to take note of the disclaimer and the precautionary warning on the forward-looking statements at the end of our materials.

And with that, I will now pass on to Stefan.

Thank you, Oliver. So for the second time in a row, our Head of Investor Relations muted me just after my thank you, Oliver. So thank you, Oliver. Good morning, ladies and gentlemen, and welcome to our Q1 2026 earnings call. It is not easy to describe the environment we are in right now. It is clearly a difficult environment for the world and an unpredictable one. I mean, who would have thought a couple of months ago that the U.S. would block the Strait of Hormuz. The best description I've heard was this. It feels like we are currently living through what will be the toughest part of the history exam for the class of 2085.

Now for asset managers, this environment is highly relevant for 2 reasons. First, it is fertile ground for active asset management. The more volatile and dispersed markets become, the stronger and more opposing views tend to be. And honestly, if you cannot create alpha in this environment, then when. That is why I'm pleased with our investment performance over the last few months, particularly across our large retail funds. Our Top Dividende fund, for example, was up 8.46% as of 31st of March, which is ahead of major indices. That has supported nice inflows and higher management fees through above-market growth in assets under management in this fund. Other flagship funds like Akkumula and Vermogensbildungsfonds I have also performed well, while Concept Kaldemorgen has managed volatility effectively and has moved into performance fee territory in Q2.

Second, in an environment like this, it is critical to operate at a low cost/income ratio. This is exactly the kind of environment we have prepared for and work towards. As I said when I walked you through the logic 2 years ago, the cost/income ratio for an asset manager is similar to the leverage ratio for banks. It is a measure of how well you are prepared for a weaker environment. A high earnings per share with a high cost/income ratio is dangerous because volatility can impact the bottom line very quickly. That is why we focus on maximizing earnings with a binding constraint of a low cost/income ratio. Operating at a comparatively low cost/income ratio leads to more earnings stability and allows us to keep investing in growth organically and potentially inorganically.

Markus will come back to that in more detail. Against that backdrop, we delivered a solid first quarter. Earnings per share came in at EUR 1.32 and above consensus, although this was largely driven by the timing of our PIF II performance fees. Revenues were EUR 821 million, up 9% year-on-year, while net income increased to EUR 265 million, up 33% year-on-year. Our reported cost/income ratio improved to 54.1%, down 8.1 percentage points year-on-year, and our cost base of EUR 444 million was encouraging, underlining that cost discipline remains firmly in place.

To summarize, costs were a bit better, flows were a bit weaker given the tough March and performance fees came in earlier than expected. Markus will go through that in more detail. For the full year, we reconfirm our target. Markets have shown a V-shaped recovery over the course of April. This means that our assets under management are now back at broadly the same level we were at the end of February. At the same time, there's still a revenue impact from the interim volatility. The AUM dent in March and April amounted to around EUR 40 billion, which translates into a revenue gap of about EUR 20 million. And of course, we need to remain mindful of the current environment.

The level of uncertainty remains elevated, warranting a degree of caution. Fortunately, if you recall our last quarterly earnings call, we had full focus on additional cost levers, and that has now paid off very nicely. We are ahead of plan following the actions we took early in the year, allowing us to tighten our cost guidance to around EUR 1.80 billion for the year, helping to offset the revenue gap. At the same time, performance fees have already been delivered on a large part of PIF II, giving us confidence that we will be at the upper end of our 4% to 8% of revenues guidance range. So taken together, we reconfirm our target of 10% to 15% EPS growth for the full year, assuming markets remain constructive.

Now before I hand over to Markus, I'm pleased to tell you that Markus has just extended his contract at DWS and will be my partner for at least another 3 years. Now with that, over to Markus.

Thank you, Stefan. It's a privilege. It's one of the most exciting CFO positions in the industry. And I think we have a duty also as a European-based asset manager to succeed. More to come. Thank you, and good morning, ladies and gentlemen. Before I take you through our financial performance, let me start by saying that I hope you are all navigating this period well. As Stefan already mentioned, the environment we are in right now is clearly not an easy one. It is complex, volatile and to a certain extent, unpredictable.

With that, let me turn to our financial snapshot for the first quarter. Total assets under management increased by 8% year-on-year and flat quarter-on-quarter to EUR 1,093 billion. Total revenues stood at EUR 821 million, representing a 9% increase year-on-year and 9% decrease quarter-on-quarter. Our total costs decreased 5% year-on-year and 9% quarter-on-quarter and totaled EUR 444 million. This resulted in a reported cost/income ratio of 54.1% for the first quarter of 2026. As a consequence of our strong operating leverage, our net income increased by 33% year-on-year and decreased 10% quarter-on-quarter, reaching EUR 265 million.

Moving to our client dynamics during Q1. Whereas we saw a solid start into Q1 with a healthy flow momentum during January and February, overall activity slowed down in March following the geopolitical developments and the resulting market uncertainty. Clients remain cautious with a focus on liquidity and defensive positioning. Overall, we reported net flows of EUR 11 billion and long-term net flows of EUR 6.6 billion. Total retail flows stood out with EUR 12.9 billion of net flows, marking the 13th consecutive quarter of positive flows, demonstrating the resilience of our franchise despite elevated volatility.

Client demand remains supported by our digital distribution channels. On the institutional side, we reported net outflows of EUR 1.9 billion. Client activity in the institutional space was more restrained in March amid heightened market uncertainty. This was less a question of underlying demand and more one of timing with clients taking a more cautious and selective approach to new commitments while prioritizing capital preservation.

Looking at the regions. In the Americas, we saw net outflows of EUR 5.1 billion, mainly impacted by institutional cash outflows at the end of March. These were driven by seasonal tax payment effects. However, we already see a reversal of these flows in April. Total net flows into our home market, Germany, amounted to EUR 7.9 billion, driven by an ongoing demand for passive, including Xtrackers. EMEA, excluding Germany, saw EUR 7.7 billion of net flows, demonstrating strong client engagement across the region as clients are increasingly receptive to European investment opportunities as well as for our high-margin retail products. APAC reported EUR 0.5 billion of net flows in the first quarter and saw continued asset rotation to higher-margin alternative products.

Moving to the quarterly highlights within our active business. The first quarter reflects a more volatile market backdrop, which impacted overall active flows, while underlying client demand remains strong across selected areas of our active platform. Active assets under management stood at EUR 458 billion, broadly stable quarter-on-quarter. Active equity reported net outflows of EUR 1.2 billion, primarily reflecting client derisking in response to heightened market volatility. Multi Asset reported positive net flows of EUR 0.3 billion across both retail and institutional channels, including continued demand for our flagship fund Concept Kaldemorgen.

SQI was a clear beneficiary of the current market environment with continued positive momentum, reporting EUR 1.6 billion of net flows. This was mainly driven by white label partnerships as well as inflows into quantitative strategies, including a significant mandate in the Middle East region. Fixed income flows were impacted by specific institutional mandate losses in the U.S. and APAC. At the same time, retail demand remained positive, particularly for DWS floating rate notes. Product innovation remains supportive for our active franchise. Recent launches include our DWS Invest Focus Europe and 2 new active Xtrackers UCITS ETFs.

Moving to our Xtrackers business. Passive, including Xtrackers, faced a demanding quarter and delivered net flows of EUR 6.5 billion, marking the 13th consecutive quarter of positive flows. Assets under management increased to EUR 396 billion, stable quarter-on-quarter. Overall, our Xtrackers flow momentum was considerably weakened in March after a solid start to the first quarter. The main flow contributor was our UCITS business, which delivered net flows of EUR 3.8 billion. We saw clients rotating away from traditional benchmarks, which are heavily skewed towards the so-called Magnificent 7 stocks, resulting in positive flows into strategies with benchmarks such as Equal Weight and World ex U.S.

Our Mandates & Solutions business recorded sizable net flows of EUR 2.9 billion into existing mandates and new fundings alongside continued momentum in our partnership products, including via digital channels. Our U.S. Domiciled ETFs saw outflows of EUR 0.2 billion in the first quarter, mainly driven by outflows in high-yield ETFs. However, we successfully launched the Xtrackers Europe Defense Technologies ETF, further broadening our thematic offering. We also continued to expand our strategic footprint through 2 new digital distribution partnerships in EMEA, driving further expansion across key European markets. As mentioned in the previous quarter, the contribution of these digital partnerships to our overall Xtrackers flows continues to increase.

Let me turn to our Q1 highlights for our alternatives platform. In Q1, assets under management totaled EUR 112 billion, up 4% quarter-on-quarter. Our alternatives business delivered overall net flows of EUR 0.2 billion in the quarter, supported primarily by demand for liquid real assets. Infrastructure contributed EUR 0.1 billion of net flows and saw sustained investor interest in our flagship infrastructure strategies. Infrastructure flows in Q1 were impacted by a significant capital repayment to the fund investors related to 2 PIF II asset sales. Capital repayments to fund holders are a usual part within our infrastructure business.

They result from investments and realizations, which generate corresponding performance fees at the end of a fund's life cycle and therefore, are in the best interest of our clients and shareholders. In Q2, we expect another capital return to PIF investors of around EUR 1 billion, which will be accounted as outflows but are beneficial for our clients as just outlined. We further continue to benefit from strong investor appetite for Europe's structural transformation.

In Liquid Real Assets, flows remained positive in the quarter, recording EUR 0.6 billion. We saw a momentum shift in client sentiment with increasing levels of renewed interest in core tailored strategies, particularly in listed real estate and infrastructure. The sentiment for real estate remains mixed, reporting EUR 0.6 billion of net outflows. European retail appetite continues to be subdued, while institutional client interest in both Europe and the U.S. stayed resilient. Private credit remains a strategic growth priority for DWS with several marketing initiatives progressing during the quarter. And product innovation continued with the launch of 3 new LRA mandates across infrastructure securities. We also expanded our LRA offering in the growing U.S. retail market.

Let me move now on to our Q1 revenue development. Total revenues reached EUR 821 million, up 9% year-on-year and down 9% quarter-on-quarter. Management fees were stable quarter-on-quarter, marking EUR 673 million. Performance and transaction fees totaled EUR 109 million and include a substantial performance fee contribution from our PIF II fund as a result of further asset sales in Q1. We do not anticipate further asset sales before the fourth quarter of 2026. And as Stefan mentioned, we reiterate that we will be at the upper end of our 4% to 8% of revenue guidance range. However, we anticipate that the vast majority of remaining performance fees to be booked in Q4 2026. Other revenues amounted to EUR 39 million, which reflects an EUR 18 million net interest income contribution as well as a EUR 15 million contribution from Harvest.

Let me move on to our cost development. We are particularly proud that our total costs have continued to decrease, which is a result of decisive action and a clear testament to the strength of our sustained and proactive cost management approach. We identified early on that managing our resources and cost base, especially our discipline-based costs would be essential to our long-term success. Particularly in times like these, the benefits of this approach become even more crucial.

In Q1, total costs stood at EUR 444 million, down 9% quarter-on-quarter and down 5% year-on-year. Compensation and benefits decreased to EUR 239 million, down 4% versus the previous quarter, mainly driven by lower severance costs and despite one-off carry costs linked to PIF II performance fees of EUR 16 million. General and administrative expenses totaled EUR 205 million, a 14% reduction quarter-on-quarter, reflecting seasonal adjustments, which typically occur in the fourth quarter. This translates into a reported cost/income ratio of 54.1%, reflecting higher revenues and continued efficiency gains resulting from our disciplined cost management approach.

Before handing back to Stefan, let me provide an update on the focused measures which we outlined in the previous quarter to support our financial targets. As Stefan outlined earlier, our strategic direction remains unchanged, and we continue to execute our strategy with discipline in order to reach our medium-term financial targets. Let me briefly recap our achievements as well as current progress on the cost side.

As discussed in previous quarters, we continue to distinguish between 2 categories of costs, volume-based costs, which naturally rise alongside organic growth and discipline-based costs, which we are constantly optimizing as they remain in our control. While a flat cost base may look similar across companies, the substance can be fundamentally different. A company can deliver flat cost by simply doing nothing, particularly by not investing into growth. That is not our approach. Our approach focuses on targeted investments through active reallocation of resources in the context of rising volume-based costs, which reflect the ongoing growth of our business.

By counterbalancing these good costs with reductions in disciplined cost categories, we maintain strict cost discipline while continuing to invest into growth. We thereby focus on 3 core levers to further reduce our disciplined cost base. First, human capital management. People remain our key differentiator. We are further enhancing our human capital management through limited external hires, promoting internal mobility, which has already realized financial and nonfinancial efficiency gains. Second, target operating model adjustments. Following a comprehensive review of structures and processes, we have moved decisively from assessment into execution.

We continue to simplify organizational setups, streamline selected teams and sharpen accountability across functions. This supports a leaner and more effective operating model fully aligned with our strategic priorities. And third, IT and operations optimization. We are progressing a range of initiatives focused on automation, artificial intelligence and process simplification. In parallel, we continue to leverage offshoring and near-shoring capabilities, helping us to improve efficiency, resilience and service quality across our operations.

Overall, these measures continue to strengthen our operating platform and provide us with further efficiency gains. Those create even more capacity for continued investment into growth initiatives, which is particularly important in a volatile and uncertain market environment as we currently have.

Let me hand over to Stefan to elaborate on our growth initiatives.

Thank you, Markus. As Markus outlined, we feel comfortable with our updated cost guidance and importantly, with our ability to continue investing in our growth initiatives. Let me therefore briefly come back to what we said at our full year results and give you a quick update on our 5 growth priorities. Overall, we are fully focused on executing our growth plan. Starting with our ambition to be top 5 in the top 5. In the first quarter, we reached an important milestone in our strategic partnership with Nippon Life India Asset Management. We signed the agreement to invest in the alternatives platform, taking a 40% stake in formalizing our role as a strategic partner in building out India-focused alternatives capabilities.

At the same time, we remain interested in increasing our stake in Harvest Fund Management as part of our long-term growth strategy in China. Second, on gateway to Europe. We continue to see strong and sustained interest from international investors. Importantly, the geopolitical volatility we saw in the first quarter has not slowed that momentum. If anything, we continue to see interest deepen alongside a growing recognition that Europe is coming together in a more coordinated way. Third, on the future of finance. We continue to make progress in building out our digital capabilities. During the quarter, our joint venture or Unity issued a Swiss franc stablecoin with further initiatives already in the pipeline.

Fourth, on Bullish Germany. Here, we saw important regulatory clarity in the first quarter with the German Bundestag approving the private pension reform and expected publication of the new law in May. Our dedicated project team is set up to ensure we're well prepared and positioned to capture the opportunity as this develops, particularly as we move towards implementation in January next year. And finally, on our Global Hausbank approach. Following our last earnings call, we announced the intention to expand our strategic collaboration with Deutsche Bank's Private Bank into the area of discretionary portfolio management.

The aim is very clear, to combine the client reach and experience of Deutsche Bank's Private Bank with DWS' institutional-grade investment capabilities. We believe this is a natural extension of our partnership and an important step in strengthening our role in serving private wealth clients. So across all 5 priorities, we are making tangible progress while continuing to build for the long term. Stepping back, we feel that we are operating from a position of strength. In a more volatile environment, our investment performance is improving. Our cost discipline is paying off, and we're continuing to invest in our long-term growth priorities.

As we said at our full year results, managing costs requires discipline and consistency. Growing revenues sustainably is harder. It takes clarity on where we truly have an edge, disciplined resource allocation and patience as platforms scale. We've laid that groundwork over the past few years, which is why even in a more volatile environment, we remain optimistic about the future, but uncompromising in execution. Taken together, alpha generation, cost control and focused delivery is what differentiates us as an active asset manager and gives us the confidence to reconfirm our full year target of 10% to 15% EPS growth.

Thank you, and back to Oliver for Q&A.

Thank you very much, Stefan. And operator, we're ready for Q&A now. If I just might remind everybody to limit yourself to the 2 most important questions that would be very kind. Thank you very much.

[Operator Instructions] The first question comes from the line of Jacques-Henri Gaulard, Kepler Cheuvreux.

Two quite quickly from me. In active equity, you talked, Stefan, last quarter, if I remember well, of a turnaround here. Could we interpret the minus 1.2% as a blip, which is really risk adverse? And do you have the feeling that it was just something that is due to the circumstances really and not something that should impede, I would say, the turnaround trend that you identified then?

And then the second point, could you spend just 10 seconds on it, which is more the Bullish Germany pitch, which I would like to hear in a little bit more detail from you because it's important for your investors in light of the fact that it's been a little bit of a slow start and to which extent you still have a high degree of confidence considering that the impact when you look sector by sector is far from being completely harmonized yet?

Great. Thank you, Jacques-Henri. And I guess both questions are sort of related because the sort of significant revenue upside we see from Bullish Germany is active equity related, and I'll come to that in a second. Now on your first one on active equity, we remain optimistic that the momentum has materially shifted into the positive territory. Now Q4 versus Q1, I understand if you just look at the numbers, it looks like you sort of took a step back. But I think you know that there's some seasonality in that behavior. So Q4 has some advantages because of essentially the ability of people to reinvest performance in -- or either upside in the funds, essentially dividends in the funds that otherwise, they would be able to take out and they kept them into a slightly easier pitch than finding new clients.

And if you compare Q1 '26 to '25, I think you see the positive momentum. And then underlyingly, and we don't disclose it, but I can try to give you some guidance. If we differentiate between essentially retail end buyers and fund buyers, so DPM or, let's say, more professional investors, then we look very strong with the end clients, with the retail clients and across Europe with the exception of one country that interestingly houses a couple of very, very large asset managers, and it's like French speaking. But with the exception of this one country, we are positive in every country in Europe in active equity, so in wealth in retail flows. If you look at some of the big flagship funds like Top Dividende, that had positive inflows.

So overall, we feel good about active equity. And look, I think in the past, some of you have very fairly criticized our investment performance, which obviously is a leading indicator for future inflows. You see that over the last sort of 24 months, we made a bunch of changes, takes some time, right? It's the pumping heart of DWS, so you cannot really make -- do changes over time -- sorry, instantaneously, but it needs to be over time. But with a new setup and with people like Andre Koettner and Thomas Schuessler, fully focused on managing their funds as opposed to also managing the platform, I think the performance shows, right? So that's why we're also not just optimistic in what we see, but also the leading indicator of strong performance.

Now Bullish Germany, if you recall, our definition was that we have always been optimistic about Germany, but we're now turning even more bullish because of a bunch of -- to be -- give credit where credit is due to a bunch of changes that politicians in Berlin have really been driving. Now the big infrastructure, big spending and so on, that's more something which you will see translate into flows in alternatives. But the pension reform is something which will offer significant upside to active funds, active equity, active multi-asset, I think also active alternative funds. I think given that there's like a tight schedule today with Amundi's call starting 11 -- I'm probably not going to do a full teach-in on the private pension reform in Germany.

But now that it's clear what you can do, now it's clear what the fees could be now that the structure is clear, I think the key punchline is that going forward, you can actually generate yield. So in the past, it was always capital protected, meaning also very low yield-generating funds that were part of the Riester-Rente. Going forward, there's going to be much more focused on allowing pensioners to also with long-term investments generate long-term yield and therefore, wealth accumulation. And obviously, that's quite conducive to our strong performing equity funds.

The next question comes from Nicholas Herman from Citi.

Two for me as well, please. Firstly, on your Hausbank ambition. So Deutsche Bank's Private Bank has said that they want to double DPM volumes in the next 3 years. I guess with that partnership, what proportion of those volumes would you expect to get? And how should we be thinking about the incremental revenues and/or margins associated with that volume? That's the first one.

And then on your infrastructure funds and carried interest. Could you please -- I guess a 2-part question here. But could you remind us what the total expected carried interest from PIF II is and how much has been booked to date? And I guess somewhat related, what is the expected carried interest from PIF III if you were to hit your target returns? And any kind of indication on timing or recognition of that carried interest?

Perfect. Thank you, Nicholas. The -- so I think I'm looking at Markus probably taking both questions. So on Hausbank, so when you look at the essential workflow between Deutsche Bank's Private Bank and us, so far, they do the majority of steps. So obviously, we're closely aligned and our CIOs aligned and so on. But right now, I'm simplifying a little bit, but they're essentially running their own asset management operation in the sense of having portfolio managers, trading execution, they're covered. I mean, they do all the things that we would also be doing.

Now they're doing it very well, but Claudia and the team have had the perspective that with the ambition to significantly grow in DPM that their clients who are very well covered by Deutsche Bank's Private Bank sort of deserve institutional grade asset management execution, right? So far, so good. However, going forward, given that they want to grow, they want to move steps in that value chain over to DWS.

Now we haven't -- some of that is going to be sort of country-specific because in some countries, you require client consent and some others it's mostly a communication. Again, I think it's in the best interest of clients because they will continue to get the service from the Deutsche Bank's Private Bank plus have the upside of our much larger trading investment platform. But therefore, it's sort of difficult to break down how quickly that will move. However, I think the intention is that for the vast majority, wherever it's possible, for us to team up and partner.

Now how those revenues will be split, even though we are great partners, and Claudia and I are quite close. I suspect that he wants to have slightly more than 50% of those revenues given that arguably, the value creation is more on their side. So you shouldn't expect us to get a lion's share of it. But it's definitely upside because right now, we do not have any of those steps with the exception of when they buy ETF, they sometimes buy Xtrackers. But I think going forward, we will have some of the value chain and therefore, also some of the fees associated. We will be more clear on that going forward. So we announced the partnership after the last earnings call. A lot of things are currently being worked through. I think that we will be quite soon giving you more guidance, clarity, but also specific KPIs that you can track essentially for Deutsche Bank, but also for DWS.

Now on Infra, that's more straightforward and specific to answer. So for PIF II, everything but one asset is sold. So therefore, the performance fees you've seen in 2025. And the portion of PIF II performance fees as a percentage of total performance fees booked in Q1 was huge. So just assume the vast majority of the EUR 107 million was PIF II related. And there's only one asset remaining that should generate another, let's call it, EUR 30 million to EUR 40 million of performance fees, obviously, depends on price that asset still needs to be sold. That will likely come in Q4 this year. But that's it, right?

So then PIF II is fully sold to the point Markus made earlier, we returned EUR 0.5 billion of capital to the investors to the LPs in Q1. Another EUR 900 million will be returned in Q2. And then PIF II is basically done. Now PIF III is doing really well. So the investments are doing really well. But I would not expect PIF III-related performance fees in '26 or '27, maybe at the tail end of '27, but I think this is more likely to be '28 business simply because of timing and how long it takes to really optimize or generate value for the investments. And then PIF IV is obviously currently we're finalizing the fundraising with final close either Q2 or Q3, but definitely in 2026. And that will then take a few years before that generates performance fees.

Really helpful. Just one quick question, just one quick follow-up on PIF III, but sounding very clear. Can you remind us, please, what the target returns are either in terms of IRR or MOIC, that would be helpful.

I'm just looking at my colleagues because we're put in fundraising for PIF IV. So I just want to be careful in what I say, not say. So when you look at historical performance, our PIF funds are sort of a top decile, potentially even top percentile performer in mid-market infrastructure. So really strong performance. Now the headline return, what we essentially promised is low teens, 12%, 13%, I think, is what we promised. But then we aim to outperform. And so far, they have done a very good job in outperforming.

The next question comes from the line of Hubert Lam, Bank of America.

I've got 2 questions. Firstly, again, on PIF, but on PIF IV, did you book any inflows on PIF IV this quarter in Q1? And any update on the size and timing of the closing? I think you mentioned maybe it could go into Q3, particularly given the events in the Middle East, like any change because of this?

Second question is on passive flows or Xtrackers. Good inflows of EUR 6.5 billion in the quarter, but it seems like you're lagging some of your competitors now. Any reason you think for this? And how would you assess your passive growth here?

Thank you, Hubert. So on PIF IV, the target size is still EUR 4 billion plus, and we feel very good about that. If you recall, we were EUR 2.5 billion end of '25. We had some small inflows, a couple of hundred million in Q1 and then the lion's share is expected in Q2, potentially Q3. Now don't tell our sales folks. So we're still telling the sales folks, it's end of Q2 to make sure everyone remains focused. But yes, you're right, with the events in the Middle East, there's a chance that it slips a little bit. I have to say there's actually admirable -- if I can say that with respect, admirable focus from all of the big investors in the Middle East.

So they seem to manage sort of living through this and being very focused on the business. So I wouldn't expect a massive change. But typically, what you do is if there are a couple of investors which are very close and advanced stage, then you inform the other investors that you may remain open for a few very specific names for a couple of weeks, and that may be the case. However, essentially the difference between the EUR 2.5 billion we had end of '25 and the target of at least EUR 4 billion that will be booked in the calendar year 2026.

Now on Xtrackers, and let me actually address flow momentum slightly broader. And I will be specific on challenges in a second. But look, I may -- loving, caring father of 3 wonderful daughters and I love all my daughters the same. Now for us, as a fiduciary with EUR 1.1 trillion of assets, we care about all every single euro, dollar, sterling of those assets with the same care. Now I suspect that you guys, so analysts and shareholders, you don't love all of our AUM quite the same because they come with very different margins, very different cost-income ratios, profitability and so on.

Now when you look at and dissect our Q1 flows and look at Xtrackers, then I suspect you're actually quite happy about the strong inflows in S&P, Equal Weight, MSCI ex U.S., some of those more bespoke thematic ETFs, where we had very nice inflows, and they are close to 20 basis points in fee. Now if we had an extra EUR 12 billion, EUR 15 billion of 2.5, 3 basis points pure index replication, the headlines in Bloomberg and Reuters would have been more favorable, but I don't think that you would have cared too much, right? So therefore, I want our folks to fight for every single inflow. However, fight slightly more for the high-margin inflows. I'm quite happy with what I've seen in Q1.

When you look at -- and we just commented on the active equity, I'm actually quite satisfied with the flow picture with positive inflows in Top Dividende Concept Kaldemorgen, our big flagship funds. And again, I think the strong performance is a leading indicator for future flows. So I think when you dissect it, I think we've done fine, not amazingly, but fine in the higher-margin parts of the various asset classes. Now where we have a real issue, a real challenge is in institutional. And that is something which I've been saying for a while. Now I appreciate that by just me saying it, it doesn't make it better, and you are probably tired of me saying it. But we will make some changes around the whole value chain for institutional and value chain, I really mean brand, marketing, sales, how structuring is set up, how products are set up because we're just losing market share in institutional to really well-run strong competitors.

Next question comes from the line of Mike Werner, UBS.

Just a follow-up on your Bullish Germany pitch. Just when talking about the pension opportunities in particular, and how that's going to translate into active equity, what in the regulations is going to, I guess, favor active equity versus passive equity? We have seen other pension reforms in the past ultimately drive flows, but they tend to skew somewhat passive. So I was just wondering what you see different here.

Thank you, Mike. Just like we are listening and reading the transcripts of the call reports of our competitors, I suspect they will be doing the same. So therefore, I don't want to give like a recipe to global competitors. But just a couple of highlights to me. So historically, the subsidy, so both the contribution by the government, but also any tax benefits went to products which were capital guaranteed. So therefore, Germans like subsidies, Germans like tax benefits, and those came for the Riester products, which were capital guaranteed. Now going forward, the same advantages go to not capital guaranteed products.

So the government essentially said we want young folks to invest in the stock market and products have long-term wealth accumulation, and we provide the same subsidies and tax breaks to that versus capital guaranteed products. Now when you look at our -- and by the way, one more thing to add. When you look at the overall fees that the politicians deemed appropriate, that is sort of 1% for standard, but can be more for more tailor-made, so more -- maybe more interesting, more yield-generating products. So therefore, that also suggests that it's not just ETF focused, but really alpha-generating products.

Now when you look at our close competitors in Germany, so the Union and Deka, 2 very well-run strong asset management companies, they are active only. They do not have ETFs. So I wouldn't imagine or expect their products to contain ETFs because they are active only. So therefore, when you think about the picture in Germany, the regulator, the government wants alpha generation that is offered by active. Our competitors are active only. So there's nothing that really leads me to believe that this is going to be mostly ETF. Now obviously, we'll do whatever is in the best interest of the retail client and if they are strong ETF products by all means. But I think over a long period of time, we aim to beat markets and therefore, are bullish on those containing active equity, active multi-asset, active alternatives and these types of long-term alpha-generating products.

The next question comes from the line of Arnaud Giblat, BNP Paribas.

Two questions, please. First, on the stake, the 40% stake you've taken on Nippon Life India. I'm just wondering if you can quantify the amounts there and what growth or profitability could look like over the coming years? Second question is on private credit. I think that remains a strategic focus for you. I'm just wondering if you could flesh out a bit the progress you're making there.

Thank you, Arnaud. So NAM-India, so when you look at the AIF, which is owned by the publicly listed Nippon Asset Management India, that is roughly EUR 1 billion of AUM, it's like a proper company that's money making has been around for 10 years. So we are buying a 40% stake in a well-run living profitable company. We didn't disclose how much we paid. They didn't disclose it. But think about it as a reasonably high double-digit million amount. That's probably the best way to think about it. So it's not one of those we set up a JV and in 50 years, it makes money.

It's we actually bought a stake in a well-run company, which historically in India was more focused on essentially unconstrained fixed income and equity, which was already considered alternatives. And going forward, the focus is going to be much more on infrastructure. So India requires gigantic logistics investments, real estate, private credit and so on. And that will be, frankly, our contribution, meaning as Deutsche Bank Group, Deutsche is very strong in India. So our partnership will also extend to that alternatives business. I will be over for 3 days, middle of May.

So this is now -- I mean, we're currently waiting for regulatory approval. But this is something where we're quite bullish. There's nothing to believe that it shouldn't be one of the top 3 providers of alternatives in the medium to long run. And therefore, also a decent contributor to revenues, albeit probably starting in '27, not in '26. Private credit, this could be like a 1-hour conversation, but I will keep it brief. So I think what you currently see in terms of environment is sort of making the case for our approach, right? Our approach is European real economy lending as opposed to U.S. lending to financial sponsors.

Now momentum probably isn't great because private credit is in the press and many questions are being asked, but we feel that the thesis for our product has sort of been confirmed by the current discussions in the market. Progress a strong team is now complete. We brought in 2 more MDs in the course of Q1. So all of the senior folks are now complete across asset-based finance, direct lending solutions, but again, mostly focused on Europe so far. We are active fundraising. You know that in private credit, it only constitutes AUM and essentially fee paying once capital is deployed, which is why you don't see it yet. But I'm pleased with the progress in private credit.

The next question comes from the line of Pierre Chedeville, CIC.

Yes. I'll stick to one question because I have to move to the Amundi conference call. I read recently a report from the Boston Consulting Group saying that [ AI ] could reduce asset managers' cost globally from 25% to 35% within the next 5 years. And not only in terms of improvement in middle office or reporting tasks, but also in terms of better segmentation of customers, better distribution, et cetera. I don't know if you have read this report, but I wanted to know what do you think about this kind of improvement in the coming years?

Thank you, Pierre. Look, what's funny is whatever I say now in 6 months, we'll all look back and smile, right? Think about what we thought about -- how excited everyone was about ChatGPT 12 months ago, now this sort of outdated. So who knows? Now we are probably as excited as anyone else. I think overall, there's a significant difference between communicated progress and reality. So there's nothing that leads me to believe that we are ahead or behind any competitor, right? So everyone is looking at efficiency use cases. Everyone is looking essentially at the whole value chain and taking out or creating scale.

Just like everyone, we're experimenting on what it means for investment management in terms of like challenging PMs, not just summarizing what the Fed said yesterday. So I think we're probably as excited as anyone, but we're also really, really focused to making sure that it's scalable, that there's something proper to be done. We spent a couple of years in getting our data in order. We spent a couple of years in getting our processes in order because you don't want to automate or AI anything that's actually improperly set up. And now we see we are sort of ripe to properly leverage it. But I think it's too early to give you, unfortunately, to give you any specific indication of efficiency created by it in all honesty.

[Operator Instructions] The next question is from Jochen Schmitt from Metzler.

I have one follow-up question on the politically backed Deutschlandfonds. Do you see any concrete opportunities arising from this in the alternative asset space, say, with potential inflows over the next 12 to 18 months? That's my question.

Jochen, yes, I do, which I think would be the good answer. But to be more specific on one, and I'm just describing what we're currently actively fundraising without giving the specific update. There is one part which is called a first-of-a-kind fund, which is providing growth capital to German corporates that are essentially industry leader, right? So they are not start-ups, but more advanced and require growth capital. And we announced a few months ago that we are 1 of 3 asset managers selected to manage one of those KfW co-sponsored first-of-a-kind funds.

In that case, KfW is providing, I think it was also disclosed EUR 100 million of equity and debt. We aim to raise another EUR 400 million of equity and debt, and that is progressing very nicely. So that's one very specific aspect, which I think will translate into fees actually this year for this one specific component of the Deutschlandfonds, but there are a variety of other parts. So we are quite -- honestly, quite thankful for what the politicians have done and now it's on private capital to be raised. Last week, the CEO of KfW, Stefan Wintels, myself, we jointly ran a session for CIOs of major German or German-speaking insurance company CIOs. And there was a lot of interest in providing private capital to what KfW is sort of initiating.

There are no more questions at this time. I would now like to turn the conference back over to the moderator for the closing remarks.

Yes. Thank you very much, everybody, for listening in and for your good questions as usual. So please reach out to the IR team in case of any open questions that you might have. And otherwise, we wish you all a fantastic day and talk to you very soon. Bye-bye.

Thank you very much. Bye-bye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Ladies and gentlemen, welcome to DWS Q4 and Full Year 2025 Preliminary Results Investor and Analyst Conference Call and live webcast. I'm Lorenzo, the Chorus Call operator. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Oliver Flade. Please go ahead.

Yes. Thank you very much, Lorenzo, and good morning to everybody from Snowy Frankfurt. This is Oliver Flade from Investor Relations, and I would like to welcome everybody to our earnings call for the fourth quarter and full year of 2025.

Before we start, my usual reminder that the upcoming Deutsche Bank analyst call will outline the asset management segment results, which have a different parameter basis to the DWS results that we are presenting now. So I'm joined also as usual, Stefan Hoops, our CEO; and Markus Kobler, CFO. I'm pretty sure you have seen our notification yesterday evening and the material that we published this morning. So Stefan will start with some opening and some closing remarks, and Markus will take you through the main part of the presentation as usual. [Operator Instructions].

And I would also like to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. I therefore ask you to take note of the disclaimer and the precautionary warning on the forward-looking statements at the end of our materials.

And with that, I will now pass over to Stefan.

Good morning. So this happens when you have a live TV. My Head of Investor Relations just put me on mute. So let's start over. Good morning, ladies and gentlemen, and welcome to our Q4 and full year 2025 earnings call. Even though today marks not only the end of our 2025 financial year, but also of our 3-year strategic plan, we would like to spend most of our time looking forward at where we see DWS heading over the next 3 years.

But let me begin with a brief recap of our financial plan before handing over to Markus to walk you through the numbers in more detail. This is not intended as a victory lap. That is not our style. Rather, it is a fact-based assessment of what we delivered, what we learned and how that shapes our priorities for the next phase. When we announced our last 3-year plan in late 2022, the chips were not exactly stacked in our favor. We faced a difficult environment for asset managers alongside DWS-specific challenges requiring us to reduce costs, drive organic growth and address structural issues. As you've seen in our release, we exceeded our EPS target, reaching EUR 4.64, which represents an increase of 56% over the 3-year plan.

We also delivered well below our cost/income ratio target of 59%, even on a reported basis, increased the share of funds with more than EUR 1 billion in AUM and made tangible progress in building and scaling our digital business with the launch of our stablecoin joint venture and crypto ETPs. We closed the year with a strong Q4 with positive inflows across Active, Xtrackers and Alternatives as well as being positive across all regions and client types.

Since our Capital Markets Day in 2022, management actions across both costs and revenues have played a material role in our performance. We focused on structural measures that we took early, combined with disciplined planning and consistent execution. That approach allowed us to deliver through different market phases. As with every multiyear plan, some things turned out better than expected and others less so.

Clearly, the market provided helpful tailwind to the industry, while margin compression and inflationary pressures were tougher than we anticipated at our Capital Markets Day in 2022. While our organic growth has been solid, client demand skewed primarily towards Xtrackers with less momentum in active and alternatives developing below our original expectations. In terms of client progress, we feel good about our wholesale partnerships while recognizing there's still room to grow with institutional clients.

On costs, discipline has been strong overall. At the same time, we continue to see opportunities for further simplification, automation and efficiency gains across the organization. Compared to 3 years ago, DWS is now recognized for the right reasons, our market views, innovation and business relevance. But we continue to see strong upside potential in our brand awareness outside of Continental Europe. Look, I could go on with areas for improvement, but rest assured, we grade ourselves tougher than any of you would. The past 3 years have been hard work, but they have strengthened our execution credibility and give us the confidence to be bolder in our targets, which brings me to how we have designed our game plan for the next couple of years.

In Q4, also informed by feedback from you, analysts and shareholders, the Executive Board stepped back to reassess whether the financial targets we communicated 1 year ago still fully reflect the opportunity set for DWS today. This led to a comprehensive internal strategic review supported by a rigorous planning process focused on reassessing our priorities, challenging assumptions and allocating capital and resources to the areas with the highest return potential.

The outcome is a refined and more ambitious set of financial targets compared to what we communicated a year ago, reflecting both the progress we've made and confidence in what we can achieve going forward. Our new targets include an EPS growth of 10% to 15% per annum until 2028, a cost/income ratio below 55% by year 2027, performance fees in the range of 4% to 8% per annum and net flows of more than EUR 160 billion over 2026 to 2028. I will walk you through the thinking behind these targets in a moment.

But before that, I will hand over to my partner, Markus, for a closer look at the 2025 numbers.

Thank you, Stefan, and good morning, ladies and gentlemen. As Stefan already highlighted we clearly outperformed the financial targets we set for the full year 2025.

Let me briefly walk you through our key financial highlights. Our EPS increased to EUR 4.64, representing a year-on-year improvement of more than 40%. This reflects a combination of operating leverage from higher revenues and continued cost discipline across the organization. Total revenues increased to EUR 3,155 million, representing top line growth of 14% year-on-year. Driven by our disciplined cost management, our reported cost/income ratio improved to 58%.

Turning to flows. Our long-term net flows reached EUR 33.7 billion with total net flows of EUR 51 billion. This demonstrates our diversified product offering and our strong access to clients and distribution partners. Based on these strong results, we are proposing an ordinary dividend of EUR 3 per share, consistent with our dividend policy and reflecting our confidence in the sustainability of our earnings profile. Together, these results demonstrate that DWS can grow, improve efficiency and deliver attractive returns for both shareholders and clients.

Let's look at the financial performance snapshot for the full year. Total assets under management increased by 7% year-on-year to EUR 1.085 billion, mainly driven by long-term net flows as well as favorable markets. On the top right, revenues totaled EUR 3,155 million, representing a 14% increase versus 2024 and the highest level since IPO. The main drivers were higher performance fees and increased management fees as a result of higher average assets under management. Total costs remained flat year-over-year and totaled EUR 1,831 million, resulting in an improved reported cost/income ratio of 58% for the full year 2025. And as a consequence of operating leverage, we reported a 42% net income increase versus 2024, reaching EUR 928 million.

Moving to the financial performance snapshot for the fourth quarter of 2025. Starting at the top left, both total and long-term assets under management increased by 3% quarter-over-quarter, predominantly driven by net flows and market depreciation. Moving to the top right. Revenues increased to EUR 902 million, marking a 20% rise compared to Q3 2025. On the bottom left, costs amounted to EUR 486 million, up 12% quarter-on-quarter, resulting in an improved cost/income ratio of 53.9%. This marks an improvement of 3.8 percentage points quarter-over-quarter and 10.7 percentage points year-on-year. As a result, our net income reached EUR 296 million representing a 35% increase versus Q3 2025.

Let me now share some insights into the client dynamics during Q4. In Q4, the overall picture remained constructive, but client behavior remained cautious in the light of macroeconomic and political uncertainties. We were able to retain positive flow momentum across all client segments and regions, capturing client demand for risk management and diversified strategies. Overall, we reported net flows of EUR 10.5 billion and long-term net flows of EUR 8 billion, underscoring the enduring strength and resilience of our diversified product suite. Long-term retail flows stood out with EUR 6.9 billion of net flows marking the 12th consecutive quarter of positive flows. Germany was a key driver of retail success with flows skewed towards SQI as well as active equity. Long-term institutional flows were positive at EUR 1.1 billion, mainly focused on high-margin strategies, including infrastructure and LRA. As we move into the start of 2026, we continue to see clients reassessing allocations in the institutional space.

Looking at regions. Long-term net flows into our home market Germany amounted to EUR 4.2 billion, driven by an ongoing demand for Passive including Xtrackers. EMEA, excluding Germany, saw EUR 2 billion of long-term flows, demonstrating strong client engagement across the region as clients are increasingly receptive to European investment opportunities. The U.S. region recorded EUR 1.1 billion in long-term net flows. Client demand further shifted towards highly liquid, short-duration products especially in the U.S. fixed income. In APAC, the flow picture turned positive with EUR 0.8 billion in the fourth quarter.

Moving to the quarterly highlights within our Active business. The fourth quarter marks a positive turnaround in Active supported by SQI, where client demand remains structurally strong as well as a positive contribution from Active equity. Active assets under management stood at EUR 460 billion, up 1.5% quarter-on-quarter. We continue to report positive flows into SQI, our bright spot reporting EUR 0.9 billion in the fourth quarter with new product launches as well as retirement products being a key contributor. Active equity reported positive net flows of EUR 0.2 billion, mainly driven by retail.

Fixed income maintained its positive momentum and saw net inflows of EUR 0.2 billion, mainly driven by net flows into credit strategies as well as our top-selling DWS floating rate funds, which continue to attract strong inflows, partially offset by institutional outflows. Multi-asset also minor outflows, which were largely driven by a change in sales focus in certain distribution channels. However, the segment remains overall well positioned to deliver performance and support client demand. Product innovation continues to support the Active franchise. Recent launches include our Xtrackers floating rate notes Active usage ETF based on a proven and successful strategy.

Moving to our Xtrackers business. Passive, including Xtrackers a solid quarter and delivered net flows of EUR 6.6 billion, marking 12 consecutive quarter of positive flows. Assets under management increased to EUR 395 billion, up 5% quarter-on-quarter. The main flow contribute was our usage business which delivered net flows of EUR 6.1 billion. This was mainly driven by equity usage ETFs with good momentum in MSCI Emerging Markets, MSCI Japan and Euro Stocks 50. Our mandates and solutions business delivered EUR 1 billion in net flows driven by major mandate wins in Germany and Switzerland. These wins support the continued expansion of our Xtrackers institutional footprint and our core equity exposure.

Our U.S. domiciled ETFs saw outflows of EUR 0.6 billion in the fourth quarter, mainly driven by outflows in ForEx hedged ETFs. Xtrackers remains one of our core strategic growth pillars. As mentioned in previous quarters, our Xtrackers multiyear growth plan is focused on accelerating digital distribution, expanding our regional footprint and scaling our active ETF offerings. To support this, we have now 42 digital partnerships. While our initial focus was Germany, we are progressing -- we are progressively expanding across EMEA driving further expansion across key European markets. The contribution of these digital partnerships to our overall Xtrackers flows continues to increase.

Q4 concluded a year of innovation and significant activity for the Xtrackers platform with more than 100 product events across the UCITS and U.S. 1940 Act business. We further launched a partnership product in the Middle East region to address growing demand for Sharia-compliant investment solutions in the GCC region and Southeast Asia.

Let me turn to our Q4 highlights for our Alternatives platform. In Q4, our assets under management totaled EUR 108 billion remaining stable versus the previous quarter. Our Alternative business delivered overall net flows of EUR 0.3 billion in the quarter with infrastructure remaining the growth contributor within our Alternative platform, followed by liquid real assets. Infrastructure contributed EUR 0.8 billion of net flows largely supported by fundraising efforts across various strategies such as PEIF IV fund and our infrastructure debt strategies. They continue to generate positive momentum and position us for future growth.

We further continue to benefit from strong investor appetite for the European transformation. In liquid real assets, flows remained positive in the quarter, recording EUR 0.1 billion. We saw a momentum shift in client sentiment with increasing levels of renewed interest in core tailored strategies, particularly in listed real estate and infrastructure. The sentiment for real estate remains challenging. We reported outflows of EUR 0.9 billion in Q4 as traditional real estate strategies faced continued pressure this quarter. However, overall momentum continues to build slowly.

On the private credit side, our platform build-out is progressing steadily, benefiting from strong origination capacities with our Deutsche Bank partnership. DWS and Deutsche Bank recently signed a memorandum of understanding with Al Mirqab Capital, a Doha-based family office to launch a German opportunities mandate, underscoring continued interest in transformational investment themes.

Let me now move on to our Q4 revenue development. Total revenues reached EUR 902 million, marking a 20% increase quarter-on-quarter. Management fees increased by 3% quarter-on-quarter to EUR 673 million. This was largely due to higher average assets under management mainly driven by rising markets and net flows. Performance and transaction fees totaled EUR 173 million and include a substantial contribution from our flagship multi-asset fund concept Kaldemorgen, with EUR 93 million as well as the fee recognition from PEIF II with EUR 60 million. Other revenues amounted to EUR 56 million which reflect the EUR 24 million contribution from Harvest, EUR 22 million for net interest income and EUR 12 million from fair value of guarantees.

Let me move on to the contribution from our joint venture, Harvest Fund Management in China. For over 2 decades, we have owned a 30% stake in Harvest Fund Management, providing us with access to one of the world's fastest-growing asset management markets. Harvest strength at the -- as the sixth largest mutual fund company in China in 2025. In full year 2025, our stake in Harvest generated EUR 67 million of revenues, including EUR 24 million in Q4, which is a strong increase compared to prior quarters. This resulted mainly from a one-off tax item in the fourth quarter. At the end of 2025, Harvest assets under management stood at EUR 219 billion, up 2% year-on-year driven by positive flows into Passive equity funds and fixed income retail products. This was coupled with currency appreciation and partly offset by negative market performance.

Moving to our cost development in the fourth quarter. In Q4 2024, our cost/income ratio declined remarkably. This outcome once again underlines the disciplined way of managing our resources and our cost base at DWS, something which we are extremely proud of. In Q4, total cost stood at EUR 486 million being 12% up quarter-on-quarter, but almost unchanged year-over-year despite higher volume-based costs and ongoing investments. Compensation and benefits increased to EUR 248 million. It is important to stress that this figure should not be taken as the future run rate. It contains several nonrecurring items, including performance fee-related carry costs, share price-related effects and some severance expenses.

Excluding the Q4 specific items, our compensation and benefit costs are below both the previous quarter as well as Q4 2024. General and administrative expenses totaled EUR 238 million, up 9% quarter-on-quarter, but down 6% year-over-year. This reflects some seasonal adjustments, which typically occur in the fourth quarter. Active cost management means that in the light of positive revenue development in Q4, we took some measures, which triggered these additional costs.

As a result of these concerted efforts, our reported cost/income ratio improved by 10.7 percentage points versus Q4 2024, standing at 53.9%. Once again, this result demonstrates disciplined cost management alongside strong revenue growth. It gives us substantial capacity to invest in future growth initiatives while maintaining our profitability.

Let me now elaborate on our financial targets before handing back to Stefan. Let me briefly build on what Stefan already said regarding our refined financial targets and provide some context. After thoroughly reassessing our strategic priorities and challenging the key assumptions, we agreed to set ourselves even more ambitious financial targets in order to reflect the progress we have made over the past year and emphasize great confidence in our strategic direction, particularly in the areas where we see sustainable competitive advantages and attractive growth prospects.

Our intentionally ambitious targets until 2028 include an uplift in our EPS growth to 10% to 15% for the next 3 years, which is driven by 3 elements: disciplined cost management, improved operating leverage and a more dynamic revenue profile. Correspondingly, our cost/income ratio will improve over the next years. More precisely, we expect it to be below 55% by 2027.

For performance and transaction fees, we guided towards the upper end of 4% and 7% of total revenues in 2025. Going forward, we expect contribution to be between 4% and 8%. We maintained our target of at least EUR 160 billion cumulative long-term net flows over '26 to '28. As already communicated at Deutsche Bank's Investor Day in November 2025.

And finally, we will continue to manage capital in a shareholder-friendly manner, consistent with our disciplined approach to capital allocation and a payout ratio of around 65% for our ordinary dividend. As per our disclosure, we also updated you that our excess capital stands at around EUR 1 billion at the end of 2025. You might remember that you consistently reiterated that organic growth and M&A are an important part of our strategic agenda.

In addition, since the IPO, we said that we will give capital back to shareholders if we don't find adequate options to deploy our excess capital in a shareholder value-accretive way. Recognizing the excess capital position, we are committed to propose to use a substantial part of our excess capital for the payment of an extraordinary dividend in 2027, subject to capital commitment for organic and inorganic growth initiatives.

With that, let me hand over to Stefan to address the specific cost and growth priorities supporting our increased ambition.

Thank you, Markus. You've now seen our new financial targets. While our strategic direction remains unchanged, let me walk you through the logic behind these targets and the specific cost and growth priorities that underpin our increased ambition. Starting with costs. As discussed in previous quarters, we continue to distinguish between volume-based costs that grow with the business and discipline-based expenses. The measures I will outline are all designed to further reduce the disciplined cost base.

First, human capital management. While the term may sound technical, it reflects a simple reality in asset management. People are the key differentiator. Over the past few years, we have invested heavily in training and talent development, quadrupled our graduate intake, strengthened performance management and clarified functional roles. Internal mobility remains a core focus, and we will continue to invest to ensure that DWS is a place where the best people want to build their careers.

Going forward, the focus is on deploying talent more effectively, thereby rebalancing workload and aligning skills where they create the most value. This includes targeted senior restructurings and a disciplined approach to external hiring with limited replacement of levers. Together, these measures are designed to improve workforce cost efficiency while maintaining talent quality.

Second, target operating model adjustments. This sounds straightforward, but in practice, it really is. Every few years, organizations need to reassess whether structures remain fit for purpose. Regulatory requirements, client needs and technologies evolve, yet there's often inertia when it comes to updating org charts and value chains.

As part of our strategic review, we identified areas where simplification and consolidation are warranted. As in previous transformation phases, we intend to take the pain early with the bulk of these restructuring measures implemented by the end of Q1.

Third, IT and operations optimization. You may recall around 18 months ago, we updated you on our transformation program focused on areas that differentiate DWS as an asset manager. Since then, we've exited our own cloud migrated applications into Deutsche Bank's environment. And by doing so, freedom resources for automation and AI. In parallel, this work is accelerating further through operating initiatives, including the development of a nearshore hub in Spain, aimed at strengthening resilience and efficiency as teams refocus on higher-value automation-led work.

Turning to growth. What has worked well will continue. We will further invest in Xtrackers, build up our private credit capabilities and continue to scale infrastructure, why we'll deploy the capital already raised. In Active equities, we are encouraged by recent improvement in flows and we'll continue to prioritize this pumping heart of our company. There are a number of growth initiatives that cut across our franchise, asset classes and client types. Several are already embedded in our strategy, well advanced. And as these early investments are now bearing fruit, we are confident in raising our ambitions.

Gateway to Europe is one. We've invested here for some time and market sentiment towards Europe has clearly improved. Recent examples include the opening of our Abu Dhabi office in December, and a EUR 1 billion mandate from a Middle Eastern investor illustrating growing client engagement. With expanded alternatives capabilities and increasing engagement from sovereign wealth funds, we see tangible upside and will track progress transparently. Future of finance is another. We provided an update at the last quarterly call and the focus is now firmly on revenue generation, particularly across embedded investment solutions and digital assets. We will continue to provide updates and are assessing whether this should evolve into a dedicated business line.

Our ambition to be one of the top 5 foreign asset managers in the world's top 5 economies is gaining traction, both organically and through selective partnerships. The intended joint venture with Nippon Life India Asset Management that we announced at the end of last year is a platform in one of the fastest-growing asset management markets globally and supports growth across Active, Passive and Alternatives. This collaboration will build on a well-established franchise with strong local capabilities and will allow us to combine on-the-ground expertise with DWS' global reach. We remain constructive on China, and we are exploring selective partnerships in the U.S.

Germany remains our home market and a core pillar of the DWS franchise. Attracting strong interest from shareholders and analysts. As Germany's #1 asset manager by assets under management, we are well positioned to benefit from the current momentum and structural developments in our home market, driven by the ambitious reform packages of the German government. Even in our largest market, we see further growth opportunities across pension reform, infrastructure investments, subsidized scheme, collaboration with Deutsche Bank. We identified the partnership as a source of additional value creation at our 2022 Capital Markets Day, and the opportunity is now being addressed more clearly from both sides.

Being part of Deutsche Bank Group represents a significant competitive advantage for DWS, giving us access to origination and distribution capabilities that few asset managers can replicate at scale. The private bank is already our #1 distribution partner globally with further upside across joint product development and discretionary portfolio management. Beyond that, through collaboration with the Investment Bank and the Corporate Bank, we see significant additional opportunities to expand our offering to institutional and corporate clients, including comprehensive pension solutions across all pillars. Hopefully, this gives you a sense of what we've been working on for quite some time and why we felt encouraged to improve our financial targets.

Managing costs requires discipline and consistency. It is not always easy, but it typically delivers results relatively quickly. Sustainably growing revenues is more complex. It requires a rigorous assessment of opportunities, honesty about where we truly have an edge, disciplined resource allocation and then patience. Sales capabilities need to be built, investment platform scale and track records established over time. We have laid much of that groundwork over the past 3 years. This gives us increased confidence in our growth trajectory, translating into EPS growth of 10% to 15% per annum until 2028. Performance fees are expected to play a more prominent role with updated guidance of 4% to 8% and while operating leverage will drive the cost income ratio below 55% by 2027.

e will continue to manage capital in a shareholder-friendly manner, consistent with our disciplined approach to capital allocation. At DWS, we believe in being paranoid-optimist. Optimistic about the future, but uncompromising in execution. That means continuously challenging assumptions, learning from experience and staying focused on delivery. This is what you can expect from us, and it is the approach we will continue to take as we move into our next chapter.

With that, I will hand back to Oliver, and we look forward to your questions.

Thank you very much, Stefan. And operator, we're ready for Q&A now. If I just might remind everybody to limit yourself to the 2 most important questions that would be very kind. Thank you very much.

[Operator Instructions] The first question comes from the line of Hubert Lam from Bank of America.

Thanks for the new ambitious targets for the next few years. I guess the first question is on that. Can you maybe just discuss a little bit more on the EPS bridge from 2025 to get to your 10-plus percent EPS growth. '25 has obviously benefited a lot from performance fees and other revenues, which almost doubled year-on-year. Just wondering how sustainable this is? Or you probably need that to grow even further.

At the same time, you're seeing headwinds from fee margin pressure, but you've obviously done a very good job around the cost. So just wondering how we also should think about cost growth over the next few years. That's the first question.

Second question is on your Alternatives, particularly on the credit side. I just wanted an update in terms of your initiatives around there. And just to the product launches over the next year.

Hubert, thank you very much. So let me start on the EPS bridge. A couple of comments. So firstly, the jump-off point is the EUR 4.64. So I just want to clarify is the EPS achieved in 2025 that we suggest you use at least we use it as a jump-off point. .

Now then when it comes to the bridge the way we think about it, to get to at least 10%, and obviously, we want to get higher than 10%. I mean, otherwise, we wouldn't have increased the guidance. But at the baseline, look at 10% that would get you to at least EUR 5.10, which would be EUR 1,020 million of net income, which would translate roughly to EUR 1.46 billion of profit before tax.

I'm sure Markus -- and I'm sure you sensed his passion for capital discipline and cost discipline, we'll say something about cost. But honestly, we don't see costs going up from here, meaning the [ 18, 30 ] we had this year wouldn't expect this to be higher in '26. If you then assume that our other revenues are typically EUR 50 million a quarter, so 2025 was a bit higher than usual and you accept our guidance on performance fees of 4% to 8% and 2026 should be at the upper end, which would add EUR 260 million. It sort of requires us to generate EUR 2.83 billion of management fees, right?

So the bridge is sort of EUR 2.83 billion of management fees, EUR 2.60 billion performance fees, EUR 200 million of other revenues and then it's like flattish costs, that would get you to 10%. And again, obviously, we want to get higher and can speak about upside.

Now in order to get to that level of management fees, at 25 basis points would require roughly EUR 1.13 trillion of AUM. And then just for reference, the average AUM in 2025, was EUR 1,038 million, so EUR 1.38 trillion. So it need to be roughly EUR 100 billion higher in the average of 2026. Now we're currently at EUR 1.1 billion and whatever market you assume probably doesn't look too difficult to get to EUR 1,130 million on average. So your question will be around average margin, I would imagine. One thing to keep in mind is that PEIF IV which obviously is well known to all of you, will have essentially catch-up fees for those coming into the final close, which will be end of Q2. We currently stand at roughly EUR 2.5 billion when active fundraising, which is why I can go into any deeper, but want to get to EUR 4 billion to EUR 5 billion, so you can sort of kind of do the math of how much should come in, in Q1, Q2 and how much catch-up fees will help us keep the average margin stable in 2026.

But that's sort of what you have to believe, if you believe 10%. Now we see we have given with those growth priorities, a bunch of levers that we feel could lead to even more upside on AUM, therefore, management fees. But I would just leave it at that -- happy to take more questions on that Hubert or your colleagues, but that's how we look at the EPS bridge.

Markus looks eager to add something on cost.

I'm happy to do so. As a side remark, it's Stefan's birthday today. And besides famous Swiss soft drink, which I brought to him this morning, I also told him that he's allowed to answer all questions, but happy to step in. On the cost side, we expect to remain essentially flat in 2026. And there are a few reasons behind and Stefan has alluded to them all. We have added on a net base, about 260 FTEs in terms of our workforce, we expect to remain stable in the current year. We're also benefiting from investments which we have been taking in the past, which should help us on the productivity side. We have pretty much completed most of the remediation work, which is also freeing up resources and makes our processes more productive and robust. And lastly, we are also much better in terms of managing projects to stay within budget, within time and deliver the scope.

And so you have 2 counterbalancing effects. We have volume driven costs, which we see as good costs. We have also investments, which we increased in '26 compared to '25. But on the other hand, we also benefit from efficiency improvements. So costs remain flat or expect to remain essentially flat in 2026. So back to you, Stefan.

Hubert, coming back to your question on private credit, I would differentiate between capabilities, essentially the team and then fundraising. Team is now mostly complete. We'll have a senior person or Managing Director join us to run asset-based finance in mid-February. So that person is currently guarding leave. But then the team is complete. We are currently actively fundraising for direct lending fund, which is why I can't go into detail. We'll then raise money for an asset-based finance fund where we see good interest. In the last earnings call, I basically implied that there are a couple of specific large mandates we're working on.

You've seen one being announced, both Markus and I spoke about it from a Qatari investor. There are more such projects or larger mandates in the works. So we are quite optimistic on the capabilities of the team, but also on fundraising capabilities and fundraising progress to have like a meaningful impact in 2026 revenues.

Next question comes from the line of Nicholas Herman from Citi.

Can I just come back to the guide, please? I think 2026 is pretty clear. And as you said, given the strong markets that we saw last year, given catch-up fees, I think that's all pretty clear. I'm just trying to understand, I'd like to clarify the drivers for the growth outlook beyond '26 and kind of what is driving the uptick in growth outlook versus what you previously guided and whether it's revenues or costs. as part of that, can you clarify whether you're assuming similar levels of fee margin compression?

And I guess the reason I'm asking that is my interpretation is that the stronger growth outlook is maybe not due to management fees because the guided annual flows are relatively similar to the previous targets? And I guess, finally, does the guide include anything for your digital and crypto initiatives? And in which case, if it does, could you please quantify those?

Thank you, Nicholas. So the way I understood your question is what changed from when we communicated 10% EPS growth 12 months ago. So a couple of reasons why we felt ambitious. I mean, 12 months ago, the German government was not yet -- I mean, it was pre-election. And when you look at the progress, most of the things that happened in 2025 gives like a nice fiscal boost, which is nice for DAX, nice for corporates, but wasn't specific to asset managers.

Most of the things which they are now deciding or have already decided will directly translate into opportunities for us. I think the biggest one being the [indiscernible] reform that I think most of you have probably seen, which will come into effect in 2027. You will have the early start pensions. I mean, a variety of things on the pension side. You will have seen the announcement on the Deutschland fund.

So I guess the point I'm trying to make, Nicholas, much more bullish Germany and much more bullish the opportunity set. Most of that will be in 2027 and beyond. So many things happening this year. But for example, the pension reform will really kick in, in '27.

When it comes to DB partnership, again, a lot more optimistic now than 12 months ago. When you listen to my partners, Fabrizio and Claudio speak at the Deutsche Bank Investor Day back in November, all of them essentially gave themselves specific targets for collaboration with DWS which previously we simply didn't have, right? So before that, we were all friends, but it was essentially friendly engagement. And now there's much more accountability on both sides to deliver. So that's why we're more optimistic. I think the gateway to Europe, again, 12 months ago, it was like a neat idea. There was before Liberation Day, before euro strength and all of that.

So the gateway to Europe, which maybe 12 months ago was like nice idea into something nobody wanted to invest in, now seems to be much more investable. So we are more optimistic on that. I could continue, right? But you see that most of those growth levers, growth priorities we've spoken about before, had invested in before are now much more optimistic simply based on market circumstances, development, mandates won and so on. When it comes to the market outlook, we sort of remain constructive, but there are no heroic assumptions in our updated guidance, right? So this is if you will, alpha over beta. So we assume sort of constructive markets, but nothing compared to '25 or '24, right? We're obviously market appreciated significantly.

When it comes to margin, we do think that margin compression at DWS will be less than 1 basis point going forward, given the outlook on alternatives, right? I mean I think as all of us know and like we probably speak about more than any of you would, we feel that we've underperformed in alternatives capital raise over the last 3 years, which is something where we're more optimistic for the next couple of years, which is why we think margin compression will be less than that.

On your final point, like future of finance, that is something which I do think will contribute probably '27, '28 less so from digital assets and more in what we call embedded investment solutions, right? So that's essentially a fancy term for engaging with platforms in an embedded way or any other type of digital distribution channel.

One of the stats I had mentioned in the past is the percentage of Xtrackers sold through digital platforms, which, if you recall, was like 30% when I started talking about then was 1/3. It was almost 40% in Q4. So we feel that we're doing pretty well with those new brokers and platforms. And embedded investment solutions is essentially our technical build in order to be even more relevant to those important distribution partners. So that will start to contribute, but probably more '27, '28 than before.

That's very helpful, Stefan. If I could just follow up with that, please, just quickly. But I think everything that you said makes total sense to me. I guess, though, I look at that and say, on the growth outlook, but your guide for long-term flows is still about it's EUR 53 billion per annum. It was EUR 50 billion per annum.

So I don't really see that being translated in terms of the financial targets. And then the other thing I kind of noticed is that your guidance -- your assumptions on fee margin compression seem kind of fairly similar to before. But since you set the prior targets a couple of years back, One thing that has changed is we have seen an acceleration in active ETF growth.

And you've talked a couple of times about how active ETF fees are notably below your active fee margins. So why is it reasonable to assume a similar level of fee margin compression compared to the past?

Thank you. So flows first and then margin. So in flow, look, we have given the guidance of 10% to 15% I think if we want to get to 15%, flows need to be more than the EUR 160 million cumulatively over 3 years. That's the simple answer. I think there are plenty of reasons to be more optimistic. I mean, right now, pension reform in Germany could -- should be a significant driver of highly profitable inflows starting in '27.

So there are a bunch of levers of why we aim to outperform the target. But again, I think the EUR 160 million translates into the 10%, and then we would want to get higher in order to get to, well, the upper end of that range. When it comes to margin compression, I think a couple of things which make us optimistic. If you look in our presentation, the trajectory of equity of active equity flows, you will see that essentially every quarter, we improved over the last 6 quarters or so and finally had positive inflows in Q4.

Now Q4 has some seasonality. So I'm not saying that every quarter will now be positive, but you definitely see the trajectory which is why when you think about the sort of destructive contribution from active equity outflow on margin over the last couple of years, we feel that this is going to be less going forward.

We really like our inflows in SQI, which is above our average margin. So that's something that you see like drove EUR 4 billion of inflows last year. And then again, Alternatives didn't really contribute over the last couple of years and should contribute going forward. So our hope is that Xtrackers is going to continue outgrowing a growing market as they've done over the last 3 years. So that's obviously our aim and there's essentially some margin dilution because of that. But going forward, we think that the active high-margin products plus alternatives is going to counterbalance that.

Now as you rightly said, active ETF will have an average margin below active, but a margin higher than Xtrackers, so probably more -- or the typical Passive business. So therefore, that I would imagine having sort of a neutral impact on average margin overall.

Hopefully, Nicholas had clarified your question. But I suspect that your peers will have similar questions. So therefore, if any of that is unclear, please.

The next question comes from the line of Oliver Carruthers from Goldman Sachs.

Oliver Carruthers for Goldman Sachs. So Stefan, I know this was not intended as victory lap, but I think you're probably well within your rights to do so. You've grown revenues EUR 500 million over the last 2 years and held costs flat. So could you perhaps zoom out -- and this is really a backward-looking question, but can you give us a sense of over the last 2 or 3 years, where the key net cost savings have come from? Because you've -- as you've highlighted, you've been fighting asset-linked or volume-linked costs and inflation and investing for growth? So that's the first question.

And the second question really interesting to hear your remarks on the German pension reform. Can you really frame what the opportunity is here for DWS. Is it just that the average effective exposure of the German [ Sabre ] to equity is likely to rise given this reform and then you should be well placed to capture this? Or are there other components to this that we should be thinking about?

Oliver, I'm happy to start with the cost question first. And looking back over the last few years where we have been pretty stable at around EUR 1.8 billion. We have been disclosing the way we manage costs a few quarters ago, and then we see basically 3 different types of costs, which is about -- I mean, the 3 items are external costs, then volume-based costs and then the discipline based cost. The external costs have been pretty stable.

On the volume-based cost, they keep increasing with increasing assets under management, but also then the share price is going up. So that has, again, probably increased by a few percentage points. And that has been balanced by the discipline-based cost base.

And what has helped us over the last 3 years is in particular, what you quite often call below the line cost items. We have concluded with [ Proteus ] as a transformation project. So the transformation charges went to 0. We concluded with bigger investigations and have no further litigation costs at the moment. And we also hardly have any larger restructuring program. So severance costs remain very much in the low double digit. And so these items have been going down.

And then at the same time, we have also reduced quite significantly our external workforce, which have been -- which is one of the big driver in addition to banking services cost on the noncomp cost item. because we believe, again, the philosophy, it's not just cost driven, but given our workforce being the most important resources and appreciating asset for us, we prefer to have the know-how in-house.

So we have been replacing external workforce, and we keep doing that and have our own workforce, in particular, in near-shoring and smart shoring centers in India and the Philippines. And that's where you also bring them down cost because you no longer have the profit markup, you don't have VAT, but you can immediately compensate your own people properly. So that's basically behind it.

And the last one, again, even if we have been increasing our workforce, the workforce cost remains stable again for the same reason because we have not been hiring in hubs. We have brought in graduates and we're upgrading our own workforce.

And Oliver, just one thing to add on cost before I come to your question on pension reform. I think what you saw over the last couple of years was discipline and quite a few like tactical measures where we simply stopped doing certain things, optimize some things which could be done short term. I think the big levers that we have long term, those we invested in over the last couple of years, and you will only see going forward. Allow me to make one more comment on the human capital management also because just in a recent news article, it was basically summarized as hiring freeze.

Now what we had to do over the last couple of years was, first, quadruple graduate intake to make sure that we have enough smart young folks coming in. Secondly, we had to significantly expand our training curriculum and then announce that we have unlimited training budget for everyone at DWS. And thirdly, we had to map everyone from a functional role framework.

So everyone at DWS essentially has a corporate title, plus a description functionally of what they do, which you need if you really want to push internal mobility. So you need to understand why that person can do ABC, which is why they can also do DEF if you want to have internal mobility. Now these things took time, right? You cannot expand the graded program 4 times overnight. You have to essentially write the curriculum, hire more interns next year more graduates and so on, but that's -- we now have. So the reason why we're now saying, I don't think we need external folks. I mean, a lot of external folks, but we probably like our own talent more is because of all of those investments.

So when Markus and I look at our cost base, I want to stay flat at EUR 1,830 million . Markus always said he likes EUR 1,800 million more. But overall, it will be like flattish going forward. And that's why I think there's still a lot more room to essentially be disciplined on those discipline-based costs.

Now on pension reform, and I will keep it somewhat high level because just like I'm listening to all of our peers, they also listen to us. And I think we probably are slightly closer to the decision-makers in Berlin than some of our foreign competitors, which is why I probably wouldn't want to reveal everything we're working on. But when you look at the third pillar, what you previously had in Germany was called the Restart products, but I'm simplifying slightly, but it was essentially fully capital-guaranteed products which, therefore, were essentially pretty low risk, but also low yield. What has not changed is that you can have yield-oriented products without a capital guarantee which are yet still subsidized by the government, right?

So a big significant distinction to what we previously said, which was just announced a couple of weeks ago by the government. So higher risk yield-oriented, no guarantee, but still subsidized. So it's essentially a savings plan into attractive products for the retail investor, right?

I mean, folks in Germany similar to folks in the U.S. should be long-term investors in the equity market, and the government has clearly seen that. The consumer protection groups have pushed for that, and that is something which is going to be implemented by early 2027, which I think is going to be a significant opportunity for us to help our many distribution partners in Germany create such products, right? And if you look at research in the market, that should be like millions of new accounts.

Similar or additionally in the third pillar, you also have what's called the early start-up pension, where there's essentially a subsidized scheme for kids, right? And this basically rolls up out go into detail, but it's high level for kids below the age of 18 to start investing early, again, subsidized, there will be contributions possible from grandparents and so on. So also something which will essentially lead to a lot more savings plan like products in Germany.

Now when it comes to the second pillar, and that is something that they are currently working on, as you probably know, most of the German corporate pension funds are essentially pay as you go. So they're not funded like pension funds in the U.K. or in the U.S., but they're pay-as-you-go, which is not great for some pensioners, actually many pensioners. So there will also be changes, which I think will set incentives, but also potentially make it mandatory to fund some or all of your pension obligations.

And again, that should also lead to a lot of opportunities for somebody like DWS to assist those corporates in collaboration with Deutsche Bank's corporate bank that obviously have been covering those corporates forever. I mean I could go on, Oliver, but I think that sort of covers Pillar 2 and 3, where we see significant opportunities in the coming years. Thank you.

Our last question for today comes from the line of Pierre Chedeville from CIC Market Solutions.

One question regarding the development of net inflows. Maybe could you give us a little bit more color in terms of geography out of the EUR 160 million net inflows. What do you see in Asia, for instance, what is the amount in Asia or in U.S. How do you see things there?

And regarding retail versus institutional, I wanted to know what is your appraisal regarding risk aversion in the retail networks for individuals? Because, of course, you mentioned the plant in Germany in terms of defense, et cetera. But at the end of the day, we could see that the economic situation is not so fantastic. You have geopolitical risk, of course, things like that. And it seems that you're maybe a little bit optimistic regarding, in particular, the development in active equity. So I wanted you to elaborate a little bit more on that.

Thank you, Pierre. I probably would have hoped for easier questions on my birthday, but thank you. So look, the distribution across asset classes, client types and regions of the EUR 160 million, which again, I see as a minimum over the next 3 years. I probably wouldn't want to share, like I wouldn't want to specifically say how much we want to grow with insurance companies in Asia in 2028 in fixed income, but we have plans for that.

Big picture, the way I would look at it is that between 2/3 and 3 quarters will likely come from Xtrackers from Passive, which also implies that we will have significant contributions from Active and Alternatives over the next 3 years, right, if you look at the last couple of years, in some years, the total flows in Xtrackers were larger than overall flows, meaning the rest was sort of negative. We think that that's going to be between 1/4 and 1/3 of flows from other asset class and Xtrackers going forward. .

Regional distribution, I mean, Germany has been strong. Germany will stay strong. It was interesting to see contribution from U.S. equities, for example, in the fourth quarter, right? That was nice to see retail demand for active equity in the U.S. So the team there is doing a great job. Asia has been growing. And when you look at our various regions, then Asia percentage-wise has outgrown the other regions, albeit from a lower starting position. So I think overall, I would bet that Germany continues to be by far the largest contributor, but with growing contribution from Asia and EMEA. And then in the U.S., we're working really, really hard. So I would like that to also contribute.

Now I think your second question, can you just clarify, was it essentially whether I'm too optimistic on Germany or Active equity and equity outlook? Can you just clarify, Pierre?

No. Generally speaking, in terms of risk aversion for individuals, you mentioned in the last year -- in the past years that we could see a kind of risk aversion from individuals in retail networks. And when we listen to you, we have the feeling that your view is a little bit changing regarding this risk aversion sentiment. So I wanted to clarify that with you.

I got it. Okay. Well, I mean, I think DAX going up like 20% in '25 and looking really, really strong, especially for foreign investors, who also then benefited from the euro appreciation that probably helped sentiment in what we know very well, which is managing equities, but then specifically European or German equities. When you look at the performance of our funds, I mean, our flagship funds top dividend had a phenomenal 2025, right? It's like 14.7% return beating its key benchmark by like 7.5%. So therefore, I think that strong performance has helped. I think overall, the -- I think inflows going forward from equities for the pension products will really be long term in nature. So even if people are maybe short-term risk averse, if you contribute monthly for something that you will get in 30 years, then you probably don't care about timing as much.

So I guess what I would say, we are probably more constructive on the sentiment of retail investors than we were 3, 6 months ago based simply on market performance and the performance of our funds. Look, I think everyone is watching what's happening geopolitically. But so far, markets are holding up. I think our outlook probably in line with most competitors is for global growth to continue in 2026.

But again, I just want to be clear, when you look at our increased growth targets, this is really much more alpha driven than beta. So we do assume sort of constructive markets, but no heroic assumptions in our underlying plan.

We have a follow-up question from Hubert Lam from Bank of America.

Sorry, just one last question, given that we have time and nobody else has asked about it. I think you talked about possibly having a special dividend in 2027 with your surplus capital. I'm just wondering what does it mean for M&A? Is it less likely that M&A is going to happen, do you think, over the next year? And we've seen like recently seen deals within the space, particularly on the Alternative side. I'm just wondering what your thoughts are on M&A, at least in the near term?

Thank you, Hubert. So our incredibly gifted Investor Relations team is always prepping us and they had bet that M&A would be one of the first questions. So I'm glad it is being asked. So look, I think the way we thought about the potential for an extraordinary dividend is similar to 3 years ago in a sort of nonchalant way, we just wanted to communicate that, of course, we want to be as shareholder-friendly as we can with excess capital.

And similar to a couple of years ago, we just wanted to be clear, crisp, transparent in how we are thinking about it. So essentially, that is probably in line with what we -- how we've done 3 years ago. Now I think the possibility of us doing something organically -- sorry, inorganically is probably slightly higher than 3 years ago. So 3 years ago, I almost ruled out M&A because I said, look, there's so much we have to do, and I always felt that we just have to grow organically before you even deserve to think about doing something inorganically plus obviously, some of the overhang we had, some of the IT challenges we had. So therefore, it's probably slightly higher than then.

However, the way we think about M&A is sort of -- there's a pretty high threshold for us to even contemplate it simply because we feel that there's plenty of organic growth levers we have, when I could continue talking about our institutional business and so on, where I feel we can grow much more. So we want to be disciplined essentially with your money. But at the same time, management attention is something that we also need to be disciplined on.

Now the way we think about M&A is sort of 3 types: consolidation, product capabilities and access. I think when it comes to consolidation, we -- like all of our competitors, we now trade in line with the market, but we have a higher organic growth rate than most of our competitors. So just mathematically, it's not easy to consolidate without diluting the organic growth rate, right? So simply, if we are growing faster, but we trade in line, then unless we can buy somebody at a discount, it's going to be destructive for shareholders. That could change if markets become slightly wobbly with all the respect to all of you listening.

But right now, when you look at price earnings, you do not differentiate for cost/income ratio. right? So when you look at banks, banks with similar net income, but one being much less levered, that would trade higher. In Asset Management, there is no distinction between us having nice EPS growth at a cost/income ratio of sub-60% and competitors having a cost/income ratio in the 80s, right, which, again, I'm not an expert, but I don't comprehend because I think when it comes to the downside if markets became bubbly, we would benefit.

Others may struggle a bit more. But I think unless you have that kind of market environment, I do not see scope for big consolidation, which brings me to product capabilities. I think most things in alternatives, we would probably want to grow organically. Some are difficult to grow. I think value-add and real estate difficult to grow. So that's something we look at. And then something which I think is more and more differentiating is sort of client access in the institutional space being called OCIO in retail model capabilities. So essentially, that's something that clients more and more expect essentially as the interface of what they see and then all of the asset management is behind that. That's probably something difficult to build and something we would potentially look at inorganically. But in both cases, there's not a lot in the market.

And then finally, when it comes to access, we look at potentially increasing access to client types and potentially getting access to captive liabilities. I think captive liabilities, it's not that easy to buy an insurance company because of the accounting implications. But there, we look at a variety or a couple of things.

When it comes to access to clients, that's really just in Asia, what we're interested in. I mean you saw our joint venture in India, which is going to be a real acquisition, but with a purchase price in the double-digit million continues to be. We are incredibly mindful and disciplined on only doing things which would increase the earnings growth or be accretive to growth to shareholders, otherwise, we just return the capital. That's how we look at it.

We have a follow-up question from Nicholas Herman from Citi.

Like Hubert, I thought given the call was relatively short, I couldn't miss an opportunity for a follow-up. Just a question, just, I guess, conceptually, access to captive liabilities, is that -- would that -- could that occur and actually also be accretive to growth? Just curious there. And then the other one I wanted to ask was on flows. It looks like you have lost a bit of market share in passive versus your larger European competitor. Just curious if you could explain what drove that and if you have any visibility of that reverting at all anytime soon.

Thank you, Nicholas. Let me start with Xtrackers and then come back to the Captive liabilities. So we love the Xtrackers business, and the team is really good. What is true is that they had a strong Q1 and Q3 last year and mediocre Q4 and the weak Q2 right? The weak Q2 we spoke about when we spoke about Q2 results and explained what happened. But overall, that combination led to us growing slightly below our market share in 2025. I think most of that if you differentiate between low fee core products and higher fee value-add products, most of that market growth that we did not participate in, in '25 was the low fee core equity.

Now to be clear, this is not meant in a defensive way. We want to grow everywhere. But it wasn't really, let's say, revenue relevant to have lost that market share because, again, that was in very low fee core products. I think when it comes to value-add, we quite like what the team has done in ETF as a Service, launching 6 Active ETFs in '25. So we're now at 11, signing up new partnerships. We signed up -- signed off on a Xtracker expansion case. So that team is growing in Central Eastern Europe, in Italy, in Asia, in the U.K. So again, really trust in the team and that team will continue to outgrow a growing market.

When it comes to access to Captive liabilities, I probably almost violated my rule of M&A should be done and not talked about by kind of conceptually walking you through our thought process on consolidation, product capabilities and access. So I think I will probably leave it at that. But I mean, we're not going to buy a life insurance company for a variety of reasons. But there are potentially other things one can look at in -- so like the captive liability space.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Oliver Flade. Please go ahead.

Yes. Thank you very much, everybody, for listening in and with the good questions as usual, and please reach out to the IR team in case there are any open questions left. Otherwise, we wish you all a fantastic day, and talk to you soon. Bye-bye.

Thank you.

Bye, everybody.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your line. Goodbye.

Ladies and gentlemen, welcome to the DWS Group Q3 2025 Results with Investor and Analyst Conference Call. I'm Sergen, the Chorus Call operator. [Operator Instructions] And the conference being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Oliver Flade. Please go ahead.

Yes, operator, thank you very much, and good morning to everybody from Frankfurt. This is Oliver Flade from Investor Relations, and I would like to welcome everybody to our earnings call for the third quarter of 2025. So before we start, I would like to remind you as usual that the upcoming Deutsche Bank analyst call will outline the Asset Management segment's results, which have a different parameter basis to the DWS results that we're presenting now.

I'm joined, as usual, by Stefan Hoops, our CEO; and Markus Kobler, our CFO. Stefan will start with some opening remarks as well as the deep dive on digital developments, and Markus will take you through the main part of the presentation. For the Q&A afterwards, please could you limit yourself to the 2 most important questions, so that we can give as many people a chance to participate as possible.

And I would also like to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. I therefore ask you to take note of the disclaimer and the precautionary warning on forward-looking statements at the end of our materials. And with that, I will now pass on to Stefan.

Thank you, Oliver. Good morning, ladies and gentlemen, and welcome to our Q3 2025 earnings call. As this is the last quarterly update before concluding our 3-year plan, I hope you can see the progress we've made over the past quarters, not only in our strategic initiatives, but also clearly demonstrated in our numbers.

We said we would deliver on our long-term financial targets, and we are now on the final sprint to the finish. At the same time, we continue to invest for the long term, something you will see reflected in today's digital deep dive. But before we get to that, let me start with the numbers.

Our earnings per share came in at EUR 1.10 this quarter. Assuming a similar EPS in Q4, we will get to an EPS in the EUR 4.20s by year-end, exactly in line with our bridge from last quarter. On top of that, the seasonal performance fees from our flagship fund, Concept Kaldemorgen are expected to contribute meaningfully in Q4. With this seasonal uplift still to come, we have a clear path towards our EUR 4.50 EPS target.

Turning to the highlights from the quarter. Long-term net flows were EUR 10.3 billion, reflecting a solid quarter and continued investor confidence. Reported revenues came in at EUR 754 million, up 10% year-on-year and 1% quarter-on-quarter. Net income rose to EUR 219 million, an increase of 30% year-on-year and 2% quarter-on-quarter. Our cost/income ratio improved to 57.7%, a reduction of 6.6 percentage points year-on-year and 1.5 percentage points quarter-on-quarter.

We also marked an important milestone with receiving the necessary licenses to open our new office in Abu Dhabi. Strengthening our regional presence and client engagement in the Middle East reinforces our position as the preferred gateway to Europe for global investors.

With that, I will hand over to Markus, who will take you through the details of our financial performance.

Thank you, Stefan, and good morning, ladies and gentlemen. Let me start by saying that we delivered an improvement across all, and I would like to reiterate all key financials in the third quarter, which is something we are very proud of. Starting at the top left, long-term assets under management totaled EUR 935 billion, up 5% quarter-on-quarter, predominantly driven by net flows and market appreciation. Total assets under management stood at EUR 1.54 trillion, which is a 4% increase quarter-on-quarter.

Moving to the top right, revenues increased to EUR 754 million, a slight increase from Q2 and 10% higher compared to the third quarter of 2024. On the bottom left, costs amounted to EUR 435 million, down 2% quarter-on-quarter. Thanks to our active cost management approach, the cost/income ratio improved to 57.7%, down 1.5 percentage points quarter-on-quarter and 6.6 percentage points year-on-year. As a consequence of operating leverage, we report a 30% net income increase versus Q3 2024, reaching EUR 219 million. This was achieved despite a higher tax rate this quarter, reflecting the remeasurement of deferred tax assets following Germany's corporate tax reform starting in 2028.

Let me now share some insights into the client dynamics during Q3. In Q3, we saw strong business momentum with clients increasing their market exposure to more liquid offerings, while remaining cautious overall. This shift reflects confidence in our product range and adaptability to market conditions. Overall, we reported net flows of EUR 12.1 billion and long-term net flows of EUR 10.3 billion, underscoring the enduring strength and resilience of our diversified product suite. We were able to retain positive flow momentum across all client segments, capturing our clients' demand for risk management and diversified strategies. Long-term retail flows stood out with EUR 9.3 billion of net flows, marking the 11th consecutive quarter of positive flows.

We also saw growing demand for discretionary portfolio mandate solutions and ongoing industry transformation and high market volatility. Long-term institutional flows were positive at EUR 1 billion, mainly focused on high-margin strategies, including infrastructure and LRA. These were partially offset by 2 large one-off redemptions. Key themes for investors are cost efficiency, customization and capturing illiquidity premiums in times of decreasing rates.

Furthermore, we achieved positive long-term net flows across all regions, except APAC, reflecting the strength of our global franchise. In APAC, the flow picture was impacted by one client's corporate decision to in-source their investment capabilities. EMEA, including Germany, accounted for more than EUR 10 billion of long-term flows, demonstrating strong client engagement across the region as clients are increasingly receptive to European investment opportunities. The U.S. region recorded EUR 0.3 billion in long-term net flows. Client demand further shifted towards highly liquid, short-duration products, especially in U.S. fixed income.

Moving to the quarterly highlights within our active business. In the third quarter, our active assets under management stood at EUR 453 billion, a 2% increase quarter-on-quarter, primarily driven by positive market impact, particularly within active equity and fixed income. While the flow picture in active remains challenging, it has been a quarter of gradual improvement with EUR 0.3 billion in net outflows, which outlines encouraging underlying momentum, particularly in fixed income.

We continue to record positive flows into SQI, our bright spot with EUR 1.5 billion in the third quarter and almost doubling net flows year-to-date to EUR 3 billion with retirement products being a key contributor. Fixed income returned to positive net flows of EUR 0.2 billion, mainly driven by significant mandate top-ups as well as our top-selling DWS floating rate funds, which continue to attract strong inflows. We further see increasing positive momentum into credit funds.

Although our equity business reported outflows of EUR 0.6 billion, momentum for active equity is improving, especially in Germany. Style and thematic equity funds such as DWS Invest Artificial Intelligence and DWS Invest Critical Technologies continue to see steady inflows. Multi-asset saw outflows, which were largely driven by 2 large low-margin redemptions. Excluding these effects, the flow picture for the broader multi-asset platform remains stable.

We grew our newly launched active ETF offering, which continues to gain traction with clients, reflecting the clients' confidence in our approach. This demonstrates our ability to innovate and bridge our active and passive capabilities, an area where we see significant long-term growth potential. We further plan to launch the Xtrackers floating rate notes active Usage ETF in Q4 2025.

Moving now to our Xtrackers business. After a challenging second quarter, our Xtrackers business has regained strong flow momentum, reaffirming its position as our key flow contributor. Our Xtrackers business delivered net flows of EUR 10.3 billion, marking the 11th consecutive quarter of positive flows. Assets under management increased to EUR 376 billion, up 9% quarter-on-quarter. The main flow contributor was our UCITS business, which delivered net flows of EUR 9.4 billion. This was mainly driven by equity ETFs, especially by our top seller Xtrackers MSCI World Financials.

Our mandates and solutions business delivered EUR 0.8 billion in net flows, driven by a mandate win in Germany as well as continued flows into our scalable MSCI AC World Xtrackers usage ETF. Our U.S. retail funds, also known as U.S. 1940 Act saw net flows of EUR 0.2 billion in the third quarter, maintaining its positive trajectory. Our focus campaign, think outside the U.S. box concluded successfully, and our U.S. platform surpassed USD 29 billion in AUM for the first time ever.

Overall, we are confident in our strategic development and our flow momentum has returned after a challenging Q2. As Stefan mentioned in previous quarters, our multiyear growth plan is focused on accelerating digital distribution, expanding our regional footprint and scaling our active offering marks a key milestone in Xtrackers growth journey. As an example, in Q3, we expanded our strategic footprint through 2 new digital distribution partnerships in Switzerland and Sweden, driving further expansion across key European markets.

Let me turn to our Q3 highlights for our alternatives platform. In Q3, our assets under management totaled EUR 107 billion, remaining stable versus the previous quarter. Our alternative business delivered overall net flows of EUR 0.3 billion in the quarter, with infrastructure remaining the growth contributor within our alternative platform, followed by liquid real assets. Infrastructure contributed EUR 0.4 billion of net flows, largely supported by fundraising efforts across various strategies such as our P4 fund and our infrastructure debt strategies.

They continue to generate positive momentum and position us for future growth. We further continue to benefit from strong investor appetite for the European transformation. In liquid real assets, flows remained positive in the quarter, recording EUR 0.3 billion. We saw a momentum shift in client sentiment with increasing levels of renewed interest in core tailored strategies, particularly in listed real estate and infrastructure.

The sentiment for real estate remains challenging. We report outflows of EUR 0.6 billion in Q3 as traditional real estate strategies faced continued pressure this quarter. Throughout the third quarter, we built on strategic initiatives, focusing on expansion in real estate debt and launched our second vintage property debt strategy in Europe.

Our private credit platform build-out is progressing steadily. During the third quarter, we finalized a number of key hires that strengthen our capabilities, ensuring we have the right expertise in place. In parallel, we have kicked off a series of roadshow activities to engage directly with investors and showcase our differentiated approach.

Let me now move to our revenue development. Total revenues increased slightly quarter-on-quarter at EUR 754 million and marked a 10% increase year-on-year. Management fees increased by 4% quarter-on-quarter to EUR 655 million. This was largely due to higher average assets under management, mainly coming from active and passive businesses. Performance and transaction fees totaled EUR 50 million, down 14% versus Q2, mainly due to lower contributions from real estate performance fees, partly offset by increased transaction fees in EMEA real estate.

As Stefan already mentioned, performance fees from our -- from one of our flagship multi-asset funds, Concept Kaldemorgen are expected to contribute substantially during the fourth quarter, currently standing at the high double-digit euro number. Other revenues amounted to EUR 48 million, which reflects a decrease in our fair value of guarantees and include EUR 21 million from net interest income and a EUR 16 million contribution from Harvest.

Moving to our cost development. I am very proud of the proactive and disciplined way of managing our resources and our cost base at DWS. And the Q3 outcome is another testament to that. In this quarter, total costs declined by 2% quarter-on-quarter to EUR 435 million despite higher volume-based costs and ongoing investments. It keeps us on track for essentially flat costs in full year 2025. Compensation and benefit expenses were managed prudently, reflecting a 2% decrease from the previous quarter, primarily due to lower retention-related expenses.

General and administrative expenses also went down slightly and stood at EUR 218 million despite rising AUM in Q3. As a result of these concerted efforts, our reported cost/income ratio improved by 1.5 percentage points versus the prior quarter, now standing at 57.7%, being significantly below our full year 2025 guidance of less than 61.5%. Again, this outcome reflects disciplined cost management, while driving revenue growth. It provides us with meaningful capacity to invest into future growth initiatives without compromising our profitability. Handing now over to Stefan for a deep dive on our digital strategy.

Thank you, Markus. Now let's take a step back from the quarterly numbers and talk about how we are positioning DWS for the decades ahead by building the digital foundations for the future of finance. When you do a deep dive on digital, you always run the risk of sounding too abstract or heavy on buzzwords. So let me start by underlining that our build category is not about hype, it is about disciplined execution like everything else we do.

At our Capital Markets Day in 2022, we introduced our digital priorities and set specific milestones. We brought in the right caliber of talent to drive this transformation, most notably Rafael Otero, who joined us to oversee technology and operations. Rafael is deep experience in payments and fintech has been instrumental in building our digital foundation. 3 years later, we have been delivering on our plan as promised.

I will touch on a few of the specific initiatives that we are currently working on in just a moment. Our focus now lies on scaling 3 key areas: embedded investment solutions, digital assets and artificial intelligence. We believe these are the digital developments with the greatest potential to redefine asset management and drive shareholder returns.

Allow me to share an analogy that captures how we think about the future of finance. Think about your house or your apartment. You have electrical installations to ensure your lights turn on. There's a good chance that the main electric wiring was built long before you moved in and will stay in place for many years to come. We like to think of embedded investment solutions as the electric wiring of your home. The connections that keep everything running. At DWS, these are the digital links that let our partners connect directly into our products and integrate them seamlessly into their own platforms.

You simply expect those wires to work and you wouldn't replace them unless you absolutely had to. Now every once in a while, a new material or standard is invented like smart grids or renewable energy systems, transforming how the infrastructure works. That is how we see digital assets, a new way of representing asset ownership with currencies, stocks, bonds and funds moving on to blockchain. And like any new standard, success depends on trust and scale, scale to produce at volume and trust, bid on credibility, regulation and the confidence that investors assets are secure.

And finally, you have what flows through those wires, the energy or signals that make everything function. This is how we see artificial intelligence. As the intelligence shaping and optimizing what flows through the system. AI can transform how we operate, enhancing alpha generation, improving efficiency and reducing the cost to produce. This layer evolves quickly, and AI is attracting substantial excitement right now.

Nevertheless, at DWS, we are focused on generating sticky recurring revenues and annuities represented by the wiring underneath the infrastructure and trust layers, which stay the same. And that is why we are focused on building those foundations through embedded investment solutions and digital assets, while using AI to enhance and transform the products flowing through them.

Let's take a closer look at each. Let's start with embedded Investment Solutions. Digital channels are becoming the dominant gateway for investors. We see the shift clearly at DWS with around 1/3 of Xtrackers AUM coming from digital platforms. This brings both opportunity and challenge as products become more embedded. Product providers risk turning into a commodity, while platforms on the client interface.

You first heard us talk about this concept during our Q2 call last year, using the example of how Amazon or PayPal use embedded payment services of Deutsche Bank without the end clients noticing. We described this as operating in a little B2B2C environment with the first B being the little or less relevant B. The same shift is happening in asset management.

Investors will still want exposure to U.S. stocks to German mid-caps, but how they get that exposure may soon become the commodity. At the same time, customers expect hyperpersonalized investment solutions that need to be integrated into their daily lives whenever they need it. That is where embedded investment solutions come in. They are the invisible infrastructure that powers investment platforms and digital channels behind the scenes. Our goal is for DWS to provide the trusted, indispensable IT infrastructure that connects investors seamlessly to products and capabilities wherever they invest.

We've already made strong progress in building an IT platform that integrates our investment intelligence directly into client systems. Our first APIs are live, and we have onboarded our inaugural client, who is leveraging the platform to deliver individualized asset management solutions. Additional clients are already in the pipeline.

Looking ahead, our focus for the next years is on scaling quickly and building a true platform business. For that, we are currently focusing on further developing our IT platform to deploy additional DWS capabilities as a service. Moreover, we aim to establish a partner ecosystem that allows us to offer investment solutions in the modular and flexible way, adapting to client needs across different channels. All of this contributes to our long-term vision to embed our investment expertise seamlessly into both individual and institutional investor portfolios.

Let's move to digital assets, where we have already translated a challenging vision into tangible progress. Over the past 3 years, DWS has established a Swiss-domiciled ETC platform offering physically backed Bitcoin and Ethereum ETCs that give investors secure and convenient access to crypto markets. And when it comes to stable coins, I guess, when we first spoke about this at the Capital Markets Day in 2022, it must have sounded like a pretty bold vision to you. As we are quite early with this topic. Today, we are proud to say we delivered on it. All Unity, our joint venture with Galaxy Digital and Flow Traders launched EURAU, the first fully regulated euro-denominated stable coin out of Germany.

The joint venture stands for expertise in blockchain technology and asset management credibility. And these achievements position DWS at the forefront of digital finance in Europe, combining blockchain innovation with the trust and governance of global asset manager. Looking ahead, our focus is on scaling and diversification. Within the next 18 months, we plan to broaden our crypto offering with a diversified crypto basket of leading digital currencies.

In parallel, we will develop complementary products and services around AllUnity's Euro stablecoin. Once Agentic payments and machine-to-machine transactions become the norm. We want to be the backbone and enabler of that ecosystem, connecting traditional finance with the unchained economy.

Finally, we are preparing to tokenize our first fund with discussions already well advanced with potential partners. Ultimately, our goal at DWS remains to become the trusted tokenizer, the party aiming to ensure each token truly represents what it claims to. When people talk about democratizing alternatives through tokenization, they rarely think about how to ensure the token they buy actually represents what they think they are buying. Tokenization of real-world assets is not easy. While several companies can handle the technology, a few can actually bring real assets on chain in a way that unites technology with legal, compliance and regulatory expertise, while ensuring investor protection.

That is where DWS has an edge. As a fiduciary asset manager, we combine precisely those capabilities, positioning us as the credibility layer of digital finance and the bridge between real-world assets and the digital economy.

Finally, let's turn to artificial intelligence, which optimizes the way the system functions. For us, AI provides the potential to enhance the way we work to deepen investment intelligence, make our products more efficient and effective and ultimately improve client experience. Like many peers, we are testing and experimenting broadly. Our teams are using AI productivity tools, and we're engaging with our Chinese joint venture, Harvest Fund Management, where the use of AI in asset management is already well advanced.

We are in close touch with leading players across the field. And so far, most of what we see at DWS and across the industry has been in efficiency gains rather than alpha generation. But we believe this to be the necessary first step in building long-term capabilities.

Over the next 2 to 3 years, we will focus on creating a data platform with integrated AI capabilities and launching an AI companion that supports and challenges portfolio managers in their daily decision-making based on trained and observed behaviors. When it comes to our long-term ambition around AI, we are distinct from many others in the market. We are less focused on a probability driven what is the most likely answer. Instead, we're doing the exact opposite, not most likely answer, but rather what is the question or perspective that no one has thought of before.

As such, we are not competing with the tech industry to build AI models. That is the domain of tech giants. We are focused on tapping into that new technology to elevate what DWS does best. Disciplined, inside-driven asset management. Our REIT advantage comes from decades of proprietary investment data, the cumulative decisions of nearly 1,000 portfolio managers across asset classes, market cycles and regions.

By combining that knowledge with machine learning and generative AI, we hope to scale human insights and connect the dots others may miss. Our best portfolio managers are the ones who asked the questions that have not yet been asked. Imagine a proprietary AI model that challenges conventional thinking in markets, as sort of digital and Klaus Kaldemorgen on steroids. We see this as a true opportunity of AI and asset management, human plus machine collaboration, not replacing judgment, but sharpening it.

In the long run, we believe AI will be a key enabler of alpha, asset growth and cost efficiency, helping DWS stay at the forefront of intelligent investing. Hopefully, this gives you a clear picture of our overall vision for digital channels, digital assets and AI. Together, these initiatives are differentiating DWS and embedding us more deeply into the digital architecture of our clients and the overall financial systems. They are building lasting value that will sustain DWS well beyond this strategic cycle.

So to wrap-up. In the big scheme of things, the 2025 earnings per share target may appear to be just a milestone. However, for us, as a management team, it is paramount to deliver the EUR 4.50 that we promised you. We are confident we will reach our full year targets and are well positioned to deliver 10% EPS growth in both 2026 and 2027.

Hopefully, today's update has provided confidence not only in our ability to meet our short-term goals, but also in the investments we are making to secure our long-term growth. We're now concluding our sprint to the finish executing with the same discipline and consistency that you expect from us. And now handing over to Oliver for Q&A. Thank you.

Thank you very much, Stefan. And operator, we're ready for Q&A now. And if I may, just remind everybody to limit yourself to the 2 most important questions, that would be very kind. Thank you very much.

[Operator Instructions] And we have the first question coming from Hubert Lam from Bank of America.

I've got 2 of them. Firstly, Stefan, thank you very much for the overview on digital and AI. Can you tell us how much investments are you putting into them across all 3 pillars? And also talk about the time line for these initiatives start paying off in terms of revenues, particularly around the digital assets and the business solutions side of things.

Second question is on P4. I was wondering if you can give us a further update on it, in terms of when you expect it to close? Should we expect that later on this year or Q4 or next year. It seems like also you had some inflows into it in the quarter. So just wondering where AUM is -- or commitments are in that fund today, and what your target is for the fund. I think the last time we checked it was between like $4 billion to $5 billion. I just wanted to confirm these numbers.

Hubert, thank you. I want to actually take both starting with P4 because that's probably the shorter and easier one. So firstly, we do not need any fundraising of P4 to reach our EUR 4.50 EPS. So that we'll get to just with run rate plus consequence of Concept Kaldemorgen. Now our ambition to get to EUR 4 billion to EUR 5 billion, that remains intact.

The question is simply how many investors will come in this year? And how many will wait for the final close, which is Q2 2026? What we currently see in these types of large private equity funds is that there's a very barbelled way of investors coming in. They come in very early to get discounts or at final close, and there's very little upside to coming in between. So what seems to be the case right now is that people observe how we're investing. We just signed a couple of other investments for P4.

Just seeing portfolio, seeing what we do and then potentially come in for the final close. So therefore, we're still fully committed, fully confident in reaching the EUR 4 billion to EUR 5 billion overall. How much of that comes in Q4 versus Q2 next year remains to be seen. And I think everyone remembers that there's going to be a big catch-up management fees, like dating back to August 2024 when that flow comes in.

Now the first question, which I think is a pretty broad question. And also for like all of you smart folks out there, we would love to get your feedback and see what questions you ask. So if you follow-up with Investor Relations on those 3 themes. So embedded investment solutions, digital assets and AI, I would actually personally try to join as many meetings as possible and bring some of the experts because, again, we'd love the challenge. And I want to see what questions you're asking, there's going to be some sort of price for the best smartest questions at dinner in Berlin, where many of the smart folks at.

Now a question on investments and time lines. So how we invest in those 3 is actually quite different. So embedded Investment Solutions is our own folks in sitting in IT mostly. So we have a team of like 2 dozen, a little bit more, it's like close to 30 really smart people mostly sitting in Berlin and London that are working on that. They are folks that have been working in API work for most of their lives, not that many actually have asset management experience, many of them is like fintech background.

But those are people coding, working on DWS payroll. The investment isn't that significant. I mean it's smart people coding, but it's not that we are buying massive licenses. It's really an API platform with intention to then deliver our own services, but I think that's relevant, also in-source services delivered by others, which we will then bundle and deliver to our clients.

For digital assets, the investments are mostly through AllUnity. So in that case, it's basically an equity investment, which, to some extent, translates into human labor and cost at the level of AllUnity. But therefore, that you wouldn't see currently in our cost base, but it would be an equity investment. Obviously, we have plenty of people at DWS sort of contributing to that, but the full-time employees sit with AllUnity.

AI is again different. So there, obviously, we have a few people in tech and data, when I say a few, it's actually like a mid- to high double-digit number of people that are fully dedicated to that. But then that's obviously tooling for everyone at DWS. So most of our folks have access to AI tools and there's obviously licensing costs and so on.

So therefore, for AI, I think we can maybe quantify it at the next earnings call. It's not gigantic, but it's a combination of license costs and then some dedicated folks, but then everyone sort of contributing a percentage of their time to AI. When it comes to time line, I mean, some of those milestones are quite specific. So for digital assets, we said what we do in the next 18 months. For embedded investment solutions, we are pretty much live. I mean it will continuously be improved. There will be more services being added, but we have our first client. So the first revenues will come in. AI like remains to be seen, right? There will be efficiency gains, but for that to be contributing to revenues, it may take some time.

Overall, I think it's difficult to see how -- difficult to anticipate, I don't want to start speculating, how meaningfully that will contribute to revenues and by 1 when? And I think the way that we think about it, and again, happy to take any and all questions on it, is what is the total addressable market for the respective area? What will the future market structure look like? So is it going to be an oligopoly? Will there be many players and so on?

And then third, what does it take to win? And therefore, can we win? I think for embedded investment solutions, the total addressable market is gigantic, but I mean, you can debate how big, but I think it's platforms source products through these APIs, it could be a lot of service like sticky fees, sticky revenues, service fees come in.

I think for payments for stable coin, I mean, who knows what the total addressable market could be, right? It could be in gigantic. For tokenization, which I think is a key feature that so much hasn't attracted a lot of attention really across the industry. What are the revenues generated by custodians, by clearing houses, by exchanges and so on, which I think could all be disrupted once ownership is represented on blockchain. So gigantic total addressable market.

I think we could continue, but I mean, I think that's what we would love to discuss with you how you see that. I think most of those will be oligopolistic market structures, where those that come in early have a better chance of success, and that's why we're so fully focused on it. I think, it should work.

The next question comes from Jacques-henri Gaulard from Kepler Cheuvreux.

Congrats for the results today. Well done. 2 questions, I guess, you replied to it, Stefan already. Your parent company is going to have an Investor Day on the 18th of November. Are you going to issue a press release or anything like that to renew and reiterate what you just reiterate or maybe add new target in that context or no need. And basically, we have the game plan, and it continues as it is.

And maybe the second question as well on your deep dive, which was indeed very interesting. You just mentioned that you had already some clients in the Embedded Investment Solutions. So what type of profile do you get in the type of clients? And are you actively pitching for partners in that area and maybe a little bit, if you can give us even a little bit more color of the tangibility of that?

Thank you, Jacques-Henri. I think, I will again take both. So the Deutsche Bank Investor Day is on November 17, and I will actually present the asset management segment. We will not have new targets. I mean Deutsche Bank is likely going to have potentially until 2028. And then we may have to like add the year '28, but our current financial targets of 10% EPS growth in each of '26 and '27 from the jump-off point of this year's EPS that remains intact and I don't see that changing or any additional targets being added.

Now on Embedded Investment Solutions, the inaugural client is a wealth retail bank, private bank that offers digital solutions and will simply in-source asset management capabilities through our individualized asset management API platform. I think most of the clients initially will be these platforms, neo brokers, private banks that all have digitally savvy consumer clients, end clients, retail clients and need to deliver as management services at scale. I think over time, I would expect institutional investors to also be much more interested.

Think about the pension plan, right? Think about a corporate that wants to provide like Pillar 2 solutions to their clients, you could see how they will just quite like seamlessly in-source those capabilities through an API platform in order to deliver to their employees. So I think over time, most of the, let's say, interaction between us and clients, I would expect to happen more and more digitally through this type of platform.

Now and again, happy to discuss in more detail as a follow-up. But the way you should think about it is there is a platform that integrates all of the capabilities that can be sourced internal. So obviously, a bunch of things we produce, but can also be insourced from other asset managers. That is then integrated into what we show to our -- to our end clients. So will then essentially be a -- well, a client-facing layer. And that could be scaling quite interestingly. But again, that's something that's going to play out over the next couple of years.

The next question comes from Angeliki Bairaktari from JPMorgan.

Just 2 from me as well, please, on alternatives, both of them. So first of all, there was an announcement a month or so ago that Deutsche Bank is partnering with Partners Group and DWS for the launch of Eltif. And I was just wondering, if you can give us a little bit more color with regards to DWS' role in these initiatives. And also why, in your opinion, Deutsche Bank is not just going directly to you, their in-house asset manager and requires a third-party and to launch these Eltif to their private banking clients.

And second question with regards to private credit, you mentioned in your presentation that you are hiring a few people there. Shall we expect to see some inflows already from private credit origination in cooperation with Deutsche Bank in 2026. And perhaps a comment more broadly, I mean, we've obviously seen private credit managers being put much more in the spotlight over the past couple of months with some defaults in the U.S. What is your view with regards to sort of the risk reward at the moment in the market, when it comes to direct lending and origination?

Thank you, Angeliki. I guess it's probably a good sign that there are not a lot of tough questions for our CFO, who's relaxing. So the next question should also be addressed. So on the Eltif, it's essentially teamwork between Deutsche's Private Bank Partners Group on us in which we are -- essentially, we are the one servicing the AFM. So we are the one setting it up, managing the Eltif, but then the capabilities on private markets Partners Group is providing.

Now we have to be honest, right? I mean, Partners Group is a formidable long-storied alternative asset management firm out of Europe with great knowledge in private equity, in private credit and so on. We simply do not have private equity or VC capabilities. So if you choose somebody who is then managing a sort of fund of fund of a variety of strategies, frankly, partners who simply has broader capabilities than DWS, right?

So it was a very amicable, well collaborative discussion between Partners Group, us and DB's private bank. I think over time, we want to develop those capabilities. And I think having that Eltif's true structure is something, which is going to come quite handy for us. I mean, overall, with our knowledge on retail distribution and our knowledge in alternatives, having those Eltif structures for retail distribution in Europe is going to provide upside for DWS.

Now on private credit. We are progressing nicely, again, focused on Europe. As you know, once we have active fundraising, I can't really give updates. But based on very specific opportunities, I see in private credit, I would expect this to start contributing pretty meaningfully in 2026. A team complete and everyone actively fundraising. So senior folks complete. We're still adding like VPs and associates, but senior folks complete and actively fundraising.

I think risk reward and direct lending I don't want to be sort of the person that's not involved in direct lending in the U.S., making smart statements. I think risk reward and direct lending seems to be somewhat exhausted, which is why everyone seems to be focused on asset-based finance. I think what we've recently seen is that understanding, who owns collateral and ensuring that it's not pledged to multiple parties seems to be a skill set, which is distinctly different from credit underwriting of corporates.

So I don't know, if asset-based finance is for everyone. But it seems that more and more focus goes towards that. But otherwise, not a lot to add to what very smart people in the U.S. have said over the last couple of weeks.

The next question comes from Nicholas Herman from Citi.

Just a quick follow-up firstly on P4. So I think I missed it. What volume of commitments have you now closed for P4? The questions that I had are on your '26, '27 targets. You've been very explicit on the building blocks there. But I guess looking at consensus, it seems like the market is struggling I guess, with the revenue part of that. And I guess that's also partly because 2025 is clearly also a high bar with strong contributions from performance fees and from other income.

So I guess, my question is what is the market missing? And I guess the subset of that is, does the current run rate of fair value guarantees make it harder to achieve those targets, but also do your target -- am I correct that your targets seem to imply again outsized performance fees in 2027? Is that correct?

And then finally, just a request, given the increasing importance of your closed-ended funds, it would be helpful, if you could provide private market funds, it would be helpful, if you could provide us with periodic updates on fund performance for each of those key private market funds.

Let me do these like 3 questions. So P4, just to sort of make sure that it gets across clearly. So firstly, we do not need any fundraise of P4 this year in order to reach the EUR 4.50. We are still confident that we get to EUR 4 billion to EUR 5 billion overall. We're currently sort of in the 2s (sic) [ EUR 2 billion ]. Now what we've seen is that investors come in, in a bathed fashion, either very early so in the beginning to get discounts, or at final close, just to see performance of those assets being bought. Final close is going to be in Q2 2026. So plenty of discussions, plenty of due diligence and sort of happening. We just need to see how many choose to come in, in December, which is sort of calendar year, but not too meaningful to those investors or come in at final close.

Now your second question on '26, '27, what is the market missing? I mean I would obviously phrase it more modestly. I mean whatever assumptions you have are your assumptions, I wouldn't -- would be condescending to say that you're missing something. But let me just tell you how we are thinking about it. So when you look at the revenue run rate, right now, we're getting like a little above EUR 750 million on average per quarter. So let's just call it EUR 3 billion to whatever plus whatever Kaldemorgen, Concept Kaldemorgen is going to contribute, right?

So I think it's not heroic to assume that we'll get to EUR 3.1 billion of revenues for this year. I think the [ 1.8% ] of cost, I think everyone sort of believes us. So it will get you to a PBT of 1.3% for this year. Now when we promise 5.5% -- promise, when we talk about 10% or target 10% EPS growth next year, what we previously said is that, that would be a 5.5% revenue growth and about 2% cost growth. That was the underlying assumption when we communicated it.

If you break it down into management fees, performance fees, other revenues and costs, the way that we think about it is as follows. Our AUM in Q1 and Q2 was roughly EUR 1,010 billion. Average in Q3 was sort of EUR 1,030 billion looking at markets EUR 1,034 million, EUR 1,035 million. Obviously, markets have been on fire so far. So our current AUM is more like EUR 1,070 billion, EUR 1,080 billion. So I think when you think about the average AUM for the calendar year 2025, it will probably be in the EUR 1,030 billion on average in 2025.

Now when you think about the incoming AUM going into 2026, it doesn't require any heroic market development to kind of get quite close to EUR 1.1 trillion. Now if you believe our NNA assumption or net new asset targets for next year, right? So the EUR 150 billion over 3 years, let's just call it EUR 50 million for next year. And if you believe that, you would see that our average AUM in the year 2026 would be around EUR 1.13 trillion, right, like EUR 1,130 trillion, just based on where we stand today plus NNA, just by with sideways moving market. So without any market growth assumption for 2026.

Now EUR 100 billion additional average AUM obviously would translate at the current margin into, let's call it, EUR 250 million of additional management fees. Now if you do the math, getting from 3.1% -- extra 5.5% is sort of EUR 165 million.

So now when you look at performance fees, I think this year, we will get above the 4% to 7% target. Even if you assume that next year, we will not quite get there, but be at the upper end of the 4% to 7%, which I think would be conservative, but based on the P2 sales of assets, but if you want to assume that, you have quite some cushion between the additional management fee and the EUR 165 million that we have to get to in order to have revenue growth of 5.5%.

When you look at other revenues, this year was not special. I mean Harvest is performing really nicely. The contribution from Harvest in Q3 was the highest since what, Q2 2023, so we can discuss Harvest. But I think that is going up with the markets going up in China. The NII is stable. You mentioned fair value of guarantees. There was nothing special. I mean, the swap spread is still significantly negative. So you can call it a reserve. So I think the other revenues, my assumption would be for it to be similar next year to this year.

That's how we look at it, right? Again, it would be arrogant to say that you're missing something, but this is how we think about the revenue growth next year. I think the cost, everyone seems to believe us, which is why I mean, let's see what happens over the next couple of days, but that's how we think about the 10% EPS growth in '26 over '25.

Last question on closed-end funds, happy to provide it. I mean what we can say is that our close-ended infrastructure private equity funds are all top quartile performance. But that's a good challenge. So we will add that next quarter. Thank you, Nicholas.

The next question comes from Pierre Chedeville from CIC.

2 questions on my side. You mentioned the new world regarding digital distribution, AI, et cetera. My question is on the old world. And particularly, how do you see the evolution regarding third-party distribution ex-digital partnership I mean, with wealth management companies, things like that. And also the development of your presence within retail regional banks in Germany or elsewhere. In EMEA, where currently we can see a kind of riskier version, but that could change in the future? And are you still ambitious regarding this kind of old partnership?

My second question is on passive management. We can see that despite your efforts and also your dynamism on this part, we see that market share are quite sticky in this area between the 3 major players? And my question was, when you talk about external growth, you always mentioned potential acquisition in Asia. But never, as far as I remember, in the passive management business where we still have some minor players. What is your view on gaining market shares in passive management with external growth. Thank you very much for your very interesting presentation.

Thank you, Pierre. So Mark and I were just smiling at each other because we have like an internal allocation of duties at work. And your questions are also like in my remit. So it seems that Markus had hit it easier. So please, a lot of questions for Markus next quarter. Let me do in like reverse order. So on passive, you're right, the market shares are sticky. In Q3, we sort of grew at our market share.

I mean, is that dynamic or not, probably not as we'd like because growing at your market share implies that you sort of growing with the market, meaning your average and to all of the smart Xtrackers folks listening into the earnings call, obviously, you don't want to be called average. So we want to see more dynamism going forward. And I think that's going to come from further digital distribution partners.

So that's now in the 40s, I think last time we spoke about, it was in the 30s. We just approved the next growth phase of the Xtrackers business. I think we mentioned last quarter. So we approved, what like 20 additional salespeople for new regions, so that will grow. And our ETF as a service, active ETF and so on, gives us hope that we will grow above market like we've done in '23 and '24.

We're not really looking at inorganic growth in the passive space, to be frank. I don't know, if you would need it. I mean, I think our brand is pretty good, and I would want to invest in our brand or further invest in our brand rather than integrate somebody else's brand unless BlackRock wants to sell iShares, which appears unlikely. So therefore, I wouldn't expect any inorganic measures in the passive space.

Now your first question, let us be clear. I mean the digital capabilities, and that's what we -- why we phrased it as such, are mostly for the next generation, right? I mean we benefit from great work done by our predecessors. We are very happy to work hard so that the CFO and CEO of DWS in 2035 are happy with what we've done. I mean, I think it will contribute earlier than 2035, but I think you understand the logic. The vast majorities of revenues from DWS -- for DWS stem from the traditional business. And obviously, the biggest piece of it is our amazing retail franchise, specifically in Europe.

So let's say, traditional third-party distribution is the beating heart of DWS, right? Just to be clear. I think we mentioned before that our disciplined CFO called it whatever it takes in his address to the franchise early in the year, meaning we basically approved unlimited resources, marketing folks, campaigns and so on for retail for 2025, which I think you see in the numbers.

I mean we talked about the positive momentum shift in active equity. In Germany, we are almost flat, right? We had EUR 1.8 billion inflows in Q3, unfortunately, EUR 1.84 billion outflow. So we are slightly negative. But I think this quarter could be the one in which we actually turned positive in retail distribution equities in Germany. So this is by far the biggest focus that we have at DWS and will continue to be a dominant part of our franchise. Thank you, Pierre.

[Operator Instructions] There are no more questions at this time. I would now like to turn the conference back over to Oliver Flade for any closing remarks.

Yes. Thank you, everybody, for joining today and for your continued interest in DWS. As you have seen also our third quarter results, I think, highlight the resilience of our business in a still challenging environment, but it also reaffirms the good progress that we're making towards our 2025 financial goals and beyond.

And with that, I would like to thank you again, looking forward to any incoming questions on digital and other topics. We are around and please let us know, if there was anything that we can help with. Have a good day and bye-bye.

Thank you very much.

Bye-bye.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Good morning, ladies and gentlemen, and welcome to the DWS Group Q2 2025 Conference Call and Live Webcast. I am Youssef, the Chorus Call operator. [Operator Instructions] This conference is being recorded. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Oliver Flade. Please go ahead.

Yes. Thank you very much, operator, and good morning to everybody from sunny Frankfurt. This is Oliver from Investor Relations, and I would like to welcome everybody to our earnings call for the second quarter of 2025. Before we start, I would like to remind you that the upcoming Deutsche Bank analyst call will outline the Asset Management segment results, which have a different parameter basis to the DWS results that we are presenting now.

I'm joined as usual by Stefan Kreuzkamp, our CEO; and Markus Kobler, our CFO. And Stefan will start with some opening remarks as well as closing remarks, and Markus will take you through the main part of the presentation. For the Q&A afterwards, please could you limit yourself to the 2 most important questions so that we can give as many people a chance to participate as possible.

And please note that the Q&A session can also be extended beyond 11:00 if needed. I would like to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. And I therefore ask you to take note of the disclaimer and the precautionary warning on the forward-looking statements at the end of our materials. And with that, I will now pass on to Stefan.

Thank you, Oliver. Good morning, ladies and gentlemen, and welcome to our Q2 2025 earnings call. You will notice that my introduction today will be a bit longer than usual. I would like to take more time to walk you through our view on our financial performance and present our hypothesis for the path ahead, not just for this quarter, but for the year as a whole and the trajectory we see for 2026 and 2027.

As Markus takes you through the financials, I would like to ask you to keep this hypothesis in mind, which will hopefully help you challenge the numbers constructively. To put it simply, we are delivering exactly what we promised, sustainable earnings that put us firmly on track for the EUR 4.50 EPS this year, which we see as the jump-off point for 10% annual EPS growth in 2026 and 2027.

To frame that, I will start by revisiting the bridge we first outlined in 2024, then discuss the sustainability of our current earnings, the long-term investments we are making and the path to our 2025 EPS target of EUR 4.50.

I will then hand over to Markus, who will take you through our Q2 financials in detail and provide a deep dive into our balance sheet. And finally, I will return to present the outlook and explain why we feel well positioned to deliver a consistent 10% EPS growth annually in 2026 and 2027.

With that, let me begin with the first point, credibility of the bridge we laid out back in April 2024. More than a year ago, when we communicated our Q1 2024 results, we first presented the path to reach our 2025 financial targets. From the outset, the bridge was designed to be both clear and tangible with its main pillars being reduced cost-adjusted items, higher performance fees and rising management fees.

We committed to this bridge and have remained consistent in our financial steering ever since. Today, the numbers show that we are on track to deliver what we promised to the market, and we believe that consistency is what builds long-term trust.

Second, our growth does not come from one-offs. It's hard-earned, sustainable and the result of disciplined execution over the past years. What you see in our numbers is not a onetime lift. So we didn't just get in summer shape once. This was the result of systematic and sometimes difficult run rate optimizations that have reshaped the business for the long term. We've taken deliberate steps to optimize our platform, including reorganizing our legal entities to simplify our operating model, advancing our large-scale IT transformation project and reducing the number of internal committees by 42% to speed up decision-making.

As an additional example, we've reshaped our workforce, our largest cost line, but also one of our greatest sources of long-term value. As Markus outlined in his cost deep dive 3 quarters ago, we are growing talent from within.

Since 2023, we have quadrupled our graduate intake and implemented development programs to reduce our reliance on costly external hires. We've also built up teams in India and the Philippines, creating scalable, cost-effective hubs, which tap into deep resource pools. None of this happened overnight. Every improvement from cost management to platform efficiency has been the result of consistent focused effort over time. These tangible actions are central to how we've built a more efficient DWS optimized for the future, and we are confident in our ability to keep these costs stable while continuing to grow.

When Markus walks you through the financials, we will provide -- he will provide further insights into how these optimization efforts are reflected in our numbers. Third, we are investing for the long term. Alongside our cost discipline, we are also deploying resources with a clear focus on future growth to strengthen parts of the business that will matter most over the next decade.

We continue to expand Xtrackers in our alternatives platform, both of which are already delivering momentum in flows. To be more specific, we've recently signed off on our next multiyear growth plan for Xtrackers and will double down on our European infrastructure franchise with additional hires. We are also investing in the digital infrastructure that we believe will define the future of finance.

A key example is all Unity, our joint venture with Flow Traders and Galaxy, which recently received regulatory approval to issue Germany's first fully licensed MiCA-compliant euro-denominated stablecoin. Bringing the euro onto the blockchain is a foundational step towards a faster, more transparent and efficient European financial system and exactly the kind of forward-looking innovation we aim to lead.

We view DWS much like a family business. Our responsibility is to leave the firm stronger for the next generation. That means making the right investments today to ensure we remain resilient, relevant and positioned for sustainable growth. Fourth, we are firmly on track to deliver our EUR 4.50 EPS target for 2025, which we see as the jump-off point for the next few years. Markus will provide more detail in a moment, but let me share how I view the numbers and why we see this target as entirely within reach.

In Q1, we delivered an EPS of around EUR 1. And despite a very difficult April with heightened volatility and a weakening dollar, we delivered an EPS of EUR 1.07 in Q2. Given our current AUM is higher than the average AUM in Q2 and with an extra business day in both Q3 and Q4, you may assume a slightly higher EPS in the next couple of quarters, provided market conditions remain supportive.

This would put us on track for an EPS in the mid EUR 4.20 for the full year. To close the gap to our EUR 4.50 target, we would need to generate roughly an additional EUR 50 million of net income or EUR 70 million of profit before tax. As you know, we have some seasonality in our revenue generation.

In Q4, we expect additional contribution from 2 recurring key drivers. Firstly, performance fees from our flagship multi-asset fund, Concept Kaldemorgen model. And secondly, as I've referenced in prior calls, the PF4 fundraise is on track for significant closing by year-end, with management fees accruing back to August 2024.

So when we say we are at a run rate that supports EUR 4.50 EPS for 2025, we are on solid ground to meet this target. Importantly, we view this not as a one-off achievement, but as a hard-earned run rate, supported by the structural improvements and strategic investments we have made. Many of these investments, particularly in alternatives, digital assets, platform efficiency and the next phase of our Xtrackers growth plan will show their full value in the years ahead. With that, I now hand over to my partner, Markus, who will walk you through our financial performance in more detail and provide a comprehensive view of our balance sheet.

Thank you, Stephan, and good morning, ladies and gentlemen. Let me take you through the key financial highlights for Q2. In the second quarter, we demonstrated the resilience of our business model in a challenging environment, delivering an increased EPS of EUR 1.07. Our net flows were robust with EUR 3.7 billion in long-term net flows and EUR 8.5 billion in total net flows.

Revenues held steady at EUR 746 million, notwithstanding a decrease in average assets under management in the second quarter, reflecting the strength and the diversification of our revenue base. Driven by our active cost management, our net income increased and rose to EUR 214 million.

The operational efficiency improved, resulting in a cost/income ratio of 59.2%. Our capital position remains healthy with EUR 0.8 billion in excess capital, providing flexibility to pursue growth opportunities and shareholder returns. Together, these results reflect our strategic focus towards our 2025 financial target plan. Moving on to the financial performance snapshot in the second quarter.

Starting at the top left, long-term assets under management totaled EUR 893 billion, stable quarter-on-quarter with our net flows and market appreciation being almost entirely offset by unfavorable ForEx movements. Total assets under management remained flat quarter-on-quarter and stood at EUR 1.010 trillion.

Moving to the top right. Revenues remained stable compared to the first quarter at EUR 746 million and up 7% year-on-year. On the bottom left, costs amounted to EUR 442 million, down 6% quarter-on-quarter. Thanks to active cost management approach, the cost/income ratio stood at 59.2%, being down 3 percentage points quarter-on-quarter and 6.6 percentage points year-on-year. The continued operating leverage drove an 8% increase in net income quarter-on-quarter and a 32% increase year-on-year, reaching EUR 240 million.

Let me now share some insights into client dynamics during Q2. The client dynamics observed at the end of Q1 continued into Q2, shaped by elevated market volatility and a persistent risk-averse sentiment. Overall, we reported net flows of EUR 8.5 billion and long-term net flows of EUR 3.7 billion, a robust figure that underscores the enduring strength and appeal of our diversified product suite.

Although the flow picture has slowed in the second quarter, we were able to retain a positive flow momentum across all client segments and regions, being able to capture our clients' demand for risk management and diversified strategies through our broad product offering. For example, in APAC, we reported net flows of EUR 3.1 billion, marking our best performing quarter ever. Clients are increasingly receptive to European investment opportunities, resulting in strong net flows across various asset classes.

In EMEA ex Germany, the flow picture was impacted by market volatility, especially in passive strategies and totaled EUR 0.7 billion. Although the volatility led to high gross flow volumes, we saw limited net movement.

Net flows in our home market, Germany, amounted to EUR 1.4 billion, driven by an ongoing demand for passive products. The U.S. region recorded EUR 3.3 billion in net flows. While overall direction of asset allocation remained steady, demand further shifted towards highly liquid short-duration products, especially money market funds.

Across client segments, both retail and institutional investors showed a clear common trend, a strong focus on resilience and risk management. Despite ongoing market headwinds and a clear risk of sentiment, our retail business has delivered its 10th consecutive quarter of net flows. This resilience reflects the strength of our dedicated proactive focus campaign and our ability to align with client preferences.

Retail investors continue to favor risk-averse strategies, driving strong momentum into short-term fixed income solutions and advised quant-driven funds within SQI. On the institutional side, flows were positive with EUR 7.4 billion, led by inflows across asset classes such as infrastructure, passive mandates, multi-asset and cash.

The focus, however, continued to be on derisking, favoring liquid short-term solutions with diversification being a consistent theme. Moving to the quarterly highlights within our active business. In the second quarter, our active assets under management stood at EUR 442 billion, a quarter-on-quarter decline, primarily driven by negative ForEx movements, particularly within fixed income products.

The flow picture in active remains challenging with EUR 1.7 billion in net outflows. However, we observed encouraging underlying momentum, particularly in active equity. We recorded net flows into multi-assets and SQI with EUR 0.4 billion and EUR 0.2 billion, respectively.

These flows were largely supported by institutional mandate wins, including an LDI mandate in EMEA. Within SQI, inflows were partially offset by rule-based outflows as clients adjusted risk budgets in response to market conditions. Although our equity business reported outflows of EUR 1 billion, primarily due to previously notified mandate losses, underlying trends improved.

This was supported by reversal in rule-based inflows from SQI to equity amid a more favorable equity market environment. Additionally, DWS Invest top dividend attracted strong inflows backed by solid performance, while DWS Invest Artificial Intelligence continued to see steady daily inflows. Fixed income saw outflows of EUR 1.3 billion, while our top-selling DWS floating rate funds continue to attract strong inflows, these were outweighted by mandate losses.

Notably, our DWS ESG floating rate notes surpassed the EUR 1 billion mark in the second quarter. We continue to expand our active ETF offering. In Q2, we launched 3 new active ETFs, each targeting a different region, global, European and U.S. equities. So far, early investor interest has been strong with inflows exceeding EUR 205 million according to latest available data in July. In addition, we repositioned 2 active products, DB U.S. Dynamics Growth and DWS Invest Critical Technologies. The latter is designed to address today's geopolitical landscape, focusing on 5 key investment areas: Defense and Space, AI and semiconductors, energy security and infrastructure, advanced manufacturing and robotics and cybersecurity. These sectors are expected to benefit from the global push for greater technological autonomy.

Moving to our Xtrackers business. Our Xtrackers business delivered net flows of EUR 3 billion in the second quarter, marking the 10th consecutive quarter of positive flows. However, flow momentum was impacted by U.S. exposure and rule-based outflows in the quarter. Assets under management increased to EUR 346 billion as net flows and market appreciation offset negative ForEx movements. The main flow contributor was our UCITS business, which delivered net flows of EUR 1.9 billion.

Portfolio diversification and highly liquid products continued to gain momentum with strong interest in top-selling products like MSCI World ex U.S. and Euro overnight. U.S. exposure sell-offs impacted overall flows, particularly in S&P 500 equal weight ETFs and select sector client ETFs such as China and financials. To further strengthen our product offering and stay ahead of peers, we are preparing to launch U.S. equity swap ETFs on our Irish domiciled platform. Our mandates and Solutions business delivered EUR 1.1 billion in net flows, driven by a global Europe mandate win in Germany and 2 mandates from Southeast Asian institutional clients. These wins support the continued expansion of our Xtrackers institutional footprint and our core equity exposure. Our U.S. 940 1940 Act saw net flows flat in the second quarter, though performance was highly volatile.

In April, we experienced strong outflows after the market turmoil, followed by flow recovery in May and June, led by renewed interest in high yield and a rebound in ESG products. Despite the flat net flows, our U.S. platform continued to expand and reached USD 27 billion in assets under management. Overall, we are confident in our strategic development and our flow momentum has returned after a challenging Q2.

With the start of Q3, the Xtrackers business has regained strength, supported by a strong return of flows that has continued throughout July. As Stefan mentioned, Xtrackers has launched a multiyear growth plan focused on generating additional net new assets. This includes expanding digital distribution partnerships, entering untapped markets such as the Baltics and Eastern Europe and scaling our active Xtrackers ETF range through both internal and external strategies, positioning us as a full spectrum leading ETF provider.

As an example, in Q2, we expanded our digital reach throughout 3 new digital distribution partnerships, strengthening our strategic footprint. Let me now turn to our Q2 highlights for our alternatives platform. The development of our alternative platform continues in line with the trajectory outlined in last quarter's deep dive. In Q2, our assets under management totaled EUR 105 billion, remaining stable versus the previous quarter. Net inflows and market appreciation were offset by ForEx headwinds.

Infrastructure remained the growth contributor within our alternative platform, leading to overall net flows of EUR 2.4 billion in the quarter, which were supported by positive flows in liquid real assets. Fundraising efforts across various strategies such as our P4 fund and our newly launched U.S. real estate Core+ debt strategy continue to generate positive momentum and position us for future growth. Infrastructure contributed with EUR 3.9 billion of net flows, largely supported by a new fund mandate, which is expected to generate incremental management and performance fees over the next 12 months.

With the mandate, we have secured a controlling stake in the underlying asset, which will support the delivery of a successful equity for P1 and the Gateway funds, ultimately maximizing value for investors. Our LRA business recorded net inflows of EUR 0.4 billion, which were driven by renewed interest from institutional investors and the newly won SMA. The sentiment for real estate remains challenging. We report outflows of EUR 1.9 billion in the second quarter.

Around half of the outflows were attributable to a single redemption in our U.S. real estate portfolio. Despite strong asset performance, investors sought greater geographic diversification. For the EMEA real estate platform, the redemption queue continues to ease with incoming redemptions declining in 2025, likely driven by falling interest rates, market volatility and positive year-to-date performance, particularly in our Grub funds. Our private credit platform build-out is progressing steadily.

The wind down of our European CLO business is now complete with the warehouse fully sold down. We have expanded our strategic partnership with Deutsche Bank across both investment and corporate banking. Our focus now sharpens on European direct lending and asset-based finance with key hires already made. Fundraising is underway for our European Direct Lending Fund II, building on our successful partnership with Deutsche Bank. We expect the platform to begin generating revenues in the first half of 2026 with asset-based finance following in the second half.

Let me elaborate how this performance impacted our P&L. Revenues remained stable quarter-on-quarter at EUR 746 million and marked a 7% increase year-on-year. Management fees declined slightly by 1% quarter-on-quarter to EUR 630 million. This was largely due to lower average assets under management, a result of foreign exchange headwinds and continued investor caution amid macroeconomic uncertainty.

However, it is worth emphasizing that this slight decrease was well contained, demonstrating the resilience of our client franchise and the strength of our globally diversified product offering. Performance and transaction fees totaled EUR 58 million, supported by the fee recognition of PF2, Speciality Invest Funds as well as Real Estate APAC. Other revenues amounted to EUR 58 million, including EUR 26 million from net interest income and a EUR 11 million contribution from Harvest. Moving to our cost development. As many of you may know by now, I am passionate about active cost management.

In the third quarter of 2024, we introduced you to our active cost management approach, a key enabler of our sustainable profitability and operating margin projection, particularly in volatile market environments. As part of that deep dive, we presented our robust cost management framework that distinguishes between discipline-based cost, expenses we can directly control through rigorous planning, budgeting and process optimization and volume-based costs, which are inherently linked to market dynamics and client-driven business growth.

This combination of discipline-based cost control and agile management of volume-driven expenses ensures our cost base remains both. Flexible and aligned with market conditions and strategic priorities, something the second quarter with its challenging backdrop has clearly reinforced. In this quarter, total costs declined by 6% quarter-on-quarter to EUR 442 million, driven by reductions across all cost management pillars, keeping us on track for essentially flat costs in full year 2025.

Compensation and benefit expenses were managed prudently, reflecting a 9% decrease from the previous quarter due to primarily lower retention-related expenses. General and administrative expenses were also contained, driven by lower volume-based costs. As a result of these concerted efforts, our cost/income ratio improved by 3 percentage points versus the previous quarter, now standing at 59.2%, being below our full year 2025 guidance of less than 61.5%.

This outcome demonstrates effective stewardship over our cost base, but also provides valuable headroom to continue investing in future growth initiatives without compromising our profitability. Moving now to our balance sheet deep dive. This quarter, I would like to provide you with a comprehensive look at our economic balance sheet and capital position. As of Q2 2025, our economic balance sheet remains simple, stable and robust, underlined by a solid liquidity position and backed by capital with no debt financing.

Our economic balance sheet matches our consolidated IFRS balance sheet, but excludes assets and liabilities from investor-owned funds such as guaranteed funds and matching items related to unit-linked life insurance investment contracts. Key characteristics are a strong equity and liquidity position as well as corporate investments to support our business and intangibles. This structure provides financial resilience and flexibility to support growth and shareholder returns.

Looking at our capital position, we speak of tangible equity as our key capital supply metric. It is central to our economic capital adequacy framework, ensuring that we not only comply with regulatory standards, but also maintain ample resources to support the risks inherent in our business. As of Q2 2025, we hold EUR 0.8 billion in excess capital, which is a solid buffer and well above our target capitalization. It reflects our financial strength and gives us strategic flexibility going forward.

Our capital management strategy is dynamic. We are continuously stress testing our balance sheet under a range of economic and market scenarios, incorporating lessons from recent volatility and industry shifts. The excess capital not only enhances our resilience in uncertain markets, but also provides us with meaningful optionality, allowing the group to respond decisively to attractive growth opportunities, potential inorganic investments or adapt to evolving regulatory requirements without undue delay or stress.

Since our IPO, we have remained committed to the efficient and responsible return of capital to shareholders. We have now returned EUR 3.44 billion to shareholders via ordinary and extraordinary dividends, a clear reflection of our focus on shareholder value creation. Looking ahead, we have announced our intention to establish a sustainable dividend payout ratio of approximately 65% starting in 2025. This strikes the right balance between generous shareholder distributions with reinvestments in future growth and innovation.

All in all, our economic balance sheet and capital position demonstrate not just financial robustness, but also the discipline and long-term thinking that shape DWS strategic direction. We are confident that this solid foundation enables us to finance innovation, navigate uncertainty, reward shareholders and support sustainable organic growth well into the future. With that, let me now hand over to Stefan for his closing remarks.

Thank you, Markus. Now let me turn to our outlook for 2026 and 2027 and specifically how we plan to build on a strong and sustainable earnings per share base we've established and converted into continued growth over the coming years. As I said in the beginning, our hypothesis is clear. We are delivering sustainable earnings built on a foundation of structural improvements and strategic investments.

From an EPS jump-off point of EUR 4.50, we see a clear and tangible path to 10% annual EPS growth in 2026 and 2027. As we look ahead, maintaining active cost management remains just as important as driving revenues.

While we've held costs flat for the past 3 years, we are being realistic about the future and therefore, assume that costs will increase around 2% annually going forward. To achieve 10% EPS growth on this cost base, we need revenue growth of roughly 5.5% per year. We believe that is achievable through a balanced combination of market performance and inflows.

Previously, we flagged EUR 150 billion in net new assets cumulatively over 2025, 2026 and 2027. As expected, market turbulence led to slower flow picture in Q2. Fortunately, as client momentum has picked up again, we're now back at our typical monthly run rate and our ambition remains intact. We expect that growth to come from the key areas where we are already investing and seeing momentum.

First, our active business remains a steady contributor to our platform. We recently extended a key distribution partnership with DBAG, Germany's largest independent network of financial advisers for another 10 years. This speaks to the strength of our relationships and our long-term positioning in the market. We've also expanded our active product range with the launch of 3 enhanced active ETFs, providing clients with new solutions and helping to broaden our reach.

Active multi-asset strategies and SQI both saw inflows this quarter, and we expect that they will continue to attract strong client demand. Second, in Xtrackers, the trajectory remains positive with steady growth over the past 3 years as we scale up. We continue to see strong inflows into key products like MSCI World ex U.S. and Euro overnight. We're also giving clients new ways to access our expertise through innovative solutions like ETF as a Service, and our digital distribution partnerships are playing a key role in accelerating flows.

As I mentioned earlier, we have now signed off on a dedicated growth plan over the coming years. Third, in alternatives, we delivered positive inflows in the first half of the year, and we expect that momentum to continue with a solid pipeline for the second half. Our Gateway to Europe strategy is starting to pay off with the capabilities we have built now beginning to deliver tangible results. We're making further investments in infrastructure, including hiring specialist talent to strengthen our platform and meet growing client demand.

We're also moving forward with the opening of our Abu Dhabi branch, which will further expand our global reach and bring us even closer to key growth markets. As an asset manager rooted in Europe's largest economy, we are uniquely positioned to help clients unlock the full potential of the opportunities ahead. Our strategy remains fully aligned with our financial steering, and we continue to be one of the few asset managers with no distractions from restructuring or integration.

Based on this position and the outlook we have outlined, we are confident that 10% annual EPS growth is realistic and achievable. So to summarize, we are firmly on track to deliver EUR 4.50 EPS in 2025 and are comfortable using this as a jump-off point for future growth. We have a clear and tangible path to delivering 10% annual EPS growth in 2026 and 2027. And while we stay disciplined on costs, we are continuing to make long-term investments in our platform, capabilities and people. We look forward to being challenged on this, but we hope we have gained credibility by showing you the hard work and discipline we've put in over the past couple of years, work that we feel has put us in a strong position.

Based on what we've outlined, we have built a sustainable revenue and cost base and set the foundation for long-term profitable growth. Thank you. Over to Oliver for Q&A.

Yes. Thank you very much, Stefan. And operator, we're ready for Q&A now. [Operator Instructions]

[Operator Instructions] The first question comes from Hubert Lam from Bank of America.

A couple of questions. Firstly, on the target for this year of 4.5%, what market assumptions do you have for the rest of the year? And in terms of your performance fee assumptions, how much of it is driven by fees that you've already locked down, but yet to recognize versus those you need to perform some markets, such as like Kaldemorgen? The second question is on active ETFs. How important is this for your growth outlook in Xtrackers going forward? How much has it contributed to your inflows within X-trackers today? And like how big of it as a percentage of your AUM is it? I assume it's pretty small at this stage.

Hubert, thank you for your questions. I'm just going to start and then see if Markus adds granularity. So first question, for our target of EUR 4.50, what is the market assumption? And how much of the performance fees are essentially locked in?

So market assumption basically in line with our CIO outlook, which -- so like markets have already surpassed what we had expected or what we expect over the next 12 months. But I would just say broadly stable markets. So nothing heroic. We had initially assumed market growth in the mid-single digits for 2025. So obviously, there's been more than that. But so for the next couple of quarters, we just expect broadly stable markets. When it comes to the performance fee, the P2 performance fee is basically locked in. So I want to be careful how I phrase it.

But from an accounting perspective, we're now giving credit for the essentially inherent value that was created over the past few years. And based on market discussions that we had with potential buyers, we feel pretty confident about that being a floor to ultimate valuation. So when you look at the contribution of PF2 performance fees, which was like EUR 30 million in Q1, roughly EUR 30 million in Q2, a little bit more in Q2. I would expect similar performance fee to come in Q3 and Q4, and it's basically locked in.

What would come on top is a potential concept Kaldemorgen performance fee, which we always book on the last day of the year. So that would be Q4. I think everyone understands the math, right? So we have EUR 11.1 billion of essentially funds that are eligible for performance fee. We get 15% of that. They're in the money. So multi-asset as you would expect, have -- I mean, I guess, phrased positively, they navigated markets well enough that they are ahead for the year despite obviously having a global portfolio in euro, which was impacted by euro-dollar, but they're in the money.

So that's a performance fee that you would expect in Q4. When it comes to active ETF, I think you're both -- you're right with both of your assumptions. This is important going forward, but at this point in time, has a reasonably small percentage of AUM. So the launches were successful. We raised a couple of hundred million.

I mean, I guess all those numbers you can see if you dug for it on Bloomberg. But the launch was positive, collected a couple of hundred million. We think it's going to be an important feature going forward, just like other like thematic ETFs. And yes, so excited for the future of the active ETF franchise.

So if I just add one detail there, Hubert, I mean, we are extremely well positioned in that growth area, and it's also one of our focus area, active ETFs. And we have already started launching the first ETFs in the course of 2024. And as of the end of the first quarter, we were in terms of assets under management around EUR 300 million.

But I also mentioned before that the 3 newly launched active ETFs have already gathered more than EUR 200 million. So that is still a small segment, but growing very fast.

The next question comes from Jacques-Henri Gaulard, Kepler Cheuvreux.

Two questions from me. One is about the outlook for the year. My question is more on the change of tone. Q4 2024, brilliant, confirming EUR 450 million, everything is fine. Q1 '25, the story definitely a bit more wbbly. We're talking about a range of EUR 450 million and EUR 460 million. And I have the feeling that in answer to what you gave to Hubert immediately, I mean, more or less what was on PIX2 was more or less predictable.

So what makes you now more back on the balance of certainty and what makes us believe that we're not going to have something a little bit less secure, I would say, in Q3? That's the first question. And the second, thank you very much for the excess capital, Markus. Within that, the requirements have remained amazingly flat since 2022. So is it fair to assume that the requirement will not really move over the next 2 to 3 years if we try to actually value the excess capital from '25 and '27?

And on a modeling purposes, to go from EUR 800 million to sort of year-end figure, do we just have to take retained earnings as an addition? Is that a fair way to look at it or estimate the retained earnings? Or is there a quarterly aspect within the excess capital that we don't know about and that you could guide us on?

Jacques Henry, thank you very much. By the way, thank you for -- to everyone like limiting yourself to 2 questions. You have unlimited questions on European infrastructure or your stablecoin, if anyone cares. So that's on top of your 2 questions. But starting with the first one, so tone, our Q1 earnings call was in late April, and the world just didn't look amazing in late April. So at that point in time, we simply didn't quite know what May, June, the recovery we saw specifically in equity prices. So at that point in time, we simply said, look, EUR 450 is still in sight.

However, range of outcomes slightly broader. I think that was the terminology we lose. So since then, markets were much better than I think you were able to expect in April. And I think that's simply reflected in our statement. I mean, again, the logic that we are simply applying, we had EUR of EPS Q1, EUR 1.07 Q2. Q3 and Q4 have an extra calendar day. Our AUM is now like EUR 10 billion, EUR 15 billion higher than the average AUM in -- so therefore, given that the performance fees are mostly baked in, meaning should be similar in Q3 and Q4 to what you saw in Q1 and Q2, we simply feel we are currently on a run rate kind of getting us into the mid -420s simply from that run rate.

And then in Q4, we have those 2 extra items, one, the Kaldemorgen performance fee; and second, the T4 fundraise. And I think everyone understands you get the management fees accruing back to when the first asset was bought, which was in August 2024. So a couple of billion, whatever you assume, that's our target.

Those 2 items combined would then add the EUR 70 million plus of profit before tax, EUR 50 million of net income, which would get us to the EUR 450 million. So that's why at this point in time, granted markets look better in the last 3 months than April, but that's why our tone is now more confident. I mean, again, we haven't deviated from our bridge. But obviously, the confidence and the range of potential outcomes is a bit market dependent, and we feel better now than 3 months ago.

And happy to address your question with regards to the excess capital. On Page 11, it shows the dynamics. I mean we are using tangible equity as the capital supply. And on the capital demand side that is relying on 2 pillars. The first one is regulation-driven I EU regulation from 2021.

And additionally, we have our internal model where we assess all the risks. So again, given the course of the business, we are generating, again, net income, and that is adding to the tangible equity. And on the other hand, we also pay out dividends. And that again is going to then reduce the tangible equity. So all factors stable, we currently accrue our excess or increase our excess capital between EUR 200 million to EUR 300 million on an annual base. And that comes on top of the EUR 800 million, which we have as of end of Q2.

The next question comes from Angeliki Bairaktari from JPMorgan.

First of all, can I please check whether the strong flows that we saw in infrastructure reflect any incremental fundraising in P4 in the second quarter? Or is the additional capital expected to come in the second half of the year for this fund? And second question, can you provide a bit more color on the avenues to monetize the Eurostablec-oinventure that you're working on? And what could be the revenues earned from this initiative? And under which time frame are we looking at?

Thank you, Angeliki, for the 2 questions. Let me take both. So we had a small close in P4 in Q2, but it was small. So that significant inflow was a separate mandate. That separate mandate comes at a lower fee than the average in alternatives because it was a essentially significant mandate we took over from another asset manager in a specific situation. So this is hard earned. We competed against multiple other asset managers to win it. It brought us a relationship with a bunch of new LPs, which we quite enjoyed. So therefore, it's going to be supportive for the P4 fundraise, but it's completely separate to P4. That's the way to look at

it. Secondly, and thank you for the stablecoin question. So that kind of gives you another couple of questions that you may ask on top of it. So that joint venture with Galaxy and Flow Traders is something which obviously we've worked on for a number of years. So it was hard work, as you would imagine. And the all Unity management team run by or led by Alex Suttner is excellent. We look at 3 different ways of monetizing. And they're essentially with increasing relevance, however, also with an increasing time frame.

So it's crypto, securities on blockchain and payments. That's how I look at it. So obviously, all Unity is going to participate in the crypto ecosystem. So for retail investors in Europe to simply go on-ramp, off-ramp if they want to buy crypto. I mean that's something which you have to do. It's part of the ecosystem and it's going to create revenues short term.

I think secondly, what is, I think, more exciting, once securities are cleared on chain, so whether that's bonds, stocks and you see multiple experiments, obviously, the other leg needs to be a stablecoin. I don't think anyone is going to buy DWS shares and exchange it against other shares or DWS shares against Bitcoin, right? You would be, at some point, buy our shares on blockchain.

And the other leg would be euro, and that would be a euro stablecoin. Our hypothesis is that at that point in time, you will not choose the stablecoin of a fintech launched stablecoin regulated in the Baltics, nothing against those regulators. But I think you would prefer a large stablecoin, MiCAomliant launch in Germany. So that's why I would imagine that to be a significant source of revenues.

However, that will take a couple of years because that's more an experimental stage. I think third, when you think about payments, that is quite exciting. So Unity is already engaged with at least one large corporate that wants to pay employees in a non-euro country. And simply as opposed to converting euro into that local currency, they want to send the employees stablecoin, so euro on chain and then they can do whatever they want to do with it.

So I think that is something which is going to be quite interesting as everyone understands. Bitcoin aren't really great for payments. And therefore, this is going to be a further use case. And again, I would imagine multinational large blue-chip corporates to choose a properly regulated Germany regulated or France regulated stablecoin.

So therefore, quite excited about the outlook for the next few years. I think for the purposes of your 2026 model, I would not assign a lot of value to the Unity inflows, which, by the way, will come from 2 sources. I mean, one, managing the collateral, but obviously, secondly, dividend simply of our 1/3 ownership. I would say the timing of it couldn't have been more interesting given the circular IPO and like the excitement around stablecoins in the U.S.

And I think that competitors currently waking up to that and trying the same. I mean, it will take a couple of years, right? This is very difficult to get regulators in Europe comfortable. And that's why we are happy that we started that we seed invested that a couple of years ago. And again, I think the revenue outlook for the next 5 to 10 years could be tremendous.

I'm going to take the opportunity to ask one more question since you give me that opportunity. Just on passive flows that they were much lower than the run rate this quarter, and you did explain why in the presentation. But when I look at some of your competitors in Europe, for example, the #2 player by AUM, they had much stronger ETF flows in Q2.

So is there anything there that has played a role? Is there any concern about your sort of near-term market share loss? And what is the outlook for passive net flows for the rest of the year?

Thank you, Angeliki. I think when I said that you have another question, I should have caveated that, but that's fine. So look, let me not beat around the bush. Our Xtrackers franchise had an off quarter in Q2. It is what it is. I think when you look at our flows, EUR 3 billion of inflows in Q2, yes, you're right, they had 10 quarters of consecutive inflows, but the EUR 3 billion is a fraction. It's like 1/4 of what they had over the last couple of quarters. So they had a bad quarter.

Now Markus, Rauramo and I had a series of business deep dives, like in-depth deep dives with the team. That's probably less pleasant than what it sounds like for the team. And look, what we realized is sometimes a lot of bad stuff comes together. So what the team was exposed to in Q2, and I'm not being defensive, I'm just explaining, is they had aggressive fee cuts from competitors in areas of relevance to us. We lost a couple of large institutional mandates, a couple of campaigns didn't go as expected.

We are the largest provider of Chinese as shares ETF in the U.S., which you would imagine was in flavor of the month in April and May. We had some rules-based outflows stemming from our SQI strategy. So frankly, a lot of stuff came together in Q2. So after a series of deep dives to the team, we simply said, look, Michael Jordan, Roger, Feder, Lion Messi, I mean, great players have off nights.

Don't make it a trend, but we believe in the outlook of the market, and we believe in the management team. So we signed off on the new growth plan for the next 3 years, which is quite ambitious. And when you look at our flow share in Q3, that's back at 15% versus the market share of 10.6%. So we feel that we've bounced back nicely. But again, I'm not being defensive. Q2 was an off quarter for Xtrackers.

The one thing I would say when you look at our flows, when you look at minus Xtrackers, so you look at total long-term flows and subtract Xtrackers, with a few quarters in which the rest was negative. This time, the rest was actually positive, to also -- and maybe there will be questions on all flows to other parts of the franchise.

But this quarter, the flow momentum was entirely down to X-trackers having an off quarter, but we are very confident in their ability to bounce back. And therefore, the growth outlook and the monthly run rate that we've seen over the previous quarters, that is now recovered in July.

The next question comes from Arnaud Maurice Giblat,

BNP Paribas Exane.

I've got a quick follow-up. Did I hear well that you said that P4 was activated in August 2024? And my 2 questions are, firstly, in terms of your targets on the alternatives, could you break out what the flow expectation is there, which areas they're coming from?

I mean if you could give us a little bit more granularity looking out over the next 2 years as to how much you expect the private credit business to scale, whether there's other launches in infra, et cetera. I mean I'm just wondering what sort of quantum of money you can raise there over the next 2 years.

And secondly, EUR 0.8 billion of surplus capital, thanks for the extra disclosure there. Clearly, you did a special dividend last year, and you're talking about distributing eventually excess capital to shareholders should the opportunities not come available. I was just wondering if you could put a time frame on that.

Thank you, for the question. I would address the second question you asked about the excess capital. Again, we do not put any time frame on what we do and whether we would pay any extraordinary dividend. We believe now we are in a position of strength at DWS, and we're also not under time pressure. And we also mentioned before that we are open for inorganic opportunities if they're going to add shareholder value, which means they both increase our EPS, but also afterwards help to further grow the business.

And to keep that flexibility open, that allows us to work active on targets, but also then only move ahead if something really makes sense. But we have already said back in December 2022 at the Capital Markets Day, if we're not investing into an inorganic opportunity or and internally, we would return money back to the shareholder. And again, that's why we decided also to provide this time a bit more transparency on our balance sheet.

And Arnaud, the question on alternatives. So firstly, yes, to confirm, P4 was activated, I think it's actually a good term in August 2024 when we bought the first asset. So I think as all of you know, private equity side, everyone coming in later is paying management fees accruing back to when the first asset was bought.

So I think the best way to think about it is assume fees 1%. Anyone coming in, in December 2025 will have to pay 7 months worth of management fees.

And given that we target a EUR 2 billion capital raise, could be a bit more, it could be a bit less. I mean that's essentially the math behind it. You asked about specific flow targets for the various parts of alternatives, which we haven't broken out so far. And I don't know if I would want to do it just because there's so much happening in that space. But I will give you like high-level slight thoughts.

Starting with the easiest one, the liquid real assets, which is always a good leading indicator for alternatives overall. We have now seen positive inflows in Q2. So you saw that roughly EUR 0.5 billion. And I would continue that path or I would expect that path to continue over the next few quarters. So let's just assume a couple of billion a year.

Infrastructure is looking nicely, right? So we have obviously P4. We have something else called SGI, which is more, let's say, core plus European focus that will be raised at some point after P4 is closed.

And our infra business in the U.S. is something which actually I haven't spent enough time on explaining, but that is a very nice neat infra debt business, which I'm happy to explain in more detail if anyone care. But that will also add a couple of billions a year. So I think for infrastructure, I would just expect a couple of billion a year in Europe, a couple of billion a year in the U.S. It could be more.

I mean, look, we are waiting for the fiscal Bazuka in Germany and getting ready for that. Once that comes, we should be one of the -- how do I say, I mean, the gateway to Europe is probably the best way to think of it. So we would be one of those asset managers that global investors trust deploy capital in Germany.

Again, this is not part of our growth plan that would come on top if it came to that. When you look at real estate, that's probably the toughest one because rates in the U.S. are just not coming down. However, hardly U.S. is trying. So therefore, that business is still slightly challenged, as Markus explained, with a couple of large outflows, institutional outflows, lower margin than the average, but still outflows. So I would like to say that, that business has stabilized, but I've said that for a couple of quarters.

So for U.S. real estate, I would probably be cautious for the next 12 months. At some point, that will recover. And our real estate debt in the U.S., that's off to a good start of investor discussions. So that's something which we've launched a couple of months ago. So that will add. But I think U.S. real estate is probably one of the bigger swing factors. European real estate looks more promising.

So the [indiscernible] outflows have slowed. I mean, I think everyone understands we have good visibility given that we have 12 months notice. So that is much lower now than in Q1, lower than in Q4 last year. So that's helpful. And we had a nice inflow in European real estate from an Asian investor. So I think for European real estate, I'm more optimistic.

Private credit, we are now basically complete with the senior team off to good discussions. We will not raise capital in '25, but that is something which I would expect to start meaningfully contributing in '26 and '27, but more to come on that front.

The next question comes from Bruce Hamilton, Morgan Stanley.

So the 2 from me would be, firstly, just going back to the German sort of Bzuka, the infrastructure spending plans. How do you think about that in terms of -- do you have any concrete plans for how to participate in the public private?

I know there's not a lot of clarity yet, but how do you look at the time frame? And how much could that incrementally maybe add to the sort of GBP 2 billion run rate you're talking about would be the first question.

And then the second one would be on the sort of pension reform proposals that are working their way through under the savings and investment Union. Obviously, we're in a consultation period. So I'm keen to understand what you are pushing for, what you think good would look like, what -- whether there's more opportunity through auto enrollment, whether it's more through kind of tax incentivized savings? Or what could drive household savings into more productive assets? What would you be pushing for there?

Thank you, Bruce. So both questions fully understood. I will be cautious when I speak about them because if I put out large numbers, it's going to be somewhat lane because if those reforms don't come, I would just be able to say, hey, we tried, but not our fault. So that's why I will give you my true and fair view, but then all of you will need to haircut it to whatever extent you want to do it.

So starting with the large infrastructure program, that will come. So I have no doubt in my mind, and you've seen some of the news flow out of Germany on Monday when the CEOs of the largest companies all committed to invest in Germany and the Chanceler and Finance Minister and Economy Minister making their commitments. So that will come. That will not just be infrastructure investments. I mean, some of the other items like growth investments in VC, which is something we haven't really done, but then again, nobody else has really done in Germany. That could be an interesting opportunity.

So when it comes to all the things happening, which we would essentially make investable through alternatives, this is much broader than just infrastructure and lots of discussions are happening. We're not opening a branch in Abu Dhabi to sell money market funds. And same applies to investors from Asia.

So I'm quite optimistic, but again, I want to be careful just because it depends on decisions, which I think will come in the next few months, but not like in my hands. I think the pension reform is similar, right? And really, when you think about all pillars 1, 2 and 3, I'm pretty optimistic that big reform packages will come.

So I'm pretty optimistic that the people in charge will really make, I would imagine, the biggest reform package potentially in the history of Germany, definitely in the last 20, 30 years. And that will probably include government investments in Pillar 1. I think it will be more mandatory for corporate pension funds to fund pension plans, and we've seen the first steps in that direction and also provide incentives for Pillar 3. Again, I mean, this will be open to anyone.

And by the way, for the record, we are always advocating not doing anything just for European asset managers. I mean, we should be competing against anyone. And I wouldn't want to exclude any U.S. competitors from any of those. However, it will be a significant opportunity for DWS, again, and really coming from, I think Pillar 1 will be mostly like covering in institutional. Pillar 2 will be difficult for others to access because our partnership with Deutsche Bank's Corporate Bank probably gives us better access to corporate pension funds than most of our peers would have.

And Pillar 3, conceptually open 21. But I think having strong partnerships with the DBAGs, the Deutsche Banks and other distributors will also be helpful. So again, we're quite optimistic. Pillar 3 will be ETF, but also active equity. Maybe one point to add, when you look at our active equity, yes, there were outflows overall. But when you look at the gross flows, what's quite interesting is that out of the EUR 3.5 billion of gross inflows and then EUR 4.5 billion of outflows, but the gross inflows were much broader diversified coming from real retail investors, where some of the outflows were larger mandates. So therefore, also quite optimistic about this part of the business.

The next question comes from Pierre Chedeville, CIC Market Solutions.

I would like to focus my 2 questions on the cost, which was clearly a good point this quarter. And I wanted to know -- I didn't do my math, no time this morning, but I would like to know what could be your target in terms of cost/income ratio in 2027, considering your 5.5% growth in revenues and 2% growth in cost.

Could you give us, I would say, what would it be in terms of cost/income ratio? And if we come back a little bit on the cost themselves, could you explain me a little bit better what is exactly retention-based cost? How do you see them evolve? Because I don't know exactly what you mean by that?

And also in terms of externalization, you mentioned 2 countries in which you externalize people. Do you think that you have here something that is not to be improved or it's stabilization in terms of organization of the job has been done.

And thank you, Pierre. And I'm going to start and Stefan, you may add afterwards with some additional thoughts. With regards to your cost-income ratio question, I mean, first of all, we are well on track. When we outlined that we're now talking no longer about adjusted cost/income ratio, about reported cost-income ratio, we explained it last time that the target for this year is 61.5%.

And year-to-date, we are at 60.2%, and that is probably going to improve further going forward. Now when we also look forward and Stefan outlined how we see the cost line to develop with around 2% per year, but stronger revenue growth, that again shows improvement of the cost-income ratio as well towards '26 and '27. I would not put a figure there yet, because on the other hand, we also -- we want to be in the ability or having the capacity and the ability to invest, right? We continuously improve our operating model.

And as a consequence, the run rate costs, both for compensation and benefit costs as well as for G&A costs should come down, which should also free up resources we can then reallocate into productive investments. And so we have cost/income ratio as one of our KPIs, which we use for our financial steering. But the #1 KPI is EPS and EPS growth.

And we would not compromise EPS growth just to achieve a in-point cost/income ratio, which anyway is depending on other factors, which we can't influence. When we talk about to your other question, Pierre, about retention, that is share price. And as part of the variable remuneration, so again, when you look at our cost base, very, very simple cost base, about 50% compensation and ben, 50% non comp.

And within comp and ben is about 1/3 is variable remuneration and 2/3 is base salaries and add-ons. So in that, in the variable remuneration line, some of our staff are incentivized and have the retained variable remuneration, which is linked to the share price. So if the share price goes up, that goes up. And if the share price goes down like in the second quarter, that comes down. So that's to your second question.

Then the third question about externalizing resources. And I spoke about that a few quarters ago. We very much look at that very broadly and comprehensively. Our employees, our people is the most precious assets we have, and we invest into our people, which we call active human capital management. And what we had a few years ago, we were depending on, again, on a very high number of externals, which again is important that we add resources, especially when we have projects.

But as a company, you would like to have as much as possible of this -- of the human brain of the human capital be internalized -- so you can afterwards also invest into that. And that's what we did when you look at -- and Stefan spoke about the graduates, but we also have been increasing our workforce in India and in the Philippines because that's such a deep pool of experts, and we're just at the beginning, tapping into that, which then again, obviously, in combination of our staff in other locations are working on that.

And so we're not looking about compensation benefit cost just looking as a line item in the cost base, but we look at it as an asset, right? It's like a balance sheet in which we invest for long-term value.

And Pierre, that was obviously a comprehensive answer. The only thing I would add when it comes to India and Philippines, very publicly, 18 months ago, we banned the term outsourcing because sometimes people almost imply that we are moving small tasks to those folks in India and Philippines. And our view is quite clear.

I think the average IQ of people in the Philippines and India working for us is, I would say, at least the average of DWS, probably higher given when you think about what percentage of the population would be working for a Western company. So what we've done, and this is in line with what we have done in the Corporate Bank, Deutsche Bank, for example, is move whole essentially services or parts of the value chain to India, then you get phenomenal outcomes.

So part of our investment engine in systematic quant investments sits in Mumbai and so on and so forth. So therefore, this is not just a cost play, but in some cases, you simply have access to excellent talent, and it's something which we intend to leverage even more going forward.

The next question comes from Oliver Carruthers from Goldman Sachs.

Oliver Carter from Goldman Sachs. So European ETF flows are having a record year. The market is now growing flows at a faster rate than the U.S. and -- but access to ETFs in Europe is still well behind that of the U.S. market. So it feels natural to ask a couple of questions. So number one, are you seeing U.S. asset managers increasingly trying to compete here with your Xrackers business?

And then number two, if they do try and compete more, how durable do you think your incumbency market share position is here? So I guess, really, beyond the market leader we all know, do the U.S. players have a right to win here in your home European markets?

Thank you, Oliver. Do they have the right to win? I think so, just like we have -- actually, so you always have a right to compete questions. Obviously, do you have a right to win. So I think European ETFs, and I don't want to lecture anyone, slightly more difficult than U.S. ETFs simply because you need to have financial infrastructure in every country where the underlying stocks are being traded.

So slightly more difficult than just doing the U.S. Obviously, iShares and you said the market leader, let's not talk about them. I think you've seen Venguard gain market share. They probably found it slightly more difficult in Europe than in the U.S., but they're growing market share. So I think that people have a right to compete and probably a right to win. I think my view is, though, if you really want to understand how the digital platforms are operating, how ETFs can be integrated in solutions for corporate funds and so on.

If you simply assume that we're going to have the same disruption in Europe that we've seen in the U.S., meaning ETFs just sort of taking over, then your knowledge of essentially the whole client base in Europe is going to be paramount. And I think that's going to be difficult for a new market entrant that doesn't understand active to win, right?

So therefore, I think just understanding retail is not going to be enough given the difference in distribution mechanisms over here. That's number one. So I feel that our market share of which was 10.6% in Q2 would be higher now after like a strong start to Q3. That is supposed to grow, right? I just want to be very clear.

The new growth plan that we signed off is more ambitious than the growth plan, which we signed off on 3 years ago, and the team materially outperformed that growth plan. So we are quite optimistic. But again, that's quite granular. So we feel that we can continue market share. But I just look at Markus, we had, I don't know, 60 different initiatives as part of that growth plan.

So when I said that in-depth business reviews with Markus and I are, maybe not as pleasant as it may seem. It's not that we just say phenomenal last 3 years, here's your new budget, please run. There was very, very specific growth plans for countries in Eastern Europe for new client types we haven't accessed yet.

I think a deep understanding of not just what platforms have done over the last couple of years, but investments in API, and we just made a bunch of hires in that tech space in order to be even more integratable into all of those digital players. So it's a broad series of specific initiatives, which we are confident is going to allow us to grow our market share from here.

The next question comes from Michael Werner, UBS.

Just 2 questions from me, please. First, with regards to kind of the change in resourcing towards India and Philippines, what percent of your headcount is currently based in those 2 countries? And ultimately, where do you think that can go in the next 3 to 5 years? And then just quickly on the active ETFs. I was just curious to see what the fee margins on those products were relative to like-minded non-ETF active strategies.

On the first question, Michael, and thanks for asking in terms of resources, in the 2 regions, India and Philippines, it's currently about 1,100 of our employees.

And do you guys -- do you know where that can go? I think that's what, maybe 1/4 or so of your total headcount or...

At the moment, yes.

I mean I think it can grow. It's not going to be half of our workforce because we're probably not going to like stand-alone operate or sell assets in those countries. But I think it can probably go up 30%, I would imagine, right? So it kind of being maybe 1/3 of our total workforce. That's probably what I could see, which would be in line with resourcing the corporate bank, for example, when you look at kind of the tech and ops folks.

And again, I think the level -- so the competency of people we get there is excellent, especially if you don't treat it as a like offshore outsourcing, but really as a super significant value creator for the global franchise.

On active ETF, obviously, you see the margins. So I guess your question was versus similar strategies. We've chosen to not cannibalize successful active strategies yet, right?

Maybe that will come at some point, but it's essentially new offerings where we didn't have active strategies. So therefore, it's not quite comparable. As you would imagine, it would be lower, right? I mean when I say a fraction, it would be maybe 1/3, maybe half of comparable active strategies. But again, I think something where if as the market grows overall, this is going to be a more relevant part of our franchise.

Thank you, Mike. Which I think was the last question. So before I hand over back to Oliver. So is there one last question? Okay. But can I say something?

Sorry, the sometimes live TV, the -- thanks for all the questions. Allow me to make one comment. It's a passionate comment given that I'm overseeing alternatives myself. I understand that you view performance fees as lower quality than management fees. So I get that. I'm not trying to argue that this is much better than management fees.

I can just tell you, we work really, really, really hard to get those low-quality revenues, and we'll have more of that going forward. So I think you may want to just take a look at P2 continuing to paying performance fee in '26, I would say, at least in line with '25.

When you look at our performance fees, let's say, in 2021, which were over EUR 200 million when the real estate was kicking in nicely, why wouldn't we have that as a base?

So when we said that we had 4% to 7% of revenues going forward, this is not just coming from one strategy. So yes, we have Kaldemorgen every year.

We have the infrastructure business, but private credit, real estate coming back and a few other things are all essentially a diversified source of performance fees. So I would just ask you to -- in follow-up as any question you may have on performance fee, but I think that this is something which you will see as a steady recurring source of revenues for DWS in the future. And with that, I wish you a happy summer, but back to the operator. Thank you, everyone.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Oliver Flade for any closing remarks.

Yes. Thank you all for joining today and for the continued interest in DWS. I mean, as you have seen, our Q2 results highlighted the resilience of our business. And I think a very challenging environment and also reaffirmed the solid progress that we are making towards our 2025 financial goals and beyond. And with that, I wish you all a great summer. Thanks again, and we're looking forward to catching up during upcoming roadshow meetings, conferences and other IR activities. Have a good day. Thank you. Bye-bye.

Thank you.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

[Presentation]

Shareholders, ladies and gentlemen. On behalf of my colleagues on the Supervisory Board, I would like to welcome you very warmly to today's Annual General Meeting for DWS Group GmbH & Co. KGaA. This Annual General Meeting is my 1st AGM as Chairman of the Supervisory Board of DWS.

It has been my pleasure to perform this role throughout my first year, and I would like to thank you all shareholders once again for the trust placed in me by electing me to the Supervisory Board at last year's Annual General Meeting.

I am particularly grateful to my predecessor, Karl von Rohr, for his fantastic support throughout the transition. Special thanks once again to my other colleagues on the Supervisory Board, who elected me as Chairman, a clear indicator of their confidence in me from the start. Over the past 12 months, our efficient teamwork has helped DWS to gain new grant. I will come back to the progress that DWS has made during this successful year later on.

I would also like to commend the Executive Board for their cooperative and transparent partnership over the past year. Moreover, the Executive Board was instrumental in turning the spotlight back on to the fund business in 2024. And last but not least, I would like to thank the Deutsche Bank Management Board member responsible for DWS, James von Moltke, for his commitment and excellent collaboration on the joint committee.

But let me now come back to today's AGM of DWS, which I hereby open.

Ladies and gentlemen, before turning to the contents of my speech, let me, first of all, briefly take you through the formalities required at an Annual General Meeting. The Annual General Meeting was convened in proper form and in due time with the publication of the agenda in the Federal Gazette of 30th of April 2025.

All members of the Executive Board of the General Partner are present here today. Although not all of them are invited here on the spot. These are Stefan Hoops; Markus Kobler, who is unable to be with us today due to illness, but is joining us via video; all the best. Rafael Otero, Karen Kuder, Dirk Goergen, and Manfred Bauer.

I am pleased to welcome you all in person here. With the exception of Angela Meurer, who unfortunately is also unable to be with us today due to illness, all members of the Supervisory Board are also personally present here today. For the shareholder representatives, these are my deputy, Ute Wolf, Karl von Rohr, Margret Suckale, Aldo Cardoso, Kazuhide Toda, Richard Morris, and Christina Bannier.

And for the employee representatives, Erwin Stengele, Christine Metzler, and Stephan Accorsini. Let me also welcome all of you very warmly.

Moreover, on your far right, we have our notary, Dr. Habetha. He will be taking notarized minutes of today's Annual General Meeting.

The list of attendance is currently being drawn up. I will announce attendance once the list will have been completed. The attendance area covers Congress Center at the Frankfurt's trade fair grounds. This is where the studio and the back-office facilities are located and where the counting of votes will take place later today. This is also where the company's proxy is located.

The agenda with the wording of the proposed resolutions is on display here. In addition, the notary has a copy at hand. The full wording of the agenda is also available on our website.

A live audio and video broadcast of the entire AGM will be available on our website today. This means that both our shareholders and interested members of the public can follow the broadcast. A recording up to the end of the speech by the Chairman of the Management Board will also be available on our website after the Annual General Meeting.

Ladies and gentlemen, so much for the formalities. Let me now turn to the reports of the Supervisory Board on its activities in the past financial year. To ensure the effective performance of its function, both in the plenary meetings and the committee meetings, the Supervisory Board receives regular reports and specific updates as and when appropriate, particularly from the members of the Executive Board. We are informed about the company's business development and strategy, corporate financial and human resources planning, profitability, as well as its risk, liquidity and capital management activities.

The main activities of the Supervisory Board in financial year 2024 are covered in detail on Pages V to XIII of our Annual Report 2024. I would, therefore, like to highlight only some of the topics we did with at this point.

The Supervisory Board and its standing committees had a total of 27 meetings last year. The average attendance rate was more than 95%. The full Supervisory Board met 10 times.

In addition to monitoring day-to-day business operations, our primary task here was to advise the Executive Board on the implementation of the strategic core projects.

Specifically, these projects included DWS' growth strategy, its market position in Europe, the Americas, and Asia Pacific, plus the multiyear transformation program.

Together, the Supervisory Board and the Executive Board concentrated on implementing this strategy, thereby researching the related trends, risks and opportunities. As in previous years, we also held a 2-day strategy offsite last August. It was attended by the Supervisory Board, the Executive Board, representatives of the extended leadership team, and the Deutsche Bank AG Management Board member responsible for the Asset Management division.

We deliberately placed a strong emphasis on strategy and growth discussions. During the meeting, we intensively discussed value-generating inorganic growth opportunities. We looked at developments in our active funds and alternative investments as well as our Xtrackers business. We chase the progress of our digital assets and examines our wholesale and institutional strategy more closely.

Our sustainability strategy and data strategy were further subject of debate. We'd also discussed our strategy in Europe, APAC, and America with our regional experts.

Last year, we focused in particular on considering the strategic risks that are relevant to us. Other topics included IT and our employee strategy. In 2024, the sustainable profitability of our business and the cause for further future growth were the priorities for us on the Supervisory Board. Accordingly, we engaged in a thorough examination of the company's strategic development, which encompassed both organic and inorganic growth opportunities.

Apart from strategy topics, we continue to continually work on systematically refining our internal control processes. Control topics are an essential part of all our Supervisory Board meetings. Moreover, the Supervisory Board, closely monitor the ongoing ESG investigations by the public prosecutor's office in Frankfurt over the last year.

The AdHoc Committee provided us with comprehensive insight into the status of the ongoing investigations and the further courses of action planned. The Supervisory Board welcomes the fact that the investigations against DWS have now been concluded, which means it can now focus its efforts on moving forward.

I would now like to address three of the items on the agenda for today in greater detail: Firstly, the election to the Supervisory Board under agenda Item 7. Secondly, the resolution on the approval of the compensation system for the managing directors of the general partner under agenda Item 8. And thirdly, the decision on the remuneration of the members of the Supervisory Board under agenda Item 9.

Please allow me to briefly run through the current developments regarding the composition of the Supervisory Board. Supported by the recommendation of the shareholder representatives on its Nomination Committee, the Supervisory Board decided to propose Tomohiro Yao for election as shareholder representatives to the Supervisory Board under agenda Item 7 at the AGM. Mr. Yao has been nominated as Mr. Toda has decided to resign from the Supervisory Board upon the close of today's AGM.

I would like to take this opportunity to thank Mr. Toda for his excellent constructive work on our Supervisory Board. Time and again, he has enhanced the Supervisory Board with his strategic advice and global expertise.

Mr. Yao, will briefly introduce himself as the new candidate for the Supervisory Board later on. At this point, I will therefore only review this much. Mr. Yao is currently Executive Officer and Head of Americas as well as Head of Europe at Nippon Life Insurance Company. He brings a wealth of experience in a wide range of roles at Nippon Life. Moreover, he has been extensively involved in committees through various Board appointments on other supervisory committees in the Asia Pacific region, the U.S. and the U.K.

The external mandates included Mr. Yao's CV, our non-executive directorships for unlisted companies that are directly related to his activities at Nippon Life. What's more? Mr. Yao has known DWS for quite some time. We are confident that we have found an outstandingly qualified candidates to complement our Supervisory Board. Therefore, I'm very much looking forward to welcoming Mr. Yao as a member of the Supervisory Board and wish him every success in his role at this point.

Ladies and gentlemen, let me now come to the second of the previously mentioned three agenda items. The compensation system for members of the Executive Board was last ratified in the Annual General Meeting in 2021 and has not been amended significantly since then. In line with statutory requirements, we will be submitting the system for your approval this year. The system was reviewed at the shareholders' meeting of the general partner in consultation with the joint committee and with the support of an external consultant who supported these activities.

Current market practice and market trends as well as the relevant regulatory requirements and investors' expectations were all taken into account. As the previous system had proven robust, only minor changes were made. The emphasis was placed on more fully reconciling the interest of shareholders and the Executive Board. The system has also been simplified.

Regarding the long-term variable component, the earnings per share growth rates is introduced as a new target. Net flows, now in the form of a long term net flows and the cost-to-income ratio, now in the form of the reported cost-to-income ratio remain key financial targets.

Transparency is thus enhanced by aligning performance criteria with external reporting. Sustainability goals continue to make up a relevant part of the long-term targets. They are being updated in accordance with the objectives of the strategy.

The number of targets in the short-term variable components will be reduced in order to enable more focused targeting. The system thus continues to be a key factor in facilitating and implementing a long-term DWS strategy in accordance with your interests as shareholders. And it should continue to enable competitive and market-oriented remuneration in the future.

Further details on the compensation system can be found in the explanatory notes on agenda Item 8 in the invitation to our Annual General Meeting as well as online on the Annual General Meeting page on the company's website. The compensation system will be applied in this financial year, and we kindly ask you for your approval.

This takes me to the third and last of the three agenda items mentioned beforehand. As you have already seen on the agenda Item 9, the Supervisory Board remuneration package is to be increased as appropriate and a market-oriented attendance fee introduced for meetings.

In the past 7 years, since DWS' IPO in 2018, the remuneration of the Supervisory Board members has not been updated. However, the Supervisory Board's compensation package must be adjusted in order to attract highly qualified candidates on the international stage.

In addition, the demands placed on Supervisory Board members in terms of time commitment and accountability have increased substantially in recent years. An independent external remuneration adviser proposed the increase and confirmed it was proportionate. In the first quarter of this year, he carried out a peer group comparison, which examined the remuneration paid at DWS in relation to that of its competitors.

Further details on the compensation system of the Supervisory Board can be found in the explanatory notes on Agenda Item 9 in the invitation to our Annual General Meeting. The General Partner and the Supervisory Board propose to adopt the amendment to the Articles of Association required for the adjustment.

Ladies and gentlemen, this takes us back to the activities of the Supervisory Board. As every year, the Supervisory Board also deals with the dependency report, which lists the company's relationships with affiliated companies and thus with Deutsche Bank. This dependency report was prepared by the Executive Board and audited by KPMG as the statutory auditor.

KPMG did not raise any objections and issued an unqualified audit opinion. The wording of the audit opinion can be found on Page XIII of our Annual Report 2024. Moreover, KPMG has audited the annual financial statements and the consolidated financial statements as well as the summarized management report for the annual and consolidated financial statements for financial year 2024, issuing an unqualified audit opinion in each case. Its wording can be found starting from Page 200 of the Annual Report 2024 in the German version.

The Supervisory Board has also reviewed the annual financial statements and consolidated financial statements drawn up by the Executive Board, along with the dependency report. Based on the recommendation of the Audit and Risk Committee and following an in-depth discussion with the representatives of the statutory auditor, KPMG, we unanimously approve the annual financial statements as well as the consolidated financial statements.

The review of the dependency report and the audit report of the statutory auditor KPMG did not lead to any objections. Likewise, there were no grounds for objections to the final declarations of the Executive Board.

Ladies and gentlemen, let us now move on to the activities of the various Supervisory Board committees. The Audit and Risk Committee met a total of 10x under Ms. Wolf as Chairperson. It supported the Supervisory Board in monitoring the control, reporting and accounting processes and addressed intensively the annual financial statements and consolidated financial statements as well as the interim reports and the report issued by the statutory auditor.

In this context, the committee reviewed the valuation of goodwill and other intangible assets as well as the service fees charged by Deutsche Bank AG and its subsidiaries and related governance processes. The committee also monitor the effectiveness of the risk management system, in particular with regard to the internal control system and internal audit, while taking account of our multiyear transformation program.

Furthermore, the committee examined the group's risk appetite statement and the overarching risk strategy, which is embedded in the risk management framework. This also includes the integration of sustainability risks into the framework. Therefore, in 2024, the committee also turned the spotlights on to the CSRD, that is the EU's Corporate Sustainability Reporting Directive. Moreover, the Audit and Risk Committee held a number of extraordinary meetings. These focused, in particular, on the discussion of audit findings, the CSRD reporting and the EU taxonomy regulation.

For financial year 2024, the Audit and Risk Committee also recommended a renewal of the audit engagement of KPMG. The deliberations took into account the results of the review of the statutory auditor's independence, which did not identify any indications for any risk to independence.

Another central topic discussed by the committee was the proposal to be discussed on the Agenda Item 5 regarding the selection process of the auditor of its annual and consolidated financial statements as well as the auditor for its sustainability reporting.

For financial year 2025, the Audit and Risk Committee recommended engaging KPMG to audit the annual financial and consolidated financial statements. KPMG is also to be appointed to carry out the audit review of the condensed financial statements and interim management report as of 30th of June 2025. And if applicable, other intra-year financial information prior to 31st of December 2025.

This is different for an audit review of any other financial information generated during the year with effective dates after 31st of December 2025, provided this is established before the ordinary Annual General Meeting 2026.

To this end, the committee recommended that the Supervisory Board propose EY as auditor to the Annual General Meeting. This proposal which the Supervisory Board has adopted with its proposal to the AGM is the result of a selection process conducted by the Audit and Risk Committee.

With the entry into force of the law implementing the aforementioned EU CSRD directive into German law, KPMG is to be appointed as independent auditor to confirm the sustainability reporting for financial year 2025.

Nonetheless, the Supervisory Board should only implement the resolution in the event that the CSRD implementation act requires that the sustainability reporting to be produced for financial year 2025 be confirmed externally by an auditor to be appointed by the Annual General Meeting.

Ladies and gentlemen, the Remuneration and Personnel Committee chaired by Ms. Suckale held five meetings in 2024. It monitor the appropriate structure of the compensation systems for employees and key risk takers who have a material influence on the overall risk profile of the group.

In addition, the committee reviewed corporate culture and was regularly informed about significant regulatory requirements and the impact on the group's compensation framework. The committee also took account of changes in regulatory requirements by amending its rules of procedure.

The Nomination Committee held two meetings in 2024. In the first half of the year, the committee was chaired by former Chairman of the Supervisory Board, Karl von Rohr. Upon my appointment in June of last year, I took over chairmanship.

As in previous years, the Nomination Committee carried out an efficiency review in 2024. In doing so, the Nomination Committee prepared the self-assessment of the Supervisory Board. Moreover, it's annualized, in particular, the results of this evaluation, identifying focus areas and recommending possible measures to the Supervisory Board. As in prior years, a neutral external adviser supported the over process. Details on the activities of the committees can be found on Pages IX to XI of the Annual Report.

Let me now outline the activities of the joint committee in the past finance year. You can find more detailed information on this starting on Page XVI of our Annual Report. The joint committee met five times in 2024. In accordance with its statutory duties in powers, the committee discussed in-depth variable remuneration, the compensation structure and individual targets for the Managing Directors of the General Partner. The joint committee submitted proposals on variable remuneration to the shareholders meeting of the General Partner. It is responsible for defining the compensation of the managing directors and has followed these proposals.

As mentioned earlier, the committee also carried out a review of the compensation system for the Executive Board. The committee also dealt with the contract extension of Stefan Hoops, which the joint committee supported due to his performance delivered over the last few years.

The committee also discussed the planned appointment of Rafael Otero as a member of the Executive Board and new Chief Technology and Operations Officer effective 1st of October 2024, as well as the contract extension of Dirk Goergen. In the financial year under review, the Joint Committee also extended the contract of Karen Kuder for a further 3 years.

Ladies and gentlemen, like the Supervisory Board Committees, the compensation of the joint committee has not been adjusted in the 7 years that have passed since the IPO in 2018. The General Partner and the Supervisory Board, therefore, propose that the respective amendment to the Articles of Association be adopted under Agenda Item 10 in order to adjust the remuneration of the members of the joint committee. The amendment takes increased workloads and the risk profile of the committee into account.

Ladies and gentlemen, following these remarks, most of which are required by law, let us now move on to the higher-level business issues. Since our last Annual General Meeting, DWS has continued to make good headway in implementing its strategy.

Let me share a few key examples with you. In its growth area of Passive including Xtrackers, DWS sets a new record in net flows of approximately EUR 42 billion in 2024, thereby exceeding the previous all-time high achieved the year before in exchange-traded products, especially ETFs. Investment in this growth segment clearly pays dividends.

In its other growth category, Alternatives, DWS recently entered into an important partnership with Deutsche Bank. Together, our goal is to develop private lending and investment opportunities for DWS clients in the private credit sector. This measure aims to accelerate growth in Alternatives.

In addition, DWS has completed its multiyear transformation program. With this approach, we focused our efforts on providing stand-alone solutions in those areas that are differentiating factors for us as an asset manager. At the same time, we continue to take advantage of expertise, purchasing advantages and economies of scale in some IT areas by partnering with Deutsche Bank.

And last but not least, in March 2025, DWS was admitted to the index, the German index that tracks mid-cap companies. The move from the SDAX followed the rise in DWS' share price, which also reached a new high in the first quarter of 2025. Stefan Hoops will present the progress delivered by DWS and implementing its strategy to you in greater detail in a moment.

Ladies and gentlemen, the results of the past financial year also speak for themselves. DWS was able to double its long-term net flows year-on-year. This is impressive evidence of its strength to grow organically. Along with the positive market environment, this helps take assets under management to a new record level. At the end of last year, for the first time, we crossed the EUR 1 trillion threshold. This also enabled DWS to achieve a new record in revenues while significantly improving both profit before tax and net income.

In view of the strong financial results in 2024, we propose a further increase in the ordinary dividend. More specifically, for the sixth year in a row to EUR 2.20 per share.

DWS also got off to a successful start this year. Not only did report high long-term net flows in the first quarter, the company set a new record for total net flows in 1 quarter. What's more, it posted the second best quarterly result since its IPO 7 years ago.

Ladies and gentlemen, the outstanding results for the past year and the first quarter of 2025 are testament to the exemplary work of our Executive Board under the chairmanship of Stefan Hoops. I would like to thank the entire Executive Board, and in particular, all DWS employees around the world on behalf of the full Supervisory Board.

These results go to show that extending Stefan Hoops contract for a further 3 years until 2028, as I said earlier, was undoubtedly the right decision. Since taking over DWS in 2022, in the challenging environment, he has restored confidence in our company and set us back on the right track. As a result, DWS is now well positioned for the future. I would also like to take this opportunity to express my sincere thanks to Mr. Hoops for this.

Ladies and gentlemen, the new U.S. administration's tariff policy has caused the environment to take a turn for the worse in the current quarter, sending uncertainty soaring. This applies both to economies around the world and to asset managers.

Nevertheless, with its diversified business model, which has proven effective time and again in the last few years and the management team headed by our CEO, Stefan Hoops, DWS is in a strong position to offer clients the right products and reach its targets for 2025 despite the turmoil on the financial markets. The Supervisory Board will continue to oversee the management's activities with critical diligence, while also providing its considered guidance.

Shareholders, our CEO, Stefan Hoops, will now present the strategic alignment of DWS and tell you more about its business developments. Thank you very much for your kind attention.

Thank you very much, dear Oliver Behrens. Ladies and gentlemen, dear shareholders, I too should like to welcome you on behalf of the entire Executive Board to this ordinary Annual General Meeting of DWS Group. This Annual General Meeting is rather special because it's not only the 7th such meeting since the IPO, but also, and I say this with great pride, the first AGM in which DWS is listed in the MDAX.

In March, we were admitted to the select circle of Germany's top 50 mid-cap companies. This promotion to the stock exchange's second division shows how attractive our company is, and it is also a testimony to your confidence and support on the journey so far. I would therefore like to take this opportunity to say a heartfelt thank you.

Permit me to spend the next few minutes outlining our journey in 2024 to reach this milestone in our history. In so doing, I shall give an account of the financial year 2024 and report on the progress made in implementing our strategy and where we stand at present. I should then like to take a brief look at the first part of 2025, giving the outlook for the rest of the year and beyond. After all, following a turbulent start to the year in politics and on the markets, you will understandably wonder how DWS views the coming months.

Ladies and gentlemen, last year, I was able to report on the AGM on the successful turnaround of net inflows in 2023. This positive development continued and even accelerated during the past financial year. In 2024, we doubled our long-term net inflows, excluding cash products and advisory services to EUR 32.9 billion.

Net flows in Passive, including Xtrackers, set a new record. Moreover, we had net inflows in active SQI, that is systematic and quantitative investments. And, ending a lengthy lean spell for Alternatives, the second half of 2024 saw positive overall net inflows in this part of our business too.

Our strong net inflows helped to increase assets under management by EUR 115 billion in 2024. That takes us to yet another milestone. In December 2024, our assets under management crossed the EUR 1 trillion threshold. The stable stock market in 2024, paired with strong net inflows and a higher average volume of assets under management, resulted in management fee growth. But that is not all. Thanks in part to higher performance fees, revenues rose to a new record high of EUR 2.765 billion.

In this connection, something that my fellow Board members and I find very important is that good revenues have not resulted in cost discipline being relaxed. On the contrary, in the past financial year, we succeeded in slightly reducing costs with total expenses amounting to approximately EUR 1.8 billion.

We had confirmed our cost objectives for 2024 at the start of the year, specifying that we wanted the adjusted cost-to-income ratio to be between 62% and 64%. At the end of the year, the ratio stood at 62.3%, close to the lower end of the range.

Revenues up, costs under control, as a result, we achieved a 22% increase in profit before tax in the past financial year, reaching EUR 951 million. Even after tax, growth was 18%, and the net income amounted to EUR 649 million. Earnings per share grew from EUR 2.76 in 2023 to EUR 3.25 in 2024.

Ladies and gentlemen, the financial success of 2024 would not have been possible without the continued trust of our clients and the performance of our company and the people behind it. Therefore, personally and also on behalf of my colleagues, I should like to give a warm thanks to all our clients. Their financial success and satisfaction is our top priority. Day by day, it is what motivates us to be worthy of their trust.

At the same time, also on behalf of the DWS Executive Board, I should like to thank our employees for their great dedication, performance and passion and for the uncompromising commitment to our clients last year. They are the people who work every day to generate value for our clients and thus also for you, our shareholders.

And naturally, ladies and gentlemen, we should also like to thank you for the confidence placed in us. On the basis of the strong financial results and in line with our commitment to create value, we propose a higher ordinary dividend of EUR 2.20 per share for the year 2024. This represents the sixth consecutive annual increase. We consider this dividend in conjunction with the extraordinary dividend paid last year and the significant rise in our share price to be clear evidence that shareholder value is a top priority for DWS.

The basis for a successful shareholder value strategy is reliable communication with the capital markets and with the general public. This also involves regular transparent reviews of where we stand in relation to our short- and medium-term goals.

Let us start by looking at the financial objectives. At our Capital Markets Day in 2022, we outlined the following aims for the financial year 2025: Earnings per share of EUR 4.5, an adjusted cost-to-income ratio lower than 59%, equivalent to a non-adjusted cost-to-income ratio of less than 61.5% and a dividend payout ratio of about 65%. At the beginning of this year, we reaffirmed these objectives. I shall come back to this point later in my speech.

Ladies and gentlemen, at last year's Annual General Meeting, I also talked about three short- and three medium-term aspirations, which we formulated at the start of 2024. In the short term, our goal was to swiftly and quietly resolve our internal challenges, continue delivering strong organic growth and generate alpha for our clients and investors. In the medium term, we want to establish DWS as the "Gateway to Europe" for international investors, to be one of the top 5 foreign asset managers in the world's five major economies and to play a role in shaping the future of finance.

Allow me to provide an assessment of our current position in light of these ambitions, acknowledging, of course, that this view may carry a degree of personal perspective.

I will begin with the desire to resolve our internal challenges as quickly and quietly as possible. Last year, I told you that we were on the home stretch of our transformation program, which had a time scale of several years. I indicated we would focus on those services and skills, which would make us more competitive in the asset management industry. This process is now complete, as is the adoption of a hybrid model for our IT.

As described then, we continue to benefit from economies of scale in certain IT areas by partnering with Deutsche Bank. At the same time, we are building and expanding our own capabilities wherever that will make us more competitive. For example, with the view to DWS cloud solution. This element in the reduced category of our strategy will be completed by the end of the year, although continuous development of IT systems will obviously be an ongoing task.

Another issue, one which attracted a great deal of public attention was finally solved by the end of the first quarter of 2025. Here, I refer to the investigations conducted by the public prosecutor's office in Frankfurt related to ESG. This case, which has been an issue for nearly 3 years, was closed in early April.

The Frankfurt public prosecutor's office found that a negligent oversight infringement had occurred and DWS has accepted a fine imposed. The deficits identified concern documentation and control processes, procedures and marketing statements relating to ESG. These are exactly the points that in the past we had repeatedly conceded in public.

Over recent years, we have taken determined steps to address these weak spots and are continuously improving our internal documentation and control processes. We are pleased to have been able to settle this matter. My thanks go to the team of colleagues from the legal department and other specialist sections who have worked so hard in the past years on resolving this issue and on putting necessary procedural improvements in place.

I believe that in this context, one thing is especially important. Even though we have resolved the issue in view of a permanently changing regulatory environment, it is the duty of each and every one of us to continue efforts to further improve our control and documentation processes.

Ladies and gentlemen, permit me at this point to digress a little. Sustainability remains a highly relevant topic for us. Not only because science has convinced us that climate change is real and the economy and society must adjust to the situation and adopt countermeasures, but also because we have a fiduciary obligation to offer our clients the best possible wealth strategies, while keeping an eye on the long-term risks and opportunities.

However, times have changed in respect of regional regulatory differences and also with regard to client preferences. In particular, I'm thinking here of the climate policies and regulatory framework of the U.S. administration, which create increasing legal implications and risks for companies in which we invest. Against this backdrop, we have further developed our sustainability strategy, which I sketched out 2 years ago.

Our commitment remains unchanged. We aim to offer investment expertise and strategies, which enable our clients to cope with the sustainable transformation of the real economy. Our activities in this sphere confirm to our fiduciary principles.

In this context, it is important to understand exactly what our fiduciary obligation entails. We are guided by the investment aims and decisions of our clients who have their own interest and key criteria. Therefore, we offer a wide range of investment strategies so that our clients can build long-term wealth. That includes strategies which promote sustainability and also those which serve conventional objectives.

To put it in another way, in the past, DWS has never dictated to any client what strategy they should pursue when investing their money. And we will not do so in the future either. We offer Alternative products oriented to sustainability goals. But at the end of the day, our clients by choosing a product decide to what extent they wish to take environmental, social and governance aspects into account when investing their money.

For our own part, as a company with a sense of responsibility, our aim remains to contribute to a more sustainable future. This means managing the environmental effects of our operational activities and through training and social commitment involving our employees in the advancement of a more sustainable corporate practice. Beyond that, our long-term sustainability indicators play a role in our financial incentives systems.

In view of the dynamically changing political and regulatory issues, we shall continue to develop our sustainability processes and activities and adjust them to meet the new framework conditions.

Ladies and gentlemen, I now return to the report on how we met our short- and medium-term ambitions in 2024. Our second short-term objective was to continue to deliver strong organic growth in 2024. I have already spoken of our progress in this area. The more than 10% increase in assets under management to over EUR 1 trillion during the financial year 2024 is a remarkable result that compares very well with other players in the field.

The last short-term objective, generating alpha for investors and clients presents a more mixed picture. We are very pleased that we were able to generate alpha for our investors, as you doubtless already know from our previous remarks. Since 2022, your DWS has delivered a total shareholder return of close to 100%. This placed us well in front of our competitors in Europe and overseas, as well as ahead of all relevant share indices. Our promotion to the MDAX, mentioned before, is the reward for your company's clear orientation towards shareholder value.

And almost by the way, we reached another milestone in February 2025, when our share price rose past the EUR 50 mark. DWS has thus a market capitalization of more than EUR 10 billion.

However, the picture is not complete without mentioning that we cannot be completely satisfied with the performance of some investment strategies and product solutions, above all, not with the relative performance in the past year.

Accordingly, we have taken action. In November, we appointed the head of our investment platform, Vincenzo Vedda, as Chief Investment Officer. He has taken over the Chief Investment Office and already started on the task of integrating portfolio management with the Chief Investment Office and Economic Research. Initial successes have become apparent in this year's current market environment, in which the CIO team's diversification drive is delivering results. The active strategies of DWS have developed better over recent months. Not least, thanks to their more defensive positioning.

Ladies and gentlemen, our three medium-term aspirations also made good progress in 2024. I shall return in a moment to our promise to become the Gateway to Europe that will allow international investors access to European transformation. To fulfill our ambition to be one of the top 5 foreign asset managers in the world's five major economies, we are focusing above all on Asia.

Here, we are concentrating in particular on strong regional partnerships and strategic investments. In Japan, where this year marks our 40th anniversary in the country, we delivered the strongest net inflows since our IPO last year. We continue to see great potential in the country and are profiting from our strong partnership with Nippon Life. As you know, in 2023, we extended this partnership for another 5 years.

In China, we can build on our investment in Harvest Fund Management, in which we have held a 30% stake for several years. This investment reliably delivers returns. As communicated in the past, we are keen to do more in China.

India is a highly interesting developing market for asset management. Here, our objective is a strategic partnership. In view of the aforesaid, we remain optimistic that over the course of the decade, we will succeed in fulfilling the stated ambition to be one of the top 5 in the top 5.

Our third medium-term aspiration was to help shape the future of the financial industry. Two things are necessary here. On the one hand, suitable products and the corresponding link up with new digital distribution partners in order to gain clients among the digital natives who make their own investment decisions. On the other hand, we also need to build proprietary know-how and knowledge in order to be prepared for changes in our industry's value chain that will arise from the increased use of blockchain technology.

I'm pleased to be able to report that we have made progress here that gives a reason for optimism. In April 2024, we set up our Xtrackers ETCs for Bitcoin and Ethereum in order to facilitate safe access to cryptocurrencies for our clients.

At the same time, we have made good progress with our AllUnity joint venture, operated in collaboration with Flow Traders and Galaxy Digital. AllUnity will probably issue the first euro stablecoin on the market subject to regulatory oversight from BaFin in 2025.

In addition, we shall continue to develop capacities and interfaces to attract digital platforms such as neo-broker. Over recent months, we have been able to expand our partnerships with leading providers. The outcome in 2024, some 30% of our Xtrackers inflows already came via these channels.

Ladies and gentlemen, to sum up the year 2024, I should like to say that we are content, but we are not self-satisfied. Last year, we took some major steps towards fulfilling our medium-term aspirations. And we have also laid the foundation on which we can attain our ambitious financial aims for 2025. But we still need complete commitment to achieve these goals. That was also evident at the start of this year.

Ladies and gentlemen, we succeeded in maintaining the momentum of 2024 in the first quarter of 2025. Net inflows, including cash products and advisory services totaled EUR 19.9 billion, setting a new DWS record. Once again, this was mainly driven by Passive including Xtrackers with the support of good inflows into active SQI and active fixed income.

Long-term net inflows, excluding cash products and advisory services, comprised the handsome sum of EUR 11.7 billion. In a market environment, that was already volatile and marked by geopolitical uncertainties, the long-term assets under management slipped by 1% quarter-on-quarter to EUR 891 billion.

In the first quarter, we could not fully compensate exchange rate movements and faltering markets. In contrast, overall assets under management remained stable and at EUR 1.01 billion, close to the record levels seen in the prior quarter.

In a challenging market environment during the second quarter, assets under management had by the end of May, returned to approximately the same level as at the year-end 2024. However, the ongoing uncertainties on the market have tended to influence client behavior impacting net inflows. Currently, we are expecting the long-term net inflows in the second quarter to be about half as high as they were at the start of the year. More details on this topic will be contained in our media release for the second quarter to be published on 24th of July 2025.

Dear shareholders, you all know that with hindsight, the year 2024 and the first quarter of 2025 belong as it were to a different era. I refer, of course, to the impact of President Trump's self-declared Liberation Day at the beginning of April, when he shook global capital markets with comprehensive swipe at customs tariffs.

Since then, we have witnessed geopolitical uncertainties, the announcement of tariffs and counter-tariffs, their suspensions and exceptions and the conclusion of trade agreements, which are at best, open to interpretation. All these events have put added pressure on already volatile markets and rattled market players.

There is a question mark hanging over the long-term effects on, for example, the roll of the U.S. dollar as reserve currency and over which economic and geopolitical alliances will emerge in the future. Consequently, the mood of investors remains cautious. And our industry, thus is entering a more complex and more difficult phase. The times when asset managers could rely on a comparatively comfortable market beta are over.

Ladies and gentlemen, in such an environment, it is of little use to concentrate too hard on certain index levels or yield forecasts. The markets are driven by contradictory fast-moving forces making every base scenario just one of many possibilities.

So what does an asset manager need in order to create alpha in such a market, in other words, to deliver to their shareholders added value relative to the market's overall development?

Our view is that diversification and discipline are more important than ever. But something else is increasingly making a difference. It is the ability to offer a credible alternative to American competitors. And exactly that is a strong point of your DWS.

Let's talk about diversification. DWS is one of the most diversified global asset managers in terms of our products, client groups and the regions in which we are active. As one of only a few global providers, we manage assets in excess of EUR 100 billion in each of the following categories: Active Equity, Active Fixed Income, Active Multi Asset and SQI, ETFs and Alternatives.

This volume across such a wide spectrum of asset classes is our distinguishing feature. It means that we are not dependent on a single type of asset. It keeps us resilient even if markets change or our clients develop different needs.

Our client base is a balanced mix of wholesale and institutional investors, and we are not dependent on the so-called captive distribution. That is a sales organization that sells our own products only. In a world in which partnerships can change rapidly, this independence eliminates event risks and gives us greater control and flexibility.

I have already mentioned our regional ambitions. We are growing in regions of rising prosperity and our partnerships contribute to a stronger local presence. Thanks to this local expertise, we can adjust to a region's regulations and the expectations of its clients while remaining part of a global network.

Let's talk about discipline. In an environment in which revenue growth is becoming increasingly volatile due to investor caution, a stringent cost structure is vital. We have rigorously controlled our costs over recent years. In so doing, we have delivered a good cost-to-income ratio that is better than most competitors' figures.

Moreover, we are one of the few global providers on a market that is not currently engaged in restructuring or post-merger integration. And as mentioned before, last year, we completed our transformation program. That means that we can now concentrate fully on the implementation of our strategy and on growing our business. And thanks to the good cost-to-income ratio, every increase in revenue can make a significant contribution to our financial results. So much for the basics.

Ladies and gentlemen, earlier, I mentioned our medium aspiration to be perceived by international investors as their Gateway to Europe. I have also briefly touched on the effects on the global economy of decisions made by the President of the U.S.

In this context, our identity as a European asset manager with deep roots in Germany is something we must make the most of, along with our skills in bringing perspectives together in a global context, because the way people view Europe is changing sustainably.

Only a few months ago, global investors regarded Europe with a mixture of skepticism and disinterest. Low growth prospects, concerns about stability and fiscal unity, paired where the infamous European bureaucracy and national interests have tended to frighten investors away. But the geopolitical pressures of the past few weeks have brought about European reforms that probably would not have happened otherwise. The most relevant aspects are reversible decisions that are leading the continent and above all Germany down a different economic path than hitherto.

I refer here to the so-called debt break or balanced budget law, now revised to exempt defense spending from its restrictions. And I also refer to the EUR 500 billion special fund for infrastructure projects.

In his first speech laying out the government's agenda, Federal Chancellor, Merz, reemphasized that state investment should also mobilize private capital.

This is the right course. Why? Because it generates fresh momentum on the domestic market. It strengthens and channels popular desire for transformation and the vision for the future. And last but not least, it encourages international players to invest more in Europe.

At present, we are witnessing a repatriation movement as European wealth is being withdrawn from the U.S. to flow back to the old world. At the same time, talks with the international clients, especially those in Asia and the Middle East indicate that they are planning to change the allocation of their portfolios as well.

As one of Europe's leading asset managers and the undisputed #1 in Germany, we are in a strong position to benefit from this momentum. And indeed, talks with these clients reveal that there is a strong demand for our expertise and our ability to connect the dots. That is linking perspectives across regions and asset classes.

Ladies and gentlemen, even if the signs are looking good, the Executive Board still has the important task of regularly checking whether our strategy is still viable or whether we need to make adjustments.

The Supervisory Board, as Oliver Behrens has indicated, has been closely involved in this process in the context of strategy discussions.

The result is that we are convinced that the strategy we presented at the Capital Markets Day in 2022 remains valid and is right for DWS. The major focus sectors remain: Reduce, meaning the ongoing optimization of our setup; Value, meaning our core and active management; Growth, meaning focused investments in growth of the Xtrackers and Alternatives business; and Build, meaning the buildup of forward-looking business areas and the required proprietary knowledge.

However, an unbiased assessment of the situation must include the fact that in some areas, we have not yet fully realized our full potential or have not been able to implement plans perfectly. Consequently, we have defined some focused topics that are to be treated with priority.

One of these is to return to a stronger concentration on the active business, especially in the German market. This is at the heart of DWS, the core of your company throughout its nearly 70-year history. We wish to strengthen and further grow this business.

We want to further address potential in our Alternatives sphere. In the first half of 2025, we agreed to cooperate with Deutsche Bank in the private credit sector, which gives us and our clients preferential access to certain asset-based finance, direct lending and other private credit asset opportunities originated by Deutsche Bank.

Last but not least, we wish to better exploit the potential inherent in offers for our institutional clients. We will tackle these topics with cross-sector project teams and clearly defined responsibilities with regular tracking at board level, in order to steer the future development of your DWS.

Because, ladies and gentlemen, we have reached an important moment in the history of DWS. Over recent years, we have transformed the company and structured it so, that we can concentrate on growth and the implementation of our strategy. We have caught up with competitors, but we have not yet overtaken them.

As I said before, our industry has entered a new more difficult phase. In this phase, we shall see who has done their homework. And in this phase, we shall see who is ready to overtake.

Over the past years, your DWS has worked hard and now has the confidence to say, we are ready, because while we continue to focus rigorously on implementing our strategy for organic growth, we also believe that impending market volatility can offer interesting non-organic opportunities.

When times are stressful for markets, structural weaknesses often become apparent. And as a focused company with a large capital resources, we are in a strong position to take action where others may perhaps encounter difficulties. Therefore, it is important for us to remain able to react with financial flexibility.

Despite the distribution of an extraordinary dividend last year, we still have considerable capital reserves. This puts us in a position to open up new avenues and pursue new opportunities. Rest assured, we will be concentrating on those opportunities that create genuine value for our clients and for you, our shareholders.

Ladies and gentlemen, what does this all mean for our financial objectives? As I already said, we still aim to return earnings per share of EUR 4.5 for the full year 2025. We still consider that to be realistic and achievable, even if the latest market fluctuations have widened the range for potential outcomes. At the start of the year, we also announced medium-term financial objectives, which we should like now to reconfirm.

In 2026 and '27, we are seeking earnings per share growth of 10% per annum. We expect this growth to be driven by rising revenues and ongoing cost management. We also expect to further improve the reported cost-to-income ratio, which we intend to push down to 61.5% by the end of 2025. In addition, we are still aiming for a dividend payout ratio of about 65%.

We are convinced that your DWS will thus be an even more attractive investment in future. We are working all out to achieve this. Thank you for your kind attention.

Thank you, dear, Stefan, for your explanations, which should have given our shareholders a good overview of the current situation of our company.

Ladies and gentlemen, before we move on to the topics on today's agenda, we would like to begin also this year's meeting by remembering the deceased employees and retirees of DWS. For this, I would like to ask you to pause for a moment and ask those present here to rise from their seats, please.

Thank you for this moment of commemoration.

We now come to the attendance at today's Annual General Meeting. Based on the data submitted to me, I can announce the attendance as follows. The company's share capital in the amount of EUR 200 million is divided into 200 million, no par value shares. Of those at today's AGM, 179,339,213 no par value shares are represented -- representing the equal amount of votes. This corresponds to 89.67% of the share capital. Moreover, we have received poster votes in the amount of 64,353 no par value shares. In total, this amounts to 179,403,566 no-par value shares, which corresponds to 89.7% of the share capital.

You can view the list of participants in our access protected shareholder portal. In addition to the votes represented by the company's proxy, the list also includes the shareholders who have joined the meeting electronically and the representatives of shareholders who have joined the meeting electronically. That list is updated from time to time without me announcing the respective changes in attendance.

Shareholders who have properly registered and who have provided proof of their shareholding, can still use the shareholder portal to exercise their voting rights directly by postal vote or can issue powers of attorney and instructions to the company's proxy, and can also change their instructions.

I will inform you in good time of the exact point in time when the opportunity to vote will end. To use the portal, please use the access data on the registration confirmation that was sent to you after your proper registration and proof of your shareholding.

With that, we come to today's agenda, which comprises 11 items. Item 1 concerns the financial reporting of DWS for the 2024 financial year and includes the Annual financial statements and the management report for DWS Group GmbH & Co. KGaA, which were prepared in accordance with the German Commercial Code HGB and approved by the Supervisory Board. And also the consolidated financial statements and the group management report in accordance with IFRS and the report of the Supervisory Board.

Ladies and gentlemen, these documents and the proposal for the appropriation of profits have been available on our website since the convening of the Annual General Meeting on April 30, 2025. Additionally, they have also been available at our headquarters offices.

The annual financial statements and the management report as well as the consolidated financial statements and the group management report were previously audited by KPMG Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, the auditor elected by the Annual General Meeting in 2024. Neither the audit by the auditor nor the audit carried out by the Supervisory Board which also cover the proposal for the appropriation of profits give rise to any objections. The auditor issued an unqualified audit opinion.

The Supervisory Board approved the annual financial statements and the consolidated financial statements at its meeting on 10th March 2025. The adoption of the annual financial statements is the responsibility of today's Annual General Meeting.

And I would also refer you to my introductory remarks on the report of the Supervisory Board, which can be found on Pages VII to XIII of the 2024 Annual Report. The auditors, Mr. Fox and Ms. Adilova from KPMG AG -- from KPMG, are also present here in the attendance area.

The other items on the agenda which are also available in their full wording on our Annual General Meeting website include Item 2, the appropriation of distributable profit. The General Partner and the Supervisory Board are proposing to you today that a dividend of EUR 2.2 per share be distributed from the 2024 distributable profit.

Agenda Items 3 and 4, the formal approval of the actions of the General Partner and the members of the Supervisory Board for the 2024 financial year.

Item 5, the election of the auditor and the group auditor for the 2025 financial year as well as the auditor for any review of the condensed financial statements and interim management report as at 30th June 2025, and any other financial information prepared with reporting dates prior to 31st December 2025 under Item 5.1.

Under Item 5.2, the election of the auditor for the review of any other financial information prepared during the year, with reporting dates after 31st December 2025 insofar as this is prepared before the Annual General Meeting in 2026.

And under Agenda Item 5.3, the election of the auditor for the sustainability reporting for the 2024 financial year. Under agenda Items 5.1 and 5.3, the Supervisory Board proposes, based on the recommendation of the Audit and Risk Committee, that KPMG Aktiengesellschaft Wirtschaftsprüfungsgesellschaft be elected as auditor and also as auditor of the sustainability reporting. Under agenda Item 5.2, the Supervisory Board proposes, based on the recommendation of the Audit and Risk Committee that EY GmbH & Co. KG Wirtschaftsprüfungsgesellschaft be elected as auditor.

Ladies and gentlemen, agenda Item 6 contains the annually scheduled resolution on the approval of the compensation report for the 2024 financial year. Agenda Item 7 deals with an election to the Supervisory Board. Mr. Kazuhide Toda has decided to resign from the Supervisory Board at the end of today's Annual General Meeting. Therefore, a new shareholder representative is to be elected today. Based on the recommendations of the shareholder representatives in its Nomination Committee, the Supervisory Board proposes the election of Mr. Tomohiro Yao to the Supervisory Board.

Under Agenda Item 8, the Supervisory Board proposes that the revised compensation system for the managing directors of the general partner be approved. Under Agenda Item 9, the General Partner and the Supervisory Board propose to approve an amendment to Article 14 of the Articles of Association, which regulates the compensation of the members of the Supervisory Board as well as the underlying compensation system.

In agenda Item 10, the General Partner and the Supervisory Board proposed an amendment to Section 19 of the Articles of Association, which governs the compensation of the members of the joint committee. Agenda Item 11 concerns an amendment to the Articles of Association to further allow for virtual annual general meetings. The General Partner and the Supervisory Board proposed that the General Partner be authorized with the approval of the Supervisory Board, to provide that the Annual General Meeting of the company can be held without the physical presence of shareholders or their proxies at the venue of the Annual General Meeting, which is in virtual format.

This authorization shall again be valid for 2 years from the entry of the amendment to the Articles of Association and the company's commercial register. And shall apply regardless of the General Partners' plans to hold the Annual General Meeting in 2026 in an attendance format.

Finally, I would like to point out that we have published, pursuant to statutory requirements under Sections 126 and 127 of the German Stock Corporation Act that we have published three counter motions on our website. These are my explanations on the agenda.

Shareholders, in addition to my introductory remarks, we would now like to give Mr. Tomohiro Yao, the new candidate for election to the Supervisory Board, the opportunity to briefly introduce himself.

Mr. Yao is here in the room and will now speak to you. He will introduce himself to you in English. So in the German language channel, you will essentially hear the interpreter.

Mr. Yao, the floor is yours.

Dear shareholders, it is an honor for me to introduce myself to you personally at DWS Annual General Meeting today. My name is Tomohiro Yao, and the Supervisory Board of DWS has nominated me to be elected as the shareholders representative to the Supervisory Board.

As I would like to ask you to support my nomination, please allow me to give you some key information about my personal and academic background. I was born and raised in Nara, Japan. I am a Japanese student, and I currently live in the United States in New York City. Before embarking on my professional career, I studied at the Faculty of Law at Kyoto University in Japan. Then later, during my professional career, I completed MBA at the Wharton School of University of Pennsylvania in the United States.

In terms of business experience and leadership, I have been working at Nippon Life Insurance company for 30 years and have held several senior leadership positions spanning across our global businesses. Allow me to elaborate further. Since joining Nippon Life Insurance Company in 1995, most of my business experience and focus has been in the area of international mergers and acquisitions, international planning and operations and the global insurance business of Nippon Life Insurance Company.

As part of the management team, I have held the position of Regional CEO for Asia Pacific, in charge of Nippon Life's overseas businesses and responsible for expanding both life insurance and asset management businesses in the Asia Pacific region.

Currently, I am Executive Officer and have had this position since 2023. And I have been Head of Americas and Europe of Nippon Life Insurance Company since March 2025. I also have extensive experience as a director in similar supervisory bodies comparable to the Supervisory Board of DWS Group. And I currently hold mandates in supervisory bodies in the U.K. and the U.S.

Dear shareholders, I sincerely believe my experience, qualifications and skills would enable me to make a valuable contribution to the effective functioning of DWS Supervisory Board. Therefore, I kindly ask for your support by electing me to the Supervisory Board. I look forward to serving you with respect, commitment and unwavering dedication.

Thank you very much for your attention.

Thank you very much, Mr. Yao, for the words about yourself. Ladies and gentlemen, I hope this has given you a direct and immediate impression of Mr. Yao.

We now come to the opportunities for shareholders to interact and participate in today's virtual Annual General Meeting.

Ladies and gentlemen, when choosing the format for today's AGM, we were particularly keen to engage with you. Unlike in previous years, this year, we have dispensed with the requirement to submit questions in advance. We believe that with the format of today's Annual General Meeting, we can further intensify and strengthen the dialogue between shareholders and management.

Shareholders, therefore, at today's Annual General Meeting have full rights to speak, ask questions and propose motions. This is possible via live speeches and contributions. As the Chairman of the meeting, I have determined in accordance with Section 131 (1f) of the German Stock Corporation Act, that questions at today's Annual General Meeting can only be asked via video communication, that is in the course of speaking and making your contribution. Since 9:30 a.m., you have been able to register a request to speak in our Access protected shareholder portal by clicking on the register to speech button.

After selecting this button, you will be taken to the input screen where you can enter all the information required for your contribution. This includes your name, your telephone number and your e-mail address. In the [indiscernible] or comments field, we ask you to provide us with further information. Speakers will be contacted in a sequence determined by me and after a functional test will be admitted to the waiting room. And from there, they will be able to further follow the proceedings of the meeting until they themselves give their speech live at the Annual General Meeting.

At this point, I would like to take this opportunity to ask you to register your speech in good time so that we can plan the procedure as well as possible. And in this context, I would also ask you to indicate if you would like to address any particular focal points or submit motions, so that I can take it into account when determining the sequence of speakers.

If after the end of your contribution, you would like to make a further speech, you need to register this new contribution again by clicking on the corresponding button either by talk unmute and register to speech in the shareholder portal.

Based on the experience of the last Annual General Meeting, I do not expect that we will need to set a strict time limit for your contributions. But I ask for your understanding that I reserve the right to do so. Irrespective of all this, I would like to ask all speakers to please limit themselves to a speaking time of no more than 10 minutes, so that also the other speakers can have their say in a reasonable amount of time.

In order to ensure a level playing field, a clock will be visible to only the speaker and for myself during the speech. After 7 minutes have elapsed, the green display will change its color to yellow. Thus, underlining our request to give the following speakers also time for their contribution. After 10 minutes have elapsed, the color will change to red. You are, of course, at liberty to register again for the further contribution.

Ladies and gentlemen, the first speakers from the first group have now arrived in the waiting room to address you. Currently, we have waiting Mr. Andreas Schmidt, Mr. Wolfgang Schäfer. After that, Mr. Philippe Diaz, followed by Ms. Julia Dubslaff. After her, there will be Ms. Federico Potts. And so far, last in group 1 is Mr. Markus Dufner.

Before we move on to these speeches and contributions, please allow me to briefly remind you that if you have registered properly for the Annual General Meeting and provide a proof of your shareholding, you can exercise your voting rights via the shareholder portal. If you have opted or are going to opt for postal voting or have granted or are going to grant power of attorney and instructions to the company's voting proxy, you can also cast your vote by the shareholder portal during the Annual General Meeting up to the time specified by me for the respective vote.

Up until this time, poster votes or instructions that have already been cast can also be changed via the shareholder portal. To use the portal, please use the Access data on the registration confirmation that was sent to you. I will specify the time frame once again -- once I have a better overview of the number and total duration of all contributions. But I would like to ask you already now to start making any entries in the shareholder portal in good time. And this is also in order to be able to deal with potential disruptions on the Internet.

We will now begin with the speeches. Ladies and gentlemen, the first speakers are waiting to make their contributions. And as I said already, I would like to ask you to limit yourselves if possible, to a time of no more than 10 minutes. If you've already registered a contribution but decide to not go for it after all, we would like to ask you to indicate this to us.

The first speaker is Mr. Andreas Schmidt representing the German SDK Association. And he will be followed by Mr. Wolfgang Schäfer of the German DSW Association, followed by Philippe Diaz. Please be ready gentlemen. And now Mr. Andreas Schmidt has the floor.

Ladies and gentlemen, of the management, dear shareholders and guests. My name is Klaus Schmidt, Andreas Schmidt and I represent SDK, the German Private and Investor Association. I'd like to start with a couple of formal and also critical points. The first one being the format of today's AGM.

You as the company that depends on the capital market and the security structure in your very essence of the business, it would indeed be appropriate to provide for a hybrid format to also follow, allow for the possibility to be on site and to join virtually. My second point refers to STADA. As far as we're aware, DWS so far did not file any payment claims in the case of STADA, any additional payment claims. There was the acquisition offer.

And then the ruling of the German Federal Court in 2023. If this payment claims are not asserted, there will be no additional payments made. So for the funds affected by it and their investors, but potentially following that, also, there may actually be liability claims to DWS as a whole that could be asserted. So my question on that, what was the amount in this context or the inventory, say of STADA shares in the respective funds? What are the claims asserted so far? And if not all of them have yet been asserted, do you plan to do so? And if not, why didn't you -- don't you plan to do so? And why haven't you done so yet?

Our second point goes to EY, suggested by you as your preferred auditor. Regardless of our concerns regarding the trustworthiness of EY, which we believe have neither initiated the necessary measures to work through the Wirecard disaster nor have they ever adopted adequate measures to prevent similar problems such as with Wirecard in the future.

And possibly, they've even adopted measures in order to steal themselves out of any financial responsibility. But what's even more important, DWS ourselves -- DWS themselves, if I'm informed correctly, have filed action against EY? What's the amount in question here? And how can you prevent that EY learns of internal matters of your process and procedural strategy and make use of that, if they seriously audit your company. Either they are not going for a serious and comprehensive audit or you run the risk of putting at risk your own court suit since EY will gain insight into procedurally relevant documents in the course of their audit.

Please comment on this, specifically as to why in this constellation, you plan to make EY your auditor? Who proposed EY as an auditor? And have these points not been considered? And obviously, given this we cannot at all agree to the election of that auditor.

Now some operative questions. And over the last few years, a lot of positive things have happened at DWS. And I would really like to praise management in all of the employees for this. Not just did you calm things down, but also the operational business was strengthened and positioned better. So thank you very much indeed to the entire team.

And dear shareholders, you might think that my critical questions don't fit in with this kind of price, but the objective is that you, dear investors, dear shareholders are provided with some support and help deciding whether DWS remains a good investment. So still some critical questions. But on the whole, I have to say, it's a very positive picture indeed. Thank you for that.

Now currently, what roughly is the share of Passive products in new business and how stable are the Passive products? The net outflow for instance, with price or share price declines in the stock market, are the fluctuations there bigger or smaller than with actively managed products? And also currently, what's the average management fee with a Passive product? What kind of fee do you expect in, say, 5 years' time for Passive products? And possibly, you could also give us a cost-to-income ratio for Passive products on the one hand and actively managed products on the other.

And now to go into a bit more detail, and I'll explain in a minute why I'm doing that. What would be the cost income ratio, for instance, for 2030, if the current share of Passive products in new business was to continue and the rest remained unchanged versus your planning? So what would this theoretical model calculation look like if the Passive share of new business was to grow by 5 percentage points or 10 percentage points, respectively? And with the unadjusted cost income ratio of below 60% as your target ratio, would that be achievable?

And by the way, another word of praise that you are now referring to the unadjusted cost-to-income ratio. That's very good, because adjustments should be kept at a minimum at all times. My questions regarding this Passive target is what would it mean for DWS if almost all of the new inflows would go into these Passive products at the moment with you, but also with other companies, fund companies we are looking at 70% to 80% that go into Passive products? What would the structure look like and which measures could you initiate if such a scenario was to materialize?

And if such trends become discernible because they are out there at the moment, does it make sense to really focus on CIR, the cost-to income ratio? I would presume that Passive products make a good contribution to the net profit for the year, but are a detrimental effect for the cost-to-income ratio. So for us, as capital investors, we don't care in the end how you improve your overall result for as long as it goes up. And I'd rather prefer additional Passive business, enhancing the overall profit versus no business or a cost-to-income ratio of above 60% at lower EPS. So what was it that in your group planning and management enjoys priority cost-to-income ratio or an additional low-margin Passive revenue.

I believe a lot in cost discipline, and I fully agree with Mr. Hoops' speech on this. And obviously, the cost-to-income ratio is helpful for that. But doesn't one run the risk here that structures are geared towards active, which in the future, however, will only account to for 10% to 20% of new business?

Second, growth hope is the private debt business in the area of Alternatives, as you also mentioned in your speech. And that's in cooperation with Deutsche Bank. I do see that this business field is rather in fashion at the moment, but I'm a bit more critical of it, because it reminds me of the CDO bubble that we had at the outset of the -- that led to the financial crisis of 2009. And the same happens with private debt. We can see some bundling going on. And once it goes on, we'll also be bundling unworthy securities and sell them.

So what's your approach here? What's the volume you currently have under management? What volume are you aiming at? Or are you expecting? Is there any point of risk that you will be held liable? How do you manage the risk on behalf of your customers, but also for us as shareholders? And how do you control and check that you don't become the dumping ground for bad debt at Deutsche Bank?

You've undergone an excellent development recently. And I can absolutely support that and congratulate you on it, but it was mostly driven by Germany in terms of growth. So it is really a blessing for you that you have such a strong position in the EU economy and some competitors certainly envy you for it. But international business does not balance this out so far. And it's not the Gateway to Europe, as you just said and certainly not a gateway when it comes to the U.S. or Asia.

So planning for old age is something that's being subsidized in Germany, where you mentioned that briefly. And is your focus then still on internationalization? Or wouldn't it rather make sense to say, let's focus on the German business. And in parallel to that, that's also what you plan to do, focus on digital business. Because that, if you want, is borderless anyhow.

And is there a risk, as Mr. Hoops also mentioned that providing for old age and old age pension planning in Germany is mostly run by the government institutions and U.S. the fund industry get very little of that. Maybe you could also comment on that a bit.

That brings me to the end of my questions. Thank you very much for your excellent work, for the changes we've seen. And maybe my questions could also provide some input, some impulse for the future. I would like to thank you for your attention. And already at this point, I wish all of you a nice weekend. Thank you.

Thank you, Mr. Schmidt. Thank you for your comprehensive list of questions. Next, Wolfgang Schäfer will be given the floor. And I'd like to ask Philippe Diaz to get ready. Good morning. Mr. Schäfer, the floor is all yours.

Yes. Thank you very much. Mr. Chairman, Mr. Hoops, ladies and gentlemen, my name is Wolfgang Schäfer. I'm a lawyer in Frankfurt am Main, and I'm speaking to you on behalf of DWS today.

We too would like to, first of all, use this opportunity to congratulate you on the excellent performance in the complete financial year despite the difficult situation around the board. We presume that you have set the course for another successful year, and this is at least what I took from your comments earlier today. We would also like to use this opportunity to thank all employees of our company for their commitment and hard work. Without them, this success, this performance would have been impossible. Please pass on our vote of thanks to them.

Regardless of that, I have a couple of comments and above all questions regarding DWS' performance. As my previous speaker was already saying, we can't approve Agenda Item 11 because we cannot see that the authorization to hold a virtual AGM is only used in exceptional circumstances when holding an in-person AGM would be required due to pandemic or something along these lines were due to which the full presence of Board members plus the audience got to be impossible.

Now questions. Where do you see additional growth perspective? And where do you believe we've already come to the end of the story? Where are we affected by increased protectionism of our international activities? What are the parallel structures that you are building in the Far East? We would also like to hear more about AI, digitalization is very popular these days. Do you have a long-term AI digitalization strategy? Please tell us about the three biggest opportunities and risks of AI and digitalization for our company? How would you assess our company in terms of products, processes and mindsets with regard to digitalization in the AI? What are the specific and/or long-term prospects that you're expecting from the realignment of the U.S. administration's policy? You've already experienced quite a lot in this respect.

Our strategy is it -- Gateway to Europe, is it known to the White House? I don't believe that. As you're intending to grow in China and India, as you said earlier today and has also been published at the press, I'm also asking you to tell us more about the Chinese policy and our growth ambitions in China and our business, which, of course, is also impacted by the U.S. administration's policy. Please comment.

Mr. Hoops, in your speech, you said that the investigation of the public prosecute in Frankfurt the regarding Greenwashing affair has been completed. We welcome that very much. With EUR 19 million of fines paid in the U.S. and EUR 25 million paid in Germany, this was not exactly cost effective. Unfortunately, however, in May, the press once again reported that there were some differences in terms of perception or interpretation within DWS between the management and one of your employees regarding sustainability. Both Greenwashing 2.0 affair emerge in this regard. Are you aware that the supervisory authorities in the U.S. and Germany have already launched or will soon launch a further investigation in this respect?

According to the press, you are repositioning your DWS Invest ESG Women-for-Women fund in a new manner. It's now called DSW Invest ESG Social Focus. Please tell us more about the reasons for this repositioning. Is this due to the change in your sustainability strategy? Or has the strategy not worked for this fund? And is that why you now want to position yourselves more broadly?

I've also got a couple of questions regarding the Supervisory Board and compliance. In accordance with Principal 19 of the German Corporate Governance Code and Recommendation D11, members of the Supervisory Board have to undertake further training on their own initiative and must be supported in this by the company.

And according to the report of the Supervisory Board, this is actually what's been done. Please tell us the average number of hours of training and further education undertaken by the members of the Supervisory Board? Have you undertaken further costs for the training and further education of your Supervisory Board? And if so, please quantify these costs.

According to the qualification metrics of the Supervisory Board, almost all of you have got basic knowledge and skills in the areas of governance and corporate culture and ESG and sustainability, including corporate and social responsibility. But the majority of members have extended expertise in these areas. Is this information based on the self-assessment by the respective member of the Supervisory Board? Or has this information been reviewed by your company or an excellent third party and propose to the respective member? Is this actually the same for all the various areas of expertise? Or are there differences depending on the respective area of expertise?

I would also like to know how many compliance relevant reports you received last year. Please also tell us how these were submitted, for example, through a whistleblower office, et cetera? FAZ, The Frankfurt newspaper, were any violations of the law or any policy identified in the fit of these reports? If so, how many? Were there no further reports or indications that would have prompted the compliance office to investigate further? How many investigations have already been carried out in the current financial year by your compliance office, because this is a very important factor for your business.

We need trust so much for me for the time being. Thanks a lot for your attention. I'm looking forward to hearing your answers.

Thank you, Mr. Schäfer. Thank you for your contribution. We'll come back to your questions later. Next, Philippe Diaz will be given the floor. And I'd like to ask Julia Dubslaff to please keep ready or get ready. You will be going next. Both are representatives of [indiscernible] The first audio, Mr. Diaz.

Yes, thank you. I hope you can hear me. Executive Board, Supervisory Board, shareholders, my name is Philippe Diaz, I'm a freelance in Sustainable Finance, above all for the civilian society. I'm speaking on behalf of critical shareholders, as already mentioned, the umbrella organization, and you will have come across me on the 1st of May 2024 in [ plus-minus ] on German television. Regarding a fund, which was advertised as the sustainable ESG funds by DWS on the website, but at best was an engagement fund.

So a prime example of greenwashing. And this is also what the Frankfurt public prosecutor suggested. We all know that DWS went too far in terms of its statements regarding sustainability. This led to whistleblowing, lawsuits, investigations by the federal criminal office. It was the attempt by DWS to paint something green that wasn't green. Unfortunately, and from [indiscernible] this was actively supported by WWF Germany, which lost its moral compass in this regard and not only in this regard.

DWS understandably wants to leave this matter behind and that is good. However, the question is whether DWS does not consider it necessary any longer to pretend it's left this behind. In fact, greenwashing is only a big gap between the marketed reality and actual reality. But DWS has allegedly changed. The gap has become smaller.

But the question is, has the marketed reality simply been adjusted to actual reality? Does DWS simply push away any social responsibility? Mr. Hoops, you have changed the wording of your speech, but I will quote from the speech that had been pre-published and this is quite similar. DWS, you said in the pre-public speech did not make any -- did not instruct any clients on what investment strategy to follow and we will not do in the future either.

We follow sustainability-based approaches. But at the end of the day, it is our clients that decide whether and to what extent ecological, social and governance aspects are taken into account in the investments they make. This means that you are shying away from your own responsibility. This means, you're shying away from environmental protection from possibilities you would normally have.

Do you seriously believe that clients can invest in anything you offer, chocolate from child labor, other products and funds using, for example, and weapons? Let me take one step back and ask a couple of questions.

The greenwashing allegations based by Desiree Fixler, which also led to several fines were actually plausible. At the end of the day, I'm not quite clear yet as to why Ms. Fixler chose to go down that avenue, because she seems to have a very dubious view of the climate crisis. It is not possible for me to find out more about her real motives, but I've got a couple of questions in this respect.

When and please tell me the exact date. Did Ms. Fixler turn to the supervisors to initiate an internal investigation? Please also tell me when the investigation started regarding the fund? Please tell me the exact date? Who was involved in designing this fund? Were there any overlaps between persons involved in the greenwashing, persons in the team that had designed the fund, please tell -- please you don't have to give us the names of the persons, the individuals affected, but please tell us more about the degree of overlap.

I'm trying to understand whether the DWS Blue Economy Fund was just a cooperation with WWF in order to prevent potential future greenwashing allegations. Was that why WWF was taken on board? This cooperation with WWF, but how much were the royalties paid to WWF by DWS in this framework? If you don't want to give us a number, please tell us about the size of the fund for 2021, 2022, 2023 and 2024.

I would also like to ask you to disclose the income from this fund for DWS for each of the 4 years. The fees for the funds according to the website were 7.71% as at 31st of December 2024. It would be interesting to understand how much profits you have gained from these fees. So fees minus costs, and if you can't give us that number, it would be good to know what the average profit per fund is in DWS. So what is the average per fund -- average profit per fund?

I've got another question. Given that the fund we're referring to was continued after cooperation with WWF was terminated. Please tell us more about this from what we know, this separation was unanimous, but what caused this separation from WWF?

And a final question regarding the Blue Economy Fund, our former employees, including Ashok Verma and taking into account for potential recourse payments. This is the end of my list of questions regarding this block of issues. Apart from the financial framework for this fund, I'd also like to hear from you why DWS chose to cooperate with WWF in the first place? Was the sustainability driven in the fund itself, the Blue Economy Fund?

At the end of the day, it was a pilot project. Originally, it had been communicated with WWF Germany that the Blue Economy finance principles were going to be scaled up to include other funds, perhaps the entire portfolio of funds. But from what I know, this failed to materialize. However, this rolling all the requirements over to clients, closing the funds and basically doing the opposite of what you promised. In terms of why you were going to work with WWF because allegedly you want to turn greener as an asset management.

I mean, all of this is a thing of the past now. You're miles away from that. So please, what are the measures that DWS has already taken due to cooperation with WWF that have made DWS any more sustainable, the more the better. And I'm not talking about strategies or declarations of intent, but actual results in terms of how you invest your clients' monies?

Nice statements such as those that you can read in the press or Turkish speaker or these bloom marine-related statements is not what I want to hear. You are -- according to your statement, you will not instruct clients on how to invest their money. Are you planning to uphold that principle? I would also like to know how you are going to make sure internally that this is actually lived out in actual practice?

Now regarding the clients, as already said, the minimum sustainability standards -- but are they to be uphold? Or are they no longer going to apply? Is that why the United Nations Principles for Responsible Investment are going to be given up? What about other ESG principles? Are you going to bend them then? Are you going to follow the principles that have been published regardless of the initiatives that DWS is contributing to?

The fundamental principle seems to be you're going back to CSR, corporate and social responsibility. You're going back to basically trainings that are completely worthless, or procurement focusing on office chairs and computers rather than focusing on your core business. And this also fits in with your donations to WWF Germany, at least you're trying to buy your way towards good conscious.

Over the past few years, how many donations have you made? This is actually going to be continued as far as I know. So projects that would potentially lead to a transformation of your business have all been discontinued, but you continue making donations to WWF.

A few questions by way of conclusion regarding politics. I will conclude on my WWF related questions. The next two questions will deal with the bigger picture. On the 3rd of May, we had the Overload Day -- World Overload Day. So financial institutes and DWS have rightfully referred to political decision-makers accountability. DWS can't be held responsible nor can any other banks be held responsible for doing what policymakers should be doing or what the economy should be doing.

But at the same time, as you can see, for example, in terms of the German supply chain Act that DWS and the likes are lobbying various parties along their own interest. So I've got a couple of questions regarding political processes, and this then takes me to the end of my questions.

Are you supporting the principles of the Green Deal as a matter of principle? Are you supporting the attempt of the Green Deal to adopt a holistic approach to sustainability rather than exclusively focusing on climate issues? At the end of the day, the protection of the biosphere and the climate are closely interrelated.

Do you support the sustainability reporting obligations, the European risk reporting -- sustainability reporting standards that have already been adopted, but are not yet carried out in actual practice.

In answering this question, please also take into account that there's about 4,000 data points if you want to respond to these requirements whereby the ESG-related data point only account for about 1,000 because here, we have human rights, microplastics, biodiversity and other issues that are also reflected in these data points. I'm sure you will be able to confirm that the costs are quite low.

Mr. Diaz, if you would also leave some time for your colleagues to ask questions. You've now spoken about 13 minutes. And as you announced perhaps it would be good if you could come to the end of your presentation and leave some time for your colleagues. Thank you.

Yes. One more minute, please. The bureaucracy cost index drops in 2012 rather than increase and listed companies and financial institutes normally do not even show and disclose the cost of this reporting separately. I would also like to hear more about your view regarding the value chain cap for the standard that's already been presented. Do you consider the standards to be relevant or does it mean that data, including ESG data cannot be disclosed?

My last question. What is your view regarding the duty of diligence under the Supply Chain Act? As already said, this does not only relate to office chairs, even though, of course, the German CBI that is the PSI focuses on that. Would you say it's got an impact on the real economy in Germany. So much for my questions, I would stop here, maybe just a quick comment regarding bureaucracy. It's quite interesting to say where we stand in terms of bureaucracy and overregulation.

Thank you very much. These were my questions. I will come to the end. Thank you very much for your attention. I'm looking forward to your answers.

Yes. Thank you very much. Thank you, Mr. Diaz. Next -- we have the next speaker. We will come back to the many questions you've asked in a moment. The next speaker is Julia Dubslaff. And I would also like to ask Federico Potts and Markus Dufner to keep ready, because they will be going next. Thank you very much. Julia Dubslaff from [indiscernible] floor is all yours.

Thank you very much, Mr. Behrens. Mr. Behrens, Mr. Hoops, members of the Executive Board and the Supervisory Board, dear federal shareholders, once again, we have run the meeting virtually. My name is Julia Dubslaff, I speak here on behalf of critical shareholders. But in my main job, I'm employed at the Environmental Association Urgewald, which probably DWS is fully aware of.

Now with the publication of the carbon policy about 2 years ago, namely in April 2023, DWS actually did take a decisive step to take action against climate change. Another positive example is that in 2023, you taking current ESG data into account, you sold the San Miguel stock holdings because it wanted to massively extend its carbon facilities on the Philippines. Another positive aspect last year, at this point, you announced that you are thinking about an oil and gas policy. At least you're thinking and discussing about it.

Dear, Mr. Hoops, against the backdrop of our activities of Urgewald, your address this morning was actually shocking to me. Climate change is real. I think this is something we agree on. But you do not meet your fiduciary obligations because you only do so by offering some dark green products for the niche. You call them the times have changed in terms of customer expectations, but apart from that, you would rather serve conventional objectives. Now what is actually your understanding of DWS and the fight against climate change? That is my first and also my most important question actually.

Now your address, Mr. Hoops to me, does not really sound like a relevant contribution to climate change. You rather want to use AI and blockchain. However, you are thus certainly lagging behind other German investors, which have already published exclusive criteria for oil and gas. So when will you finally also exclude oil and gas from your portfolio? Did DWS make any progress in regard of such a policy?

Now are you also talking about the expansion of oil and gas production to be used as a criterion for -- in your risk assessment? Does DWS intend to purchase new bonds to be issued by expanding oil and gas companies? Or are you going to exclude such purchases in terms of the coal policy?

After 2 years of your coal policy, what's the track record? Are you aware of any expansions of coal companies? And are you going to exclude them? Are there any plans to lower your threshold of 25%, which is fairly high already before 2030? In 2024, you may remember, there was a discussion about the so-called generational capital. DWS in this context called for a greater -- higher priority of sustainable investment. What actually what does that meant to be?

Climate change is real, Mr. Hoops, as you said in your address. And I think everybody is going to agree with you. However, what's also real are allegations of serious human right violation, environmental damage, for example, in the Parker LNG, Mozambique LNG and the Eco Pipeline in the LNG business, which are massively pushed by Exxon Energy. DWS has been massively invested in TotalEnergies and also ExxonMobil. With TotalEnergies, actually DWS is even the biggest German investor. For this reason, DWS here has a special responsibility in this regard.

Mr. Hoops, which of the allegations on human right violations and environmental damage in connection with the three projects, I mentioned as examples, are you familiar with? How can you make sure that such allegations are also known to your fund managers?

Such findings, how do they impact the risk assessment of DWS for TotalEnergies and ExxonMobil? Does DWS consider these projects as sustainability or reputational risk? Which actions has DWS taken in order to call upon TotalEnergies and ExxonMobil to fully resolve these allegations and eliminate such situations? Will DWS support the request of Union Investment to initiate an independent investigation of the human rights situation? Will DWS also place this request towards TotalEnergies?

Dear, Mr. Hoops, last year, at this point, you said that as part of your net zero ambitions, reducing emissions in the real economy is also one of your focal points. Now selling shares in your view means that you cannot exercise any influence on companies anymore. Now we've had numerous discussions on this. Now which evidence does DWS have that your engagement has resulted in a reduction of emissions? What is the view as part of the Climate Action 100+ Association regarding the energy utilities? Now in 2024, what was the highest escalation level during an engagement process with the company?

Dear, Mr. Hoops, now I, myself, I asked you last year at this very point about your engagement with ExxonMobil. ExxonMobil does not even try on paper to give the impression of taking climate objectives seriously. Now they've got no scope. You've got no Scope 3 emissions and thus, you fully disregard the biggest Scope 0 emissions.

Now in 2024, did you discuss the insufficient Scope 0 targets with that company with Exxon? What is your view of the climate-related efforts of ExxonMobil? When will you finally see a success in your engagement with that company? Do you feel that Exxon is subject to our transitional risk? If so, what is the specific aspect of that risk? And how high is the risk? Does DWS maybe consider excluding ExxonMobil from its investments like a competitor has recently done?

Mr. Hoops, Mr. Behrens, I'm already finished. Now we at Urgewald, we mainly focus coal, oil and gas companies. Well, of course, my questions are indicative of -- most companies which we have on our global coal exit list and a global exit list. I think you are familiar with both of these. Now most of these companies are currently expanding and do not have any credible transformation strategy.

And what I've heard from you today, Mr. Hoops, I cannot see any credible transformation strategy of DWS in terms of carbonization either. You just follow the current anti-ESG trend rather sending out a clear signal to these juggernauts that you're really serious about climate protection. Dear shareholders, please send out a clear signal to Mr. Hoops and DWS by not ratifying the acts of management of the management, because we need real action in climate protection and not just further develop sustainability strategies. Thanks for listening.

Thanks, Ms. Dubslaff for your statement. We will provide the answers later on. So right now, we just have two more speakers in waiting room and no more shareholders in the pipeline. So we will now take first Ms. Federico Potts, also after [indiscernible] and she is going to be followed by Markus Dufner, who also speaks on behalf of the same Shareholder Association. So we have Ms. Potts first and Mr. Dufner is asked to get ready. Ms. Potts, welcome to you.

Thank you very much. Dear shareholders, dear members of the Executive Board and Supervisory Board. My name is Federico Potts. I'm Managing Director of the Association of Finance Association. And I'm speaking today on behalf of [indiscernible] who signed their speaking rights to me. I'm going to tackle two matters today. On the one hand, gender, justice and equality and your investments in arms and defense companies, because gender quality is not just a soft topic which you can discuss when you feel you've got the time. It's a rather hard indicator for entrepreneurial responsibility, long-term success and stability.

Studies have shown that companies with a high gender diversity, especially in leadership positions are more successful, more innovative and better in identifying and managing risks. And therefore, let me praise you because since last year, DWS has been supporting proposals that want companies which they invest in, take action to reduce risks for people and the environment.

Furthermore, such companies must commit themselves to zero tolerance towards harassment at the workplace and gender inequality. So that is something which is highly welcome. What is less pleasing, however, in our view, is the fact that DWS and its investment decisions obviously does not have any clear requirements in terms of equality at companies. Thus, gender sensitive, zero tolerance policy towards discrimination and employment and job would be required. But DWS does not take this into account, nor does it pay attention to equal pay for different genders. And the UN Women's Empowerment Principles of United Nations are not being supported by DWS either. So therefore, my question is, why does DWS not ask the company which invest in to take active action for equal pay and to fight gender-based discrimination?

And why does DWS not support the women's empowerment principles? Does DWS intend to change this in the future? And if so, by when? And if not, why not? And furthermore, how does DWS internally make sure that all genders receive the same pay for the same work? And are there any transparent reports and objectives on that matter?

In the last few years, DWS has made progress in terms of gender diversity in the portfolio companies, whereas in the past, no expectations had been stated. But now at least, at least for Germany and for Europe and North America, 30% women's share in Supervisory Board is expected, and has also taken respective action against individual candidacies, which we welcome very much.

However, this claim and the vision only applies to a certain part of the world, whereas in Asia and other countries also in Japan, such action is not that severe. So applying an international standard does not exist yet, nor the transparency on actual progress made. Therefore, my question here is, why do the expectations for gender diversity in portfolio companies only in different regions of the world? Does DWS plan to change its requirements towards a global standard? And if so -- if not, why not? And how do you make sure that gender diversification is not just the lip service on paper, but it's actually implied in real life and in real work?

And so far, DWS, it seems does not have any clear requirements for portfolio of companies were complying with gender equality and justice to women is also required towards sub-suppliers, because exploitation and violence towards women often occurs in the upstream areas of the supply chains, for example, in the textile or commodities sector. Why has DWS so far, not stated any requirements for companies also along their supply chain to ensure the protection of women's rights across the entire value chain.

Does DWS plan to change this approach, if not, why not? Now defense companies. DWS has stated that Article 8 managed funds, which have ESG or similar phrases in the name and the DWS standard filters apply, and those that apply to DWS basically exclusion filters that are acceptable. Now which funds use the DWS investment standards filter, which continues to exclude defense? And how many of the Article 8 funds are using the DWS basic exclusion filter where there is -- the defense exclusion has been removed? And how much money has been maintained in Alternatives funds, which are allowed to invest in defense?

And how much resources are in funds where such investments are excluded? DWS has also stated that investment in manufacturers of controversial weapons according to international conventions such as cluster bombs, chemical and biological bombs, is excluded in funds with the DWS basically exclusion filters.

Is this a conclusive list? Or are there other controversial weapons which are excluded? Have manufacturers of blinding laser weapons being excluded, and are manufacturers of white phosphorus excluded as well?

After the recent adjustments, funds with the DWS basic exclusion filters cannot only invest in conventional weapons, but also in nuclear weapons and in weapons of depleted uranium. Now why did DWS now decide to invest in these controversial weapons? What has changed for DWS now to assess manufacturers of depleted uranium in a different manner?

Now the decision to add companies into DWS basic exclusion filters. Did you carry out a survey amongst clients before you did so? Does DWS believe that the majority in this DWS funds is satisfied with the change of direction? What was the response of investors and clients to this change of direction? And if so, what was the response? What is the role of the financial performance of defense shares since 2022? And what was the influence on the decision to exclude us from the exclusion filter? And to what extent was the underperformance fear relevant here?

So far, DWS does not have any criteria against exports in regions violating human rights. However, European defense companies not only sell to Western countries, but also to countries in Yemen, Gaza, or [indiscernible]. Therefore, companies supporting violent action that goes against international standards can foster conflicts and violence in such regions. Therefore, my question is, does DWS intend to exclude investments in companies that support wars and violent activities in such regions. Does DWS also intend to exclude investments in companies which are involved in regions and companies which are subject to corruption allegations, which include HENSOLDT, General Dynamics, and others.

DWS also says that it needs to support the armies of democratic countries. Is DWS aware of publicly listed companies which produce arms only for democratic regions and do not supply any arms to regions where war is waged against the population? And my last question, does DWS plan to influence companies not to deliver arms to regions where human rights are violated. And does DWS intend to exclude such companies from their funds activities? And if not, why not?

Thank you very much, Ms. Potts, for that [indiscernible] of questions. Later on, we'll provide the answers. We've got now one more speaker in the waiting room, which is Mr. Markus Dufner, also speaking on behalf of the Dachverband der Kritischen Aktionärinnen und Aktionäre. Mr. Dufner, you've got the floor. And if you, ladies and gentlemen, have further request to speak, then please register on the portal. At the moment, Mr. Dufner is the last speaker. And maybe after that, we can already start providing answers. Mr. Dufner, you've got the floor.

Yes. Thank you, Mr. Behrens. Dr. Hoops, Mr. Behrens, members of the management, shareholders, my name is Markus Dufner. I'm the Managing Director of the Dachverband der Kritischen Aktionärinnen und Aktionäre, and we have 30 member organizations involved in the climate and environmental protection and human rights, and we represent part of civil society in that regard. We also have the Klima-Allianz Deutschland with 155 membership organizations among our ranks.

Ladies and gentlemen, together with [indiscernible] finance, we have released a press release for this AGM, where we address the empty promises of DWS regarding ESG. And now my colleagues and I have listened to the addresses by DWS. And my previous speakers have also justified their criticism.

Now Mr. Hoops, I heard in your address that you believe that the internal construction sites and problems in DWS not only want to be finished quickly, but also quietly. So does that mean that you're not going to say anything about that at all? That ought to be different. That ought to be dealt with differently. This should become part of your DNA, namely that errors that have been made in the past in conjunction with greenwashing are not repeated. So go beyond that. Don't just finish that chapter without any word on it.

Mr. Hoops, now I would like to ask you a question about the economy. So how can the EU increase its competitiveness and bolster itself against shocks. And our possible answer would be, well, with 90% fewer greenhouse gas emissions by 2040. That's not what climate activists are requiring, but 150 European companies and investors in an open letter to the EU, in this sign-on letter on the EU to set a greenhouse gas emissions reduction target of at least 90% by 2040. Now in this letter to the EU Commission and to the delegates of the EU Parliament and to the heads of state of the member states of the EU, these entrepreneurs and investors say that we need a robust climate goal for decarbonization of our economies to make the EU more robust against shocks and to improve competitiveness in the EU.

Now regarding the signatories of the letter, we have SAP, the Otto Group and Allianz, amongst others. Dr. Hoops, why is DWS not one of the signatories of this letter? Now can you envisage that you may indeed become a signatory? And if not, why?

Now asset managers design the world in which we live by investing in the companies that they invest in. Now an investigation by ShareAction showed that most of the biggest players on the market do not invest in a responsible way and continue to pursue a path towards fossil fuels, loss of nature and the expansion of controversial weapons. As middlemen in the financial sector, your irresponsible investments are carried out almost exclusively with the money of other people.

And under the title, Point of No Returns 2025, ShareAction published a ranking of the biggest asset managers in the world. DWS is not right at the bottom, but also not right at the top. It's at rank 18. And this was looking at issues of climate, biodiversity, social governance and stewardship. So also a question of assuming responsibility. With regard to biodiversity, DWS was in the red area; and climate, orange. So bad or not very good. Dr. Hoops, what are you going to do to make sure that DWS will soon have better results in this regard?

That brings me to the counterproposals of the Dachverband on agenda Item 3. DWS failed to take control in a responsible way and adequate way of the greenwashing affair. That is why we will not ratify the acts of the management of the general partner for fiscal year 2024. Despite repeated public criticism, DWS made ESG pledges that did not equate with reality at an early stage, and without external investigation, DWS also have put an end to that. However, it first took the investigations of the public prosecutor's office to put an end to this.

The rating, Morningstar and its apparent rating on DWS is interesting. And as such, a questionable and instable management led to the problems at DWS. The previous CEO, who had initiated the ESG investments, left in 2022. Due to that, his successor, Stefan Hoops, is the fifth CEO in 10 years, which underscores the instability within the management of the company. This nomination also shows the permanent influence of the parent company even after the IPO of 2018.

Hoops has spent most of his career at Deutsche Bank, but does not have a background in asset management. Ultimately, Morningstar reaches the conclusion that DWS needs to be monitored carefully to avoid further issues. My question in this regard would be what has been the result of these discussions with Morningstar? What did you respond to with this not particularly good rating? And what remedial actions will you take, Dr. Hoops, Mr. Behrens?

That brings me now to agenda Item 4 regarding the active management of the members of the Supervisory Board. We also shall not ratify these acts. The Supervisory Board has a central role in the strategic positioning of the company and for the monitoring of the Executive Board, in particular, looking at risks, sustainability and long-term corporate goals. In this function, the Supervisory Board failed to fulfill its requirements adequately, particularly with regard to the insufficient climate strategy of DWS and the fact that there are so many funds still involved in fossil fuels.

Mr. Behrens, because you have only been the Chairman of the Supervisory Board for 1 year, this is perhaps less to do with you and more to do with your predecessor, Karl von Rohr. Now in your address before, you underscored the wonderful transition from Mr. Rohr to you and the transfer. Perhaps you can explain in more detail in which regard you wish to give this seal of approval. In which regard did Mr. Rohr talk about these sustainable investments? What changes will you make, if any? How does it feel for you that your predecessor, Mr. von Rohr, is now a simple member of the Supervisory Board and is now accompanying your work and perhaps is also having a slightly critical eye on you. Do you feel safe in that environment?

And finally, the counterproposal against agenda Item 11. The Dachverband der Kritischen Aktionärinnen does not agree with the resolution on an amendment to Section 21 of the Articles of Association to further facilitate virtual general meetings and the authorization of the Management Board. And after several years of experience of virtual AGMs, we still have the same opinion, the format and the way in which such AGMs are carried out affect elementary rights of shareholders. And therefore, the AGM should be making this decision and not the Management Board or the Supervisory Board. It should be up to the AGM to decide in which format future AGMs are carried out. The AGM should be given the opportunity to decide as to whether a further option would be a hybrid format, which would marry up the advantages of an in-person event with a digital event. My question to you, Mr. Behrens, Mr. Hoops would be, will the DWS provide for an in-person AGM next year or perhaps even a hybrid AGM? And what about the years up to 2030? Thank you very much for your attention.

Thank you, Mr. Dufner. I can see now that we have -- and we will, of course, respond to your questions, Mr. Dufner. I see that Ms. Julia Dubslaff has a further request to speak. Please, you can take the floor, Ms. Dubslaff.

Thank you, Mr. Behrens. You asked me to be as brief as possible, and I wanted to adhere to that. But because there is no one else on the speakers' list, seemingly, I have a few last questions, just 2 or 3 minutes. Thank you. Now one of my previous speakers has already addressed this briefly. A few days ago, it became clear that Munich Re has stepped back from a number of climate initiatives. That is a fatal signal. How will DWS deal with this in their memberships of these initiatives? What position does the DWS represent in the repositioning of the net zero asset manager initiative after BlackRock and others have left it? And what will be the effect of the repositioning of the reduction goals of DWS.

Moreover, I'd just like to briefly allude to the SFDR EU Regulation, the Disclosure Regulation there. In a DWS press release regarding the consultation on the state of affairs of this, I read in a small excel sheet that the SFDR is considered by DWS as a labeling and marketing tool. Now that makes me feel that -- well, DWS only has 70 funds according to Article 6 and considerably more according to Article 8. So labeling and marketing tool. What is the justification for this? How many funds did DWS have at the time and how many were renamed at the time of the other regulation being introduced. How many of these renamed funds are directly managed by DWS? What reasons were there for the renaming of these funds?

Ms. Potts asked similar questions. Will any other investments in coal, oil and gas companies be maintained? How many funds with sustainability, environmental or impact names are still directly managed by DWS, and how many assets are managed there currently? So that's 2.5 minutes. That was it for me. Thank you. And of course, I'm very much looking forward to your responses to my questions.

Excellent. Thank you, Ms. Dubslaff. Then I would begin with the first answers. Perhaps just by way of introduction, thank you very much to all of you for your commitment and your questions, particularly to those known faces, Ms. Dubslaff, Mr. Schmidt, Mr. Schäfer. Thank you also for drawing this balance that you've had, where you do provide praise for the progress that we've made, but also provide constructive criticism on those things you think where we could do better. We do respect that very much indeed.

In the interest of the shareholders, I will try to group things thematically. So I'm not going to go through the people A, B C, but rather will try and deal with things in thematic blocks. I'll start with the business issues. Perhaps just as a piece of information, Mr. Schmidt -- Mr. Schäfer, thank you for the questions, some of which were impulsive, as you said yourselves. So please understand that we can't exhaustively respond to every single question, because some of these things are due to our daily business. And we don't know what the world is going to look like in 2030.

I will start with our most important area, Active business. Mr. Schmidt, you asked about the risk of a too strong orientation towards actives with over 70% share of our overall revenues at DWS, and that is where we have our greatest revenues. And you asked about our orientation and our positioning, particularly looking at bonds, and we have our multi-asset solutions, and we intend to increase this. At the same time, we are going to focus on strategic growth initiatives to make our business model more diversified and fit for the future.

With Alternatives and Passives and Active ETFs, we do see further market potential there. Moreover, we are investing in digital trends. For example, asset management as an integrated service as well as in digital assets. With this allocation of resources, we want to ensure that we can expand our business beyond the Active segment and that we are also positioned in future-proof growth areas. Then there was a whole host of questions about our phenomenal Xtrackers business, Passive products there. And I would like to start there with you, Mr. Schmidt, you asked about the development of our Passives and the stability in the price fluctuations and the earnings contribution and also the effect on the CIR there.

Now regarding the proportion of Passives in new business, the proportion of Passives in new business has increased significantly in recent years. In 2024, the net inflows from Passives, including Xtrackers, we were talking about EUR 41.8 billion and thus over 100% of our overall net inflows. Also in the first quarter of 2025, we have been able to see this positive trend increasing.

Regarding the question of stability, neither for Passive nor actively managed products, do we have a generally applicable correlation between net outflows and decreasing prices on the share markets. Passive products are considered to be stable. But of course, we can also see outflows there with strong fluctuations. DWS with its ETF brand Xtrackers profits from its broadly diversified product mix, which also offers customers the correct product in volatile market phases. Regarding the question of margin development, the average management fee margin was in 2024 at 16 basis points, and that was in comparison to 26% from the previous year, and that increased to EUR 472 million. We're currently assuming an increase of the management fee for Passives in the years to come as well. This increase could be driven by a greater amount of assets under management, whilst we could also see a compensatory effect for further decreasing margins.

Now regarding your questions about the CIR, we can't provide a CIR for individual asset classes because the cost management is carried out on the general level at DWS. In Passives, we expect positive economies of scale. So we look at the marginal CIR there. Please understand the fact that we can't comment on hypothetical situations. Overall, we expect that the proportion of Passives will continue to increase in the future. Also looking at Alternatives, we see long-term growth potential and moreover, want to further reinforce our Active business. With further cost management and further growth, we expect that our CIR will continue to improve in the future.

Mr. Schmidt, this is slightly linked to the question that I just responded to. You were asking about all new investments in the Passives. Please understand, as I've already said, if we can't comment on any hypothetical model calculations. Overall, we expect that the amount of Passives will increase in our assets under management, but also we do think that Alternatives will provide further growth potential as well. And we will, of course, continue to be very disciplined in our cost management. So we think that this will also have a positive effect on our CIR.

You then asked a constructively critical question as to whether it's a good idea to focus on the CIR if the amount of new Passives continues to increase. You also wanted to know what our priority is in management, whether it's the CIR or the lower margin revenue. Now please understand if we can't comment on any hypothetical model calculations. Overall, we expect that the amount of Passives in the assets under management will continue to increase in the future. And as I've already alluded to, we think that there are further positive perspectives for the Active business and Alternatives in the future.

We pursue 2 financial goals, so the earnings per share and the cost-income ratio. The earnings per share has the highest priority. That is the contribution that we can feed back to our shareholders. The CIR is a very important steering tool, in particular, to be able to ensure that if there is a loss in earnings, we can still remain profitable. Every earning that is profitable and that can help with our earnings per share is a focus of management.

You then, Mr. Schmidt, asked a question about private debt, and you commented on that as well. You asked us to elucidate our approach to private debt and the volume that we currently manage, our expectations and our control mechanisms, particularly with regard to our cooperation with Deutsche Bank. Now on a global level, DWS manages over EUR 15 billion in structured and private credit. This includes structured loans and real estate credit. Deutsche Bank and DWS have already been working together in origination of credit to medium-sized cooperations in Europe since 2018, and we intend to further pursue this in the future. And that will be in specific areas where we will have preferred access to asset-based finance, direct lending or other credit origination, which is issued by Deutsche Bank.

Regarding portfolio management of the respective DWS funds is still left free. That's the relevant point. They can decide freely as to whether they want to be involved in that. So we as the fiduciaries are able to decide there. In any case, with every transaction, we will have an established monitoring process. The entire fiduciary responsibility, including management, remains with DWS exclusively.

Then, Mr. Schaffer, you asked generally about growth perspectives, and we would like to just respond to that. Of course, we are very committed to increasing and realizing our growth potential in Passives and Alternatives, and we see great perspectives there. We also want to reinforce our very leading role in established markets, particularly in shares and bonds.

You also asked, to what extent we are affected by the increased protectionism. You also asked about U.S. policies and the effect thereof on our business. We believe that protectionist tendencies offer opportunities as well as pose risks. For example, the amended debt policy in Europe has made Europe more attractive to investors abroad. As I've already said in my address, we see great potential in our leading position as DWS to be positioned as a gateway to Europe. This repositioning of U.S. policy has not changed anything about our commitment and our belief that we have to be global. Thus, we maintain our position that we want to grow in China and India. Nevertheless, of course, we are continuously keeping an eye on global developments and take that into account in all of our strategy decisions.

Moreover, you also asked about our structures in the Far East. And I already alluded to this in my address. We're talking about markets with increasing wealth, and that means that we want to further anchor our presence there. In China, we can build upon our investment in Harvest Fund. We have been involved in that with 30% for many years, and this provides reliable value. And we have already stated our intention to expand in China. India is a very interesting developing market for asset management, and we are pursuing our goals for strategic partnerships there. And of course, in Japan, in addition to our general organic business with Nippon Life, we have continued this for further 5 years in 2023.

Now as a segue here, Mr. Schmidt, you asked about the strategic positioning of our business between internalization and a further even stronger focus on the German market. Now Germany is our domestic market clearly. Our positioning here is our key success factor and it's also the foundation for our sustainable success in the future. We are also, however, represented in international markets. As I've already alluded to previously, we want to grow in the Asia Pacific region to benefit from the market potentials there and to also further pursue our geographical diversification.

We believe that there are opportunities in the digital business, be it in digital coverage or digital assets, and we are looking at these independently of the regional strategy. And of course, we bear in mind all of the regionally deviating and differentiating regulatory requirements there. We, of course, welcome the reform for the pension schemes in Germany and also see that there are relevant areas of action for us as asset managers. So for example, privately organized deposit accounts, as has been set out in the coalition government agreement, which provides increased flexibility and attractiveness for private pension schemes.

Mr. Schäfer, you asked about our long-term AI and digitalization strategy and what we see as the major risks and opportunities. The topics, digitalization and artificial intelligence have a continuous influence on the adjustment and further development of our strategic initiatives. We have a number of potential AI applications that we've identified, and we see the largest potential in the application of AI to process optimization. We see further potential in possible efficiency increases and risk reduction across the entire value chain. We've identified a number of risks, which include algorithmic distortions and discrimination, hallucinations or lack of transparency and traceability with AI-supported decisions. Topics, AI and digitization are under constant development. So we focus on enabling and training our staff accordingly in order to make full use of the potential of those topics in competition.

Then there were a number of questions which were not of a business nature, but specifically addressed the topic of non-sustainability. And Mr. Schmidt, with a view to the takeover offers for STADA at the time in 2017, and the ruling of the German Federal Court in '23, you asked whether DWS filed additional payment claims and you wanted to know what the inventory of STADA shares was in the funds affected and whether any claims were asserted and if you want to do so retroactively. And if not, you're asking for the reasons for why so far or in the future, we did not and do not plan to do so.

Now the Federal Court's ruling from 2023 on the STADA takeover offer in 2017 is something we're aware of, obviously. So generally, we do follow the German market, so we are aware of it. DWS funds accepted the takeover offer for about 740,000 shares in 2017. So the theoretical claim to additional payments amounts to a total of maximum EUR 6 million. We're currently still looking into asserting such claims for the affected DWS funds. And our review includes, amongst others, weighing the risk of process and procedural and litigation costs to the funds with the prospects of success when asserting the claims, because you were asking for the reasons for why or why not to take the corresponding steps. And we think we can assert our claims until the end of '26.

Mr. Schäfer, you asked for the reasons for the repositioning of the DWS Invest ESG Women for Women funds and the renaming into DWS Invest ESG Social Focus. DWS regularly reviews their products in terms of development, net inflows and investment policy. And in this context, the social factor was adjusted as part of the investment guidelines. And in order to reflect that, the name of the fund was changed accordingly, which also allows us to approach a larger group of investors. Investors were informed about that change in March 2025 by written notification.

Mr. Schäfer, you are making reference to press coverage, and we're asking whether after the end of the ESG-related investigations in the U.S. and in Germany, there are other supervisory investigations to do with DWS in the field of sustainability, and whether we need to be afraid of another greenwashing 2.0 affair. Now we ask you to understand that we will neither comment on the opinions voiced by individual employees, nor the special audits covered by the press. However, we have no indication at the moment that your concerns might have any substance.

And also, Mr. Schäfer, you asked for how many compliance relevant reports and notices we had in the 2024 financial year and so far in the '25 financial year, and which ways of filing those reports were used, and whether based on those reports, actual violations of legal requirements or policies were identified. And you also asked for the number of investigations going on in the current financial year.

Now with our whistleblower system, we make sure that there can be an effective and anonymous reporting of potential misgivings and nonbeneficial situations at any time. The reports received are reviewed by a specialized team in a timely manner and our process to ensure that they are reviewed accordingly. In the '24 financial year, this whistleblower system resulted in 31 such reports. So far, no violations of legal requirements were identified. In 2 cases, we identified violations of internal guidelines that were addressed. Over the first 5 months of the current financial year, we've so far registered 14 reports, which also are being addressed in keeping with our internal processes. And we ask you to understand that we cannot comment on any specific measures and reports. And also, we respectfully refer you to the explanations given on Pages 121 and 124 of our annual report 2024.

I am now going to answer the first questions asked by the Dachverband der Kritischen Aktionärinnen und Aktionäre from DWS. Let me start with one contribution. Mr. Diaz asked whether we offer everything to our customers. And I just want to make sure that, obviously, we don't just offer everything and anything. So customers can just tell us, this is what I want to invest in and we automatically offer it. I think the way to see it is that we offer a range of products, a wide range of products, green but also conventional investments. And then our customers decide what of that they want to choose.

Mr. Dufner said that we are investing other people's money, and that is true. So these people have to decide what they want. And if somebody tells us, I want a higher pension share and therefore, more conventional investment; or I'm ready to accept a lower return, but I strictly only want that type of investment, then it's those clients' decision. It's not something we can do for them. So with all due respect, it would be misgiven and mistaken if we were to force our view of things on our customers. So let me repeat, we don't offer everything. But as part of our wide product range, we are obliged to have our customers decide themselves what happens to their money, and that is what we stand for.

Now with that, I'd like to answer some of your questions, Ms. Dubslaff. And I don't think we've been in conflict in recent years. We've been discussing controversially, but productively. You asked for our conclusion regarding the implementation of our coal policy and reactions of coal companies, and whether we plan to reduce the threshold of 25% before 2030. Now the implementation of the coal policy over the past 2 years led to a reduction of our investment into coal companies. And this is due in particular to the adjustment of the investment limits in products managed by DWS. So far, we have had no reactions from expanding coal companies that were affected by that exclusion. A reduction of the 25% sales or revenue threshold is not planned for the time being, but we do regularly review our coal policy, especially when it comes to regulatory developments and market standards.

And Ms. Dubslaff, you went on to ask up until when we would take oil and gas companies out of our portfolios, exclude them, and whether we have made any progress. Now as an asset manager, we are always orienting ourselves along the investment targets and guidelines of our customers. Our customer groups can have different investment targets, which do include sustainability targets, but can also just be aimed at financial performance. In order to do justice to the many sustainability requirements of our customers, our European-based products are designed differently in keeping with Section 8 of the Disclosure Regulation.

Products that have names, including ESG or sustainability-related terms fulfill the requirements of the ESMA guidelines, including a binding exclusion for fossil fuels such as coal, oil and gas. Products which are reported according to Section 8 of the Disclosure Regulation, but do not have those terms in their name also underline certain exclusion criteria. For example, when it comes to oil, sand, or our DWS coal policy. Also, we aim at a constructive dialogue with oil and gas companies as well as with companies who drive the demand for oil and gas. At the moment, we do not plan any additional oil and gas policy which would go beyond the approaches and activities already implemented today.

You were also asking whether the expansion or extension of oil and gas production is a criterion for risk assessment. The extension of oil and gas production can, to the extent it is material to a company's activity, be a factor in our risk assessment of such a company and can be addressed as part of our stewardship activities in a dialogue with our portfolio companies. Also, this matter, if it's material, can be taken into account in the active investment business in the various steps of the respective investment process, such as in the analysis of fundamentals of the issuers and portfolio management.

You also asked whether we are considering to exclude the purchase of newly issued bonds of expanding oil and gas companies. And I can confirm that at the current point in time, we have no such considerations. Also, Ms. Dubslaff, you asked for proof as to whether this has led our engagement and this has led to a reduction in emissions. Generally, it is difficult to trace back the progress of a specific commitment to one single investor, because there are many other factors that can influence such changes. More information on our investments, you will find in our stewardship report 2024 and on our website, where we have investment letters, or engagement letters rather, catalogs of questions, and also speeches held at AGMs.

And next, you, Mr. Diaz, asked for the results of our cooperation with the World Wildlife Fund and what effect that has on us. One aspect of the cooperation with WWF on the topic of biodiversity was to further develop our capacities and expertise in the field of biodiversity and nature-related topics. Based on the findings from that cooperation, we, for instance, have further developed our approaches when it comes to dealing with nature-related risks and opportunities to do with water and deforestation in connection with our stewardship activities.

And you then asked more specifically regarding our cooperation with WWF, what it gave us or how we benefited from it in terms of sustainability and I just formally refer you to the answer I just gave.

So Chairman, those are all of the answers I have in front of me right now. Thank you.

Thank you, Stefan. As the Chairman, I continue. I've got one question asked by you, Mr. Philippe Diaz, also to do with the World Wildlife Funds. Other employees, [indiscernible], do you take them -- are you going to hold them liable? And is there a policy that covers this? Mr. Diaz, you asked for potential claims for damages against further employees or members of the Board of DWS. Generally, we can say that we, of course, fulfill all auditory duties to do with claims for damages, but please bear with us that we cannot comment on that any further.

I have a question asked by Mr. Wolfgang Schäfer. You said, according to the qualification matrix of the Supervisory Board, you all covered the various fields, corporate social responsibility and other fields and have basic knowledge about all of those, but in your majority, no enhanced expertise on those areas. Now the statements made there, is that the result of the self-assessment of the respective members? Or were those bits of information provided and tested by an external third party or by an internal body and suggested to the respective Supervisory Board member. Does that apply to all fields of competence or depending on the area of competence, are there differences?

Mr. Schäfer, you were asking whether the qualification matrix is based on the self-assessment of the Supervisory Board members or was reviewed by the company or an external third party. As described on Page 257 of our 2024 annual report, the statements made on the qualification matrix are based on the self-assessment carried out by the Supervisory Board with the support and validation provided by an external consultant. And this process applies equally to all fields of competence identified in the qualification matrix.

There's another question asked by Wolfgang Schäfer. You asked for training measures for the members of the Supervisory Board. For internal education and training measures for the members of the Supervisory Board of DWS Group GmbH & Co. KGaA, we have a total amount of 7.5 hours per member for the 2024 financial year. In addition, there are different trainings provided by external providers, which are split unevenly across the individual members. In total, the company bore the cost of that amounting to a total of a few thousand euros for the 2024 financial year.

Then I have a question here and a somewhat longer answer, addressing a question by Andreas Schmidt of German SDK Association. Dear Mr. Schmidt, you first asked whether DWS filed action against EY ourselves, what the amount under dispute is, and how we can prevent EY from learning about internal information about our process or trial and litigation strategy. And your third question refers to why we proposed the EY as auditor to the general assembly, who made that proposal, and whether all of these points were considered?

To answer your first question, the damage claims filed against EY Germany are put forward exclusively at the expense of various funds, which are not part of the consolidation group or group of consolidated entities within DWS Group and the amounts in total referred to about EUR 550 million. Your second question, looking after and caring for those various legal proceedings does not lead to any business procedures which are part of the annual or group statements of DWS Group, and therefore are not part of the audit. Regardless of that, we will make sure, by adopting organization measures, that in the future, EY in the course of future audits will not gain any insight into our litigation strategy. Also, we would like to stress that the funds audit is not the object of the mandate or a potential mandate of EY Germany.

And your third question, we carried out a fair and transparent selection process in keeping with legal requirements. It was open to all external auditing companies. The selection criteria and their weighting were neutral and already in advance or had already been defined in advance. They were aiming at assessing the quality, the expertise and the independence of the applicants. The audit and risk [Audio Gap] after the selection process initiated by it. Since KPMG as the previous auditor is no longer available for auditing activities as of 1st January 2026, the Supervisory Board of DWS submitted, to this year's AGM, this proposal of initially appointing EY for the period from 1st January '26 and the AGM 2026 as the auditor potentially required auditor reviews. The appointment of a new legally appointed auditor and group auditor for DWS Group is going to be the topic of the AGM 2026. Thank you.

And with that, I have no further questions to be answered. And back to Stefan Hoops.

Thank you. We now have a number of answers to different questions, and we will try to group them by topic. And I'll try to start with a more general one on a particular topic. And then sometimes your questions were addressing rather specific points on individual companies, for instance. So I'll try to come from the general to the more specific points. So first of all, starting with anything to do with World Wildlife Fund and anything to do with sustainability, then questions to do with gender neutrality, diversity and afterwards, defense.

Now Mr. Diaz, you asked for the profit that DWS do from fees for WWF funds and the profit per fund. We assume that you're referring to the admin fees that we retain for this, and we refer you to the annual report of DWS Concept ESG Blue Economy Fund in the section on Cost and Earnings. For the 2024 financial year on Page 17, you will find expenses, and in that, admin costs. Also, you asked for us to confirm that cooperation with WWF was discontinued and terminated from the WWF side and asked us for the data about it. Our partnership, especially in connection with the Blue Economy Fund was terminated on 21st May '25. The termination was initiated by WWF Germany.

Also, Mr. Diaz, you asked for the amount of donations that we made to WWF. Since 2021, DWS has been supporting World Wildlife Fund with an annual project-related donation in the amount of EUR 200,000. Over 3 years, we were able to support the world of WWF along the Mesoamerican Reef near Belize and maritime protection is part of our societal engagement and commitment. You also asked for license fees that DWS paid as part of the contract on this fund. And you also asked for the size of the fund for the years '21, '22, '23 and '24, and the income DWS generated from these funds. Generally, we do not comment on contractual details with partners. As regards to the assets under management and the amount of admin fees for the years '21, '22, '23 and '24, we would like to respectfully refer you to the annual reports of the respective funds that you will find for the respective last year on our homepage and which you can request for years before that.

I then move on to climate change questions. Starting with you, dear Ms. Dubslaff. You asked about our self-understanding in our role fighting climate change. Climate change requires a general transformation of industry and economy and bears both risks and opportunities. We, therefore, see climate change as a potentially material risk to sustainability with direct and indirect financial impacts on companies which can be materializing in physical risk and also transition risks. At the same time, there are investment opportunities in the fields of infrastructure, energy efficiency and green technologies, which promote growth and innovation.

Therefore, we expect of our portfolio companies that they assess and manage material climate-related risks and opportunities. For that, they should implement appropriate governance structures and also provide transparency regarding transition strategies. Additionally, we offer to our customers investment competence and solutions, allowing them to manage the transformation to a low CO2 economy. Next to that, you asked for ourselves, image. DWS as a responsible company wants to contribute to a sustainable future. And as such, we manage the environmental impact of our own operating activities.

Then you, dear Mr. Diaz, asked whether we generally stand by the objectives of the European Green Deal and whether we support any holistic view, not exclusively looking at that. As a European asset manager, we welcome the target of the European Green Deal. The transition towards a more sustainable economy is important from our point of view, also for long-term stability and investment security. At the same time, we are in favor of a practical and proportionate implementation. The regulatory framework should make change easier for companies, especially medium-sized ones, not make it more difficult. We need clarity, less complexity and a stronger focusing on the effect of measures, not just reporting duties. We, therefore, actively advocate the further development and simplification of existing ESG requirements, so that sustainable investments remain scalable and the capital efficiently gets to where it can have the most impact, which is the real economy.

Also, you asked for our attitude towards the European Sustainability Reporting Standards, CSRD. Now although CSRD is not yet implemented international legislation, we were one of the first asset managers worldwide to include a sustainability declaration based on standard EU Standards for Environmental and Sustainability reporting, ESRS, as part of our combined management report. We follow the current discussion regarding the application of the scope of application of CSRD. We welcome the objectives of the European Commission to simplify the administrative effort generated by CSRD and to make the requirements simpler and easier. Our position paper on the Omnibus proceeding is available on our public dialogue website.

Ms. Dubslaff, with that we move on to the more specific points and questions on sustainability. Ms. Dubslaff, you were asking whether we had knowledge about allegations regarding human rights violations and environmental damage sustained in connection with specific LNG projects, which influence this information has on our risk assessment of TotalEnergies and ExxonMobil, and whether we support an investigation into the human rights situation. We are aware of the alleged human rights violations and environmental damages in connection with the LNG project, Papua LNG, Mozambique LNG and the EACOP pipeline. We, therefore, welcome an investigation which will create larger transparency and help clarify matters. And the fact alone that I might not have pronounced it properly does not mean that nobody in DWS knows about it. You will find the details on how we deal with human rights violations in our sustainability declaration as part of our annual report in the section on Workers in Our Downstream Value Chain, Pages 118 following.

You also asked which measures we adopted in order to require from TotalEnergies and ExxonMobil that these allegations be investigated transparently and any violations be removed and remedied. Generally, we address the topic of human rights as part of our stewardship activities. We expect our portfolio companies to implement processes in order to identify violations of human rights, report them and avoid them. For further information, we refer you respectfully to our Stewardship Report 2024. You also asked how we ensure that such allegations are also known to our fund managers. Our fund managers are provided with relevant ESG data provided by external data providers. They, amongst others, also assess whether a company is involved in violations of internationally recognized standards.

Next you, Mr. Diaz, asked when Ms. Fixler for the first time voiced her concerns internally. And as is publicly known, Ms. Fixler reported her concerns internally in March '21. And you also asked when discussions with the WWF on the DWS concept ESG Blue Economy started. This contract was signed in April '21. Discussions about it, however, already were initiated in the fall of 2019. Also, you asked who was involved in setting up the fund and whether there was any personnel overlap in connection with the greenwashing allegations and DWS Concept ESG Blue Economy. We would like to clarify that at no time, there were any allegations against individual employees. Therefore, the question for personnel overlap is mute.

Next, specific company-related questions. Ms. Dubslaff, you asked us about the ExxonMobil climate protection ambitions and our views, in particular, whether we believe that they are subject to transition risks and whether we can see any success in terms of engagement with ExxonMobil and whether we consider excluding ExxonMobil. As other oil and gas companies, ExxonMobil is subject to transition risks. As a matter of principle, we address material transition risks in the form of dialogue with our portfolio companies. Detailed information about our engagement activities are available in our stewardship report 2024. Please bear with us for not providing you with any far-reaching details regarding our interaction with portfolio companies.

Products with ESG or sustainability-related terms in their designations also comply with all the requirements of the ESMA guidelines, including binding exclusions for fossil fuels such as coal, gas and oil. Therefore, investing in Exxon is not possible. At this point, we are not planning any further exclusions regarding Exxon Mobil.

Ms. Potts, you had asked about the reasons for regional differences in terms of expectations regarding gender diversity for portfolio companies. Regional changes in political and regulatory framework conditions can have an impact on our expectations as they may have a material impact on the companies located there, and therefore, region standards may be required.

Political and legal developments in the U.S. have made it necessary for us to review our proxy policy for DWS investment GMBH for American companies as DEI programs and guidelines and policies can lead to economic and legal risks for you as companies.

At this point in time, gender and ethnicity are not explicitly taken into account in our voting decisions for U.S. companies. You've also asked us how we ensure that diversity targets are actively pursued in all the business divisions. We apply our requirements regarding diversity, in particular, wherever this is possible for us because we are shareholders. This primarily relates to supervisory and administrative councils, more far-reaching information very often is not available.

Ms. [ Potts ], you also asked us about our expectations regarding our portfolio companies with regard to the compliance with gender justice and women's rights in the supply chain.

Our mutual funds based in Europe and actively managed and our Xtrackers ETFs which report according to Articles 8 or 9 of the disclosure regulation excludes companies, including companies that have shown severe violations of international standards, including, for example, the UN Global Compact or the OECD guidelines for multinational companies or the core labor standards of the ILO.

We also reserve the rights to ensure that portfolio companies that do not comply was internationally recognized standards or where there are any indications of not addressing controversies in appropriate manner to vote against the reelection of the CEO. So we reserve the right to vote against the reelection of the CEO or the Chairman.

Mr. [ Diaz ], you asked us about the EU supply chain and whether we are all in favor of continuing the requirement of the EU Support Chain Act?

We share the overall target of the EU Supply Chain Act, the CSDDD to promote responsible entrepreneur action along the value chain.

Accordingly, we have not spoken out against the CSDDD. As such, our position was, however, that the specific roles and business model of financial service providers be taken into account in a more differentiated manner. Asset managers do not invest into their own supply chains, but rather have a fiduciary asset management function.

And for our investments, the SFDR requirements apply. Dual reporting obligations would not enhance transparency nor impact but will above all, create bureaucracy. Therefore, we did not speak out against the target of the CSDDD as such, but rather we spoke out in favor of useful and proportionate implementation in the regulation. Our position paper is available on our website in the public dialogue section.

Next, Ms. [ Potts ], you asked us about our Article 8 funds and how many of them have already been invested.

Our actively managed mutual funds based in Europe applying the DWS ESG investment standard filter or use ESG or sustainability related terms in their name continue to exclude investment in defense shares. These are more than 50 funds with assets fund volume managed of more than EUR 50 billion by the end of May 2025.

Our Europe-based actively managed mutual funds applying the DWS Basic exclusion filter and which do not have any ESG or sustainability related terms in the name have been open for investment and defense shares. The respective sales prospectuses have been adjusted for more than 100 funds with a fund volume of more than EUR 100 billion as of the end of May 2025.

Then you, Ms. [ Potts ], had also asked whether with our Article 8 funds we intend to exclude companies, which, in your words, are involved in corrupt defense deals.

The exclusions for defense companies can be found in the product-specific investment policy. At the moment, we do not plan to apply any further limitations for defense industries which report according to Article 8 of the disclosure policy or regulation, actually.

Ms. [ Potts ], you asked which role the financial performance of defense shares plays in the decision to eliminate the defense exclusion in the DWS basic inclusion filter?

Now when we took the decision to adjust our DWS basic exclusions filter, we took the new and changing social consensus regarding the defense industry, the increasingly specific regulatory requirements in the sustainability context as well as the respective adjustment of the target market concept in Germany into account.

You also asked Ms. [ Potts ], why our Article 8 funds, which apply to DWS basic inclusions can now also invest in nuclear weapons and depleted uranium?

In the context of geopolitical developments, the expectations for the financial industries regarding funding the defense sector have changed. In this context, we now agree with the classification of the EU Commission and recognize the contributions of the defense sector to increase robustness, security and peace.

In accordance with the ESG target market concept in Germany, we have therefore opened the Europe-based actively managed mutual funds, which report according to Article 8 of the disclosure policy and apply the DWS basic exclusion filter. Now we all have opened that one for investment in defense shares. Controversial weapons, such as anti-person mines, cluster ammunition, biological and chemical weapons will continue to remain excluded for those funds that apply to DWS basically inclusion filter.

Then Ms. [ Potts ], now you became more and more specific with this question. You asked about our Article 8 funds which apply the DWS basic exclusive filter. And here, the question was whether in addition to anti-person mines cluster ammunition chemical and biological weapons, there are further controversial weapons that are excluded?

Controversial weapons in the context of international conventions related to anti-person mines, cluster ammunition, biologic and chemical weapons, are excluded for those funds that apply the DWS Basic inclusion filter, and that will remain so. Furthermore, funds, which report according to Article 8 or 9 of the disclosure regulation and which have ESG or sustainability related terms in the name exclude those companies which are involved in further controversial weapons or weapon systems.

This includes nuclear weapons, weapons with depleted uranium, incendiary bombs with white phosphorus, blinding laser weapons and weapons with nondetectable fragmentary ammunition. The 2 lateral weapons were included in the respective sales prospectuses with the most recent adjustment of the ESG filter.

Now you, [ Mr. Dufner ] had referred to one quote from my introductory talk, namely that we wanted to resolve the internal challenges quickly and quietly. Now this means that we want to tackle internal challenges efficiently and effectively in order to be able to fully focus on our business for the benefit of our customers and also our shareholders.

Now please give us 1 minute to gather further answers to your questions.

Thank you very much, Stefan. I've got 2 more questions. These are the last 2, which we currently have at the moment. That was a question by [ Mr. Dufner of [indiscernible] ] Mr. Dufner, you asked whether DWS will hold an in-person or even a hybrid AGM next year and what our plans up to 2030 are?

The general partner and the Supervisory Board have decided to propose to the AGM 2025 and authorization that takes the demands of some of our shareholders and leading voting advisers into account. Now we tend to hold a physical AGM already near 2026. And beyond that, also at regular intervals, which must not be longer than 4 years, unless extraordinary circumstances prevent us from holding an in-person AGM.

And then there's a second question of yours, which I'd like to answer, Mr. Dufner. You asked about the handover from my predecessor Karl von Rohr to me in the capacity of the Chairman of the Supervisory Board. And you also asked about the assessment of my work on the Supervisory Board by Mr. von Rohr.

You also asked about potential changes of the strategic focus of DWS initiated by me as the Chairman of the Supervisory Board.

As I already stated in my address, the Supervisory Board elected me unanimously as their Chairman. My predecessor, Karl von Rohr, has closely supported me in the first months of my office and really has made it very easy for me to familiar myself with the work of the Supervisory Board Chairman.

And this also includes ESG matters. Up to the present day, Karl von Rohr is a member of the Special Committee, which we set up in 2021 which deals with ESG matters, and he is also a highly recognized member of that body.

Regarding the strategic direction of DWS, I'd like to emphasize that this is a matter to be handled by the Executive Board which, of course, we closely monitor as the Supervisory Board. And we do so not only during the 2-day annual strategy offsite meeting but on a continuous basis.

Furthermore, as Chairman of the Supervisory Board, I'm in -- I'm having a continuous and direct exchange with the Chairman of the Executive Board, Dr. Stefan Hoops on these matters.

And also, let me also add a personal note. If you're worried about my personal well-being, I feel very much at ease in this setup. Thank you very much.

Now at the moment I think the Chairman wanted to give me a break. But as a father of 3 kids, I'm very resilient in reading matters. And therefore, I'd like to continue right away.

And there were a couple of follow-up questions on the WWF and also questions on diversity and defense.

Mr. [ Diaz ], you asked about changes in our cooperation with the worldwide fund.

Now the collaboration with the WWF in Blue Economy was, as you all know, terminated on 21st of May 2025. In the past 4 years, WWF Germany was an important partner in our cooperation in order to allow DWS to increase their know-how in the area of ocean economics.

WWF Germany has supported us very much in defining and assessing the engagement approach, the assessment of the capability of transformation of companies and the identification and assessment of the engagement candidates. You asked also whether in the future, we want to leave the responsibility for investment strategies with our customers and clients themselves?

I had already stated on this before. Our ambition remains the same. We want to provide investment expertise and solutions, allowing our customers to master the sustainable transformation of the real economy. We manage the funds of our customer. In order to take investment preferences and regal specifics into account, we offer basically products with different investment criteria. But at the end of the day, our customers decide on their own by selecting a specific product to what extent ESG matters are to be taken into account when they invest their money.

Mr. Dufner, you asked about our membership in the Net Zero initiative (NZAM)? Which position we hold after various competitors have left that initiative and which effect that realignment of the initiative has got on the reduction targets of DWS?

In 2025, in January of that month, NZAM initiated a review of their initiative to make sure that their initiative also meets its targets in a changing global environment. During this review, the initiative has suspended its activities. We welcome the decision of NZAM to review its initiative considering the emerging political and macroeconomic environment.

In this context, it is our aim to also review our own approach in order to take the emerging regulatory market and customer-related developments into account. And of course, we will assess the results of the NZAM review as soon as they have become available.

Mr. Dufner, you asked about our exchange with Morningstar regarding the cooperating of DWS.

Basically, the rating is the result of an independent analysis by Morningstar. In the context of the drafting of this assessment, we provide, of course, the information which Morningstar asked about. On the whole, we have a regular exchange with Morningstar regarding our company and our funds. And of course, it is our aim to respond to the aspects raised by Morningstar in a constructive manner.

Mr. Dufner, you asked in which areas DWS wants to improve after having received a critical assessment by share action on the subject of biodiversity, climate and social affairs?

As I've mentioned before, we continuously evolve our processes in order to create long-term value for our customers. In the context of our stewardship activities, for example, we focus on climate-related risks and opportunities, matters related to nature such as water biodiversity and environmental contamination and the compliance of international standards.

Ms. Dupslaf, you asked how many funds which have changed their name by applying the ESMA policy are directly managed by DWS and what the reasons for this name changes were? And you also asked whether the existing investments of these funds in coal, oil and gas companies will remain?

You also asked how many funds with sustainability environmental or impact-related names are directly managed by DWS?

Now of our actively managed mutual funds, the investment policies we determine our own, more than 50 of them meet the requirements of the ESMA policies and have ESG or sustainability-related terms in their names. With a smaller number of such funds in the lower 2-digit range, we have removed these terms from their names. In individual cases, there were adjustments which were independent of the ESMA policies such as liquidations or repositioning.

On the whole, more than 90% of the assets under management of our actively managed mutual funds, the investment policy we determine our own and which initially had come under the scope of the ESMA policies meet the minimum requirements and continue to have ESG or sustainable-related terms in their names.

Furthermore, more than 50 passive Xtrackers ETFs comply with the minimum requirements of ESMA. With a smaller number of passive Xtrackers, ETFs in the lower 2-digit range, ESG and sustainability-related terms were removed from the names. Here, changes of the index methodology or classification required that renaming.

Minimum exclusions for fossil fuels such as coal, oil and gas are covered by the minimum requirements of the ESMA policies, and this has been taken into account in the funds with ESG or sustainability-related terms in their names. All in all, more than 100 funds in the areas of active, passive and alternatives have ESG or sustainability-related terms in their names. By the end of May 2025, they managed to fund volume of about EUR 80 billion.

Mr. Dufner, you asked why DWS had not signed the open letter of 150 companies and investors to the EU institutions to support ambitious climate goals and whether we still consider signing that letter retroactively. Now each statement or voluntary commitment, which we signed must be cautiously analyzed regarding its specific impacts. And that's why we cannot simply sign every statement of voluntary commitment even if we fundamentally agree with its contents. However, we support and welcome any initiatives that aim for sustainable transformation of the economy.

Ms. Dupslaf, you asked why according to our website, we only have 70 funds reporting according to Article 6 of the disclosure policies, while 186 funds do so according to Article 8, although we consider the disclosure regulation as a labeling and marketing tools?

Here, you refer to contribution of DWS to the consultation of SFDR. Now let me clarify one thing at this point. Disclosure in our view, is not a mere labeling and marketing tool. Quite in contrast to that, as part of the consultations, we clearly express that some market participants view it this way. In my address, I had stated that we are guided by the investment aims and decisions of our clients, which, of course, have their own individual interests and key priorities. That's why we offer a wide range of investment policies in order to be able to create long-term value for the benefit of our clients. This includes strategies that take sustainability aspects into account as well as those serving conventional targets and which report according to Article 6 of the disclosure policy.

Ms. [ Potts ], you asked about our expectations of companies regarding promoting equal pay and combating gender-specific discrimination. You also asked as to why we hadn't employed the women's empowerment principles of the UN and how DWS ensures that people have paid the same for the same work?

Now as part of our stewardship activities, we address equal pay and gender-specific discrimination in dialogue with our portfolio companies if we're talking about a material subject for the respective company. As has already been mentioned in one of the previous answers, each declaration or self-commitment that we sign has to first be assessed with due diligence regarding its effects. That is a complex process.

Thus, we cannot simply sign every declaration or self-commitment even if we believe that its content is correct. The same applies here for the Women's Empowerment Principles.

Moreover, you also asked as to how we can ensure fair remuneration between men and women for the same work? And also, you asked for the transparent reports and goals in this regard.

The remuneration framework of DWS applies for all employees in the same way and is based on the same -- on the principle of the same pay for the same work in order to ensure fair treatment of all employees.

As part of our sustainability reporting, for the first time, we have published an adjusted and non-adjusted gender-specific pay gap. For fiscal 2024, in consideration of objective, gender-neutral criteria such as seniority, business division and region, we calculated an adjusted pay gap of 5.2%. We would like to respectfully refer to our management report 2024, Page 114. At the moment, there are no internal or external goals for the adjusted pay gap.

Ms. [ Potts ], you asked about listed defense companies who only provide for armies of democratic states and not to regimes carrying wars and infringing human rights.

As a parameter for the identification of defense companies, we use revenue limits. These do not explicitly take into account a production for democratic states or supply of weapons to war-faring regimes. The database for these exclusion criteria and the processes subject thereto can be found in the respective documents for the respective asset product -- investment product.

Ms. [ Potts ], you asked as to whether according to our Article 8 funds, the DWS basic exclusions filter, whether customers, investors and other stakeholders have been consulted regarding this?

We are always committed to acting in the best interest of our clients. We want to provide solutions that fulfill the requirements of our customers, investors and sales partners.

Regarding investments in the defense sector, we have participated in the Federal Association for Investment and Asset Management in the discussion for adjusting the ESG target market concept. Also, our decision was based on the change in geopolitical situation and the goal of providing a product portfolio for various customer preferences.

For funds that have ESG or sustainability related terms in the name, we see the role of a defense sector further in a differentiated way, and we do exclude investments in defense.

Ms. [ Potts ], you also asked about shareholder engagement in defense companies and whether weapons are not supplied to war-faring nations or regimes? You also asked if we intend to change our approach here?

As part of our stewardship activities, we fundamentally focus on topics, which we believe are significantly instrumental to the ability for a portfolio company to provide long-term value and protecting human rights is an important factor here.

We, therefore, expect of companies that they implement processes to identify infringements of human rights and to report and prevent them. The same expectation is valid for defense companies. For portfolio companies that infringe internationally recognized standards, we reserve the right to vote against the reelection of members of the Executive Board or Supervisory Board. For further details, please consult the corporate governance and proxy voting policy of DWS Investment GmBH that can be found on our website.

And then a similar question, but a little more specific, I believe. Ms. [ Potts ], you asked regarding our Article 8 funds that we -- whether we, for the future, intend to exclude companies that supply weapons to parties that are carrying out wars against international rights?

Now looking at the sustainability context, we still view this in a nuanced way such that our products have different assets and investment criteria. Accordingly, in our actively managed mutuals that are according to Article 8 or 9 of the disclosure regulation all have ESG or sustainability related terms in the name, we still exclude companies that are involved in controversial weapons or weapon systems or that also generate considerable revenue with defense goods.

And we also at the moment are not providing for a general exclusion regarding defense exports assuming that this is not provided for in the product-specific investment policy.

Then 2 questions from you, Mr. [ Diaz ]. You asked as to whether we planned to leave the United Nations supported principles for responsible investment?

We are currently not intending to withdrawal from the United Nations supported principles for responsible investment.

Moreover, you also asked whether we intend to do away with existing ESG policies?

We understand that you mean our ESG-related self-commitments. As I've already said in other responses, we are looking at the inspection of the NZAM initiative, and we'll then take this into account.

Then, Mr. [ Diaz ], you asked about our attitude to the proposed value chain Voluntary SME standard for short, VSME.

We fundamentally welcome the intentions of small -- to protect small- and medium-sized enterprises from disproportionate reporting requirements. Our position paper on the Omnibus proceedings can be found on our website. Thank you.

Now ladies and gentlemen, dear shareholders, we've reached the end of our session answering the questions and are approaching the vote. Therefore, I would like to point out already at this point that granting and changing instructions to the company's proxy and also voting by postal vote are no longer possible, as soon as I have once again explained the voting procedure.

Therefore, please make sure that you cast your votes and instructions over the next few minutes. With the end of the vote, the access to the change function will also be closed for the postal votes and the postal vote data will be recorded to determine the voting results.

I would like to thank the speakers for their contributions and questions and Stefan Hoops for his comprehensive answers and hereby close the debate.

Okay. I've just seen that there are 2 more requests to speak. There's Mr. [ K W Freitag ] in the waiting room. Are you ready and prepared to speak, Mr. [ Freitag ]? Mr. [ Freitag ] is still in the onboarding process, so we'll take a quick break here of 5 minutes. Thank you.

[Break]

Okay. We can continue with the next questions. Mr. [ Freitag ] has registered to speak but we cannot reach him, unfortunately. He's also not visible to us on the portal. So Mr. [ Freitag ], if you want to make a contribution, please let us know.

Also, I would like to point out that in about 10 minutes time, we're going to close the list of speakers. So let me ask you again to register to speak, if you wish to do so and explicitly Mr. [ Freitag ], please let us know if you want to speak. We're not able to reach you, you had logged off the portal.

So we'll start with you, [ Markus Dufner ] for a second round of questions. Welcome back for your second additional questions.

Thank you, Mr. Behrens for giving me the floor once again. Firstly, let me make a remark regarding your answers. I have to say some of your answers had a purely formal nature without going into any detail regarding the content. Let me just give you 1 example. The open letter signed by 150 companies and investors, that is a bit too little, I find as an answer.

We cannot go into the details of all initiatives and open letters, and we are thoroughly reviewing that. I mean, Allianz is not a no-name company and others of the signatures. So it's not just any initiative. And I would think DWS would have to also review that if you are serious about climate protection and decarbonization.

So let me urge you to please review and check this once again. And also comment on it in a more substantial manner. We are not satisfied with the rather offhand answer provided by Mr. Hoops. I'll leave it at that, although I would have some other points of criticism. Thank you.

Thank you, Mr. Dufner. I think we can react to that directly. Mr. Hoops will answer, Stefan?

Yes, I'm happy to do so. Mr. Dufner, first of all, I'm sorry if it came across as us not taking the time for looking at them all. So your request, your question was for us to recheck it thoroughly, I can give you my personal commitment and promise that we'll look at that matter once again and then make the decision on the DWS side that we find apt.

Right. At the moment, I can see no further requests for the floor or requests to speak. Okay, then once again, I would like to thank the speakers for their contributions and questions and also, Stefan Hoops for the comprehensive answers provided and all of you for this debate. And with this, I, since there are no further questions, close the debate.

And with that, we come to the voting procedure. First of all, I'd like to briefly take you through the voting process. At today's Annual General Meeting, only the voting proxy appointed by the company cast vote as part of the voting procedure and on the basis of the powers of attorney and instructions issued to him.

The instructions stored in the system are released to the voting proxy during the vote. The authorizations and instructions issued or change -- changes to instructions made before the corresponding function of the shareholder portal is closed are, of course, taking into account and transferred to the electronic counting system.

The function forecasting votes or making changes will now be available to you for a short time until I have once again summarized the various items on the agenda. Of course, the postal votes will also be fed into the electronic counting system and will be included in the voting results, together with the votes cast today by the voting proxy appointed by the company.

Voting is carried out using the addition procedure. That means that the yes votes and the no votes are counted. In view of the fact that the company's voting proxy representative has been appointed, I will vote on all resolution items in 1 single ballot as follows: For agenda items 1 to 11, the proposed resolutions as published in the Federal Gazette on 30th April 2025 as part of the invitation to today's Annual General Meeting are authoritative in each case. The resolution on agenda item 1 comprises the adoption of the annual financial statements. General partner and the Supervisory Board propose that the annual financial statements of DWS Group GMBH and Co. KGaA, for the 2024 financial year be adopted.

Under agenda Item 2, the General Partner and the Supervisory Board proposed that the distributable profit of EUR 942,891,126.30 to distribute a dividend of EUR 2.20 per no-par value share on the EUR 200 million no-par value shares entitled to dividends for the 2024 financial year and to use the remaining amount of EUR 502,891,126.30 as profit to be carried forward to new account.

Item 3 on the agenda is the vote on the formal approval of the actions of the General Partner for the 2024 financial year. The General Partner and the Supervisory Board propose that discharge be granted. In this vote, the General Partner, the Managing Directors and the shareholder of the General Partner may not exercise voting rights from their own shares or those of third parties nor may third parties exercise voting rights from shares belonging to the general partner, the Managing Directors or the General Partners shareholder.

The persons concerned have ensured that the voting prohibitions are complied with. A countermotion to the management's proposal has been submitted by [indiscernible] which proposes that the actions of the general partner for the 2024 financial year be denied discharge. Anyone wishing to vote in favor of this motion should vote no.

Agenda Item 4 is the vote on the formal approval of the actions of the members of the Supervisory Board for the 2024 financial year. The General Partner at the Supervisory Board proposes that discharge be granted. In this vote, Members of the Supervisory Board may not exercise their voting rights from their own shares or those of third parties nor may third parties exercise voting rights from shares belonging to Supervisory Board members.

Moreover, the General Partner, the Managing Directors and the shareholder of the General Partner may not exercise voting rights in this vote from their own shares or those of third parties nor may third parties exercise voting rights from shares belonging to the General Partner, the Managing Directors or the shareholder of the General Partner.

The individuals concerned have ensured that these aforementioned voting prohibitions are complied with. A countermotion to the management's proposal has been submitted by the [indiscernible] which proposes that the actions of the Supervisory Board for the 2024 financial year be denied discharge. Anyone wishing to vote in favor of this motion must vote, no.

Under agenda Item 5, the Supervisory Board, based on the recommendation of the Audit and Risk Committee, proposes under agenda Item 5.1 that KPMG Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Berlin be elected as auditor and group auditor for the 2025 financial year and for the review of the condensed financial statements and the interim management report as at 30th of June 2025 and if applicable, other interim financial information prepared with reporting dates prior to December 31, 2025.

Under agenda Item 5.2, to elect EY GMBH and Co. KGaA Wirtschaftsprüfungsgesellschaft, Stuttgart as auditor for the review of any other interim financial information with reporting dates after 31st December '25, and so far, as this is to be prepared before the Annual General Meeting in 2026.

And proposed under agenda Item 5.3 to appoint KPMG Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Berlin, as auditor, for the purpose of confirming the sustainability reporting for the 2025 financial year with effect from the entry into force of the implementing the Corporate Sustainability Reporting Directive into German law, the CSRD Implementation Act.

In this respect, the Supervisory Board should only implement the resolution if the appointment of the auditor of the sustainability reporting for the 2025 financial year is requested by the Annual General Meeting in accordance with the CSRD Implementation Act.

When voting on Items 5.1, 5.2 and 5.3, the General Partner, the Managing Directors and the shareholder of the General Partner may not exercise voting rights from their own shares or from third-party shares nor may third parties exercise voting rights from shares belonging to the General Partner, the Managing Directors or the shareholder of the General Partner. The individuals concerned have taken precautions to ensure that the aforementioned voting prohibitions are complied with.

Under agenda Item 6, the general partner and the Supervisory Board propose that in accordance with Section 162 in conjunction with Section 278 that you approve the compensation report prepared in accordance with this. Under agenda Item 7, the Supervisory Board proposes, based on the recommendation of the shareholder representatives and its Nomination Committee that Mr. Tomohiro Yao be elected to the Supervisory Board as a shareholder representative until the end of the Annual General Meeting that resolves on the discharge for the 2026 financial year.

The general partner, the Managing Directors and the shareholder of the general partner may not exercise voting rights from their own shares or from shares held by third parties nor may third parties exercise voting rights from shares belonging to the general partner, the Managing Directors or the shareholder of the general partner. Here again, the persons concerned have taken precautions to ensure that these voting provisions are observed.

Under agenda Item 8, the Supervisory Board proposes that you approve the compensation system for the Managing Directors of the general partner.

Under agenda Item 9, the general partner and the Supervisory Board propose that you approve the compensation for the members of the Supervisory Board, including the underlying compensation system and amend Article 14 of the Articles of Association accordingly. A brief introduction and for the sake of good order, at this point of time, we close the list of speakers. Thank you for understanding.

Under agenda Item 10, the general partner and the Supervisory Board propose that a resolution be passed to amend Section 19 of the Articles of Association with regard to the compensation of the members of the Joint Committee.

Under agenda Item 11, the general partner and the Supervisory Board propose an amendment to Section 21 of the Articles of Association. This is intended to further authorize the general partner to provide, if necessary, for a virtual annual meeting to be held without the physical presence of shareholders or their proxies at the venue of the Annual General Meeting.

Any decision to hold a virtual Annual General Meeting should only be made by the general partner with the approval of the Supervisory Board. The authorization shall apply to the holding of virtual Annual General Meetings for a period of 2 years after entry of these provisions of the Articles of Association in the company's commercial register.

A countermotion to the management's proposal has been submitted by the German Association [indiscernible] , which requests that the management's proposed resolution to reauthorize the general partner to decide on the holding of a virtual Annual General Meeting be rejected. Anyone wishing to vote in favor of this motion should vote no.

So much for the agenda. As already announced, at this point in time, you can no longer issue instructions to the company's proxy. I would now like to ask the company's voting representative to cast the vote. And again, let me point out once more that the possibility to change the voting behavior for postal votes ends with the closing of the vote. I'm now waiting for a signal from the voting proxy to continue.

[Voting]

Thank you. We have received the signal from the proxy. I can see that the company's proxy has had an opportunity to carry out the voting on all agenda items in line with the instructions given to him and I hereby close the voting process. It will take a couple of minutes to determine the results of the vote. We will therefore briefly interrupt for about 15 minutes. And in 15 minutes' time, we will start by declaring the results after votes. Thank you. We'll see you in a moment.

[Break]

Ladies and gentlemen, in the meantime, I have received the results of the votes. Let me now turn to the announcement of the resolutions adopted. After announcing the results, I will immediately close the AGM. Today, as last year, you will be announced the exact -- you will be shown the exact number of yes and no votes in the video transmission. So you will mostly hear me, but not see me on the screen.

You may wish to use the full screen mode or at least enlarge your screen view to see the results. And we will also provide you with details regarding the results shown on the screen. As we will make the results visible to everybody in announcing the results, I would just state the required majority of votes received for each of the agenda items.

The charts shown on the screen are part of my announcement of the result of the votes, and I expressly embrace them. The results of the vote will also be shown on the company's website shortly. Let me once again announce the current attendance of the capital stock of the company of EUR 200 million, divided into 200 million no-par value shares, a total of EUR 179,339,347 no-par value shares with the same number of votes are represented at today's AGM. This corresponds to 89.67% of the share capital. In addition, absentee postal votes have been cast for a total of 74,352 no-par value shares.

In total, this means that 179,413,699 no-par value shares or 89.71% of the share capital are represented here today in the vote. Let me now turn to the results of the voting process. Shareholders, this takes us to the end of our agenda of today's AGM.

Sorry. I state and announce for each resolution as follows: The voting related to the resolution proposals of the General Partner and the Supervisory Board or the resolution proposal of the Supervisory Board as announced in the Federal Gazette of 30th of April 2025.

Regarding Agenda Item 1, adoption of the annual financial statements for 2024. The AGM adopted the proposal with the required majority of votes. This resolution according to Section 286 (1) of the German Stock Corporation law requires the approval of the General Partner. As I can see, the representatives of the General Partner, Dr. Kuder and Dr. Hoops are granting this approval.

Next Agenda Item 2, appropriation of distributable profits for financial year 2024. The Annual General Meeting has adopted the proposal with the required majority of votes.

Regarding Agenda Item 3, ratification of the acts of management of the General Partner for financial year 2024. The Annual General Meeting has adopted the proposal with the required majority of the votes. This means that the counterproposal has become obsolete.

Regarding Agenda Item 4, ratification of the active management of the members of the Supervisory Board for Financial Year 2024. The Annual General Meeting has adopted the proposal with the required majority of the votes. And this means that the counterproposal has become obsolete or mute.

Regarding Agenda Item 5.1, election of the auditor of the annual financial statements and consolidated financial statements and interim financial statements, the AGM has adopted the proposal with the required majority of the votes. Regarding Agenda Item 5.2, election of the auditor for the limited reviews of interim financial reports, the AGM has adopted the proposal with the required majority of the votes.

Regarding Agenda Item 5.3. Election of the auditor for the sustainability reporting, the Annual General Meeting has adopted the proposal with the required majority of the votes.

Regarding Agenda Item 6. Resolution on approval of the compensation report. The Annual General Meeting has adopted the proposal with the required majority of the votes.

Regarding Agenda Item 7. Election to the Supervisory Board, Tomohiro Yao. The Annual General meeting has elected Tomohiro Yao to the Supervisory Board with the required majority of the votes. Mr. Yao had already announced in the run-up to the election that he was going to accept the election result.

Regarding Agenda Item 8. Resolution on approval of the compensation system for the Managing Directors of the General Partner. The AGM has adopted the proposal with the required majority of the votes.

Regarding Agenda Item 9. Resolution on the compensation of Supervisory Board members, including the compensation system and corresponding amendments to the Articles of Association. The AGM has adopted the proposal with the required majority of the votes and the required capital majority. This resolution requires the approval of the general partner, which was minuted and has just been passed to me in the run-up to this AGM by the Notary Public in accordance with Section 285 (2) and (3) of the German Stock Corporation Act. This is the certificate that contains the approval.

Regarding Agenda Item 10. Amendment to Section 19 of the Articles of Association regarding the remuneration of the joint committee meetings, the AGM has adopted the proposal with the required majority of the votes and the required capital majority. Here too, the approval of the general partner is required and had already been minuted by the notary in the run-up to the AGM in line with Section 285 (2) and (3) of the German Stock Corporation Act, and this is also part of the notary deed that has just been passed to me.

Regarding Agenda Item 11. Amendment to Section 21 of the Articles of Association to further facilitate virtual general meetings. The Annual General Meeting has adopted the proposal with the required majority of the votes and the required capital majority. This means that the counterproposal has become moved.

Here too, the approval of the General Partner is required and has already been minuted by the notary public in the run-up to this AGM in line with Section 285 (2) and (3) of the Stock Corporation Act and has been part of the notary deal which has just been passed to me.

Shareholders, this takes us to the end of the agenda for today's AGM.

Ladies and gentlemen, thank you very much for your interest in DWS and the virtual meeting that we have held here today. I would also like to once again thank Stefan Hoops and all Board members for answering the questions, and I would like to thank all employees involved in preparing and implementing this Annual General Meeting.

I hereby close the meeting. We're looking forward to the Annual General Meeting of DWS to be held in 2026. It will once again take place in June. See you then. I wish you all the best. Enjoy the summer.