Deutsche Bank Aktie

[indiscernible] Joining us for this session. It's great to be joined here on stage by Raja Akram, CFO of Deutsche Bank. Raja joined DB at the start of October last year, having previously worked in senior roles at Morgan Stanley and Citi. Raja, I think this is your first conference, right, as CFO. So thank you for joining us, first and foremost.

Thank you, Chris. Actually, super excited. It is my first one as CFO of DB.

Great. So today's session is being webcast. It's scheduled to last around 35 minutes, including some time for audience Q&A at the end. So welcome to everybody as well joining us online.

I think maybe if we start high level macro-wise, the first quarter clearly was characterized by an elevated level of macro volatility that's persisted into the second quarter thus far. So perhaps we could start by just walking through how you see the operating backdrop for Deutsche Bank at this point in the year.

Yes. Look, I think, obviously, the volatility has continued, but I do believe that the market seems to have settled into this new rhythm, which has been pretty productive. I do think that so far, everybody has handled inflationary pressures pretty well. Clearly, the uncertainty around the Middle East is in the backdrop, and we'll have to see how this evolves into further inflation. But honestly, Chris, I think for a bank like ours with a diversified business mix and the presence in all regions, the environment has been actually quite constructive. I think we've been able to kind of leverage the diversity of our business mix, whether it's inside fixed income or around our asset gathering businesses. So far, I think we've navigated really well as you saw in the first quarter, with RoTE close to 13%. We continued to see the same trends in the second quarter.

I think Europeans clearly are focused on their sovereignty, their autonomy and strengthening their system. In the near term, while German growth has been less than what we would have hoped for, the underlying momentum on defense spending and the activity actually has been pretty productive. So I'm pretty bullish in that sense that the bank has actually now set itself to actually perform through the cycle. And what we've seen is clearly that when one part or one region is not functioning, the other one has been able to pick it up. So all in all, I would say, let's see where this thing goes. Hopefully, more of the conflict is behind us than in front of us. But I do think that the market has settled into this rhythm. Clients are actually still taking decisions and not on the sidelines.

Right. And maybe if we then let's go through the divisions one by one, starting with the Private Bank. So AUM in the first quarter reached effectively EUR 700 billion. You brought in a further EUR 11 billion, which is sort of a 6% run rate on net new assets. What's driving that momentum, both in terms of product breadth or market share gains, client engagement, hiring? And I guess what I'm trying to get a sense for is how sustainable are those positive trends? And how are you expecting that to translate into revenues through the rest of this year? And how do you think about the Private Bank revenue expectation for the second quarter in particular?

Sure. Look, while the AUM was record for us, we prefer to think about client assets, which is actually a combination of assets under management and assets under custody. On the AUM side, we saw a very strong over EUR 10 billion of flows into our DPM or discretionary portfolio management, which is high fee paying, which is what really target. And in addition, we've got another EUR 1 billion or so from deposit campaigns. We brought in new money market flows. So that kind of added up to EUR 11 billion. And then we also have very strong inflow in our custody business, which is around EUR 26 billion. So we expect that the AUM flows will continue on a healthy basis.

I do want to reiterate that the reason we look at total client assets is that the custody business, while it might be a little bit lower fee, it's extremely sticky. It gives us great visibility into clients' assets held away from us. And our hypothesis, which we actually begin to prove out is that eventually, over time, we can migrate to fee-based flows. So I do think that going forward, this trend will continue. As you know, we set up a target for EUR 1 trillion of total client assets. We are a little bit above EUR 800 billion at the end of the first quarter. And so far, what we're seeing is that the investments that we've made, both in the new FAs as well as the platform, are actually paying off better than what I expected.

Look, you're asking where is this sustainable. There's always a little bit of a lag between the time you bring new FAs to -- and so the productivity that you're seeing in the first quarter is actually from a hiring that was done a couple of quarters ago. We've just onboarded almost 100 new advisers in the last 6 months. So I expect that as those guys get settled in, then this what I call a flywheel effect will continue. That gives me a lot of confidence that for Private Bank, we'll continue to show year-over-year revenue growth. And I think as you see, from a longer-term perspective, we have great expectations for this business.

And then pivoting to the asset management business, that also had very strong AUM trends in the second -- in the first quarter, sorry. How confident are you in sustaining the positive net flows through the rest of 2026? And how do you think about how that translates into revenue through the balance of the year?

Yes. So let me just step back from a longer-term perspective, we had laid out in the Investor Day that we expected that we will grow long-term flows by almost EUR 160 billion. We are a little bit over EUR 1 trillion at the end of last quarter. That despite that the market impact actually was not that favorable for us, but we still were able to bring organic flows. Look, it's a very diversified offering that we have for asset management. It's a clear inflow to Europe, and has done really well. So in the second quarter, with productive markets, we are aiming a bit higher AUM, we still believe we're going to have strong showing for our management fee side.

Now on the performance fee, the first quarter really benefited from an outsized perspective for an infrastructure fund flow that was actually targeted for the second half of the year. So what we will see in the second half -- second quarter would be a normalization of our performance fees downwards versus the first quarter. So perhaps still revenue growth, perhaps a little bit lower than what consensus today has us for asset management for the second quarter.

Okay. In the Corporate Bank, I guess, it's a little bit the opposite, right? You talked about revenue growth accelerating through this year. Perhaps you can just talk us through what's driving that sequential improvement in performance in the Corporate Bank? How much is the FX and rate headwinds decreasing and how much is sort of underlying factors? And how should we think about the phasing through the balance of this year?

Yes. So look, I've been pretty consistent that we would expect to see year-over-year top line revenue growth in Corporate Bank in the second half of the year. Thankfully, that's not too far away now. On the underlying perspective, what we've seen is average deposits, fee and commission income both grew by over 5% if you look at it on an ex FX basis. The loan growth was actually in excess of 8%. What we are seeing there is clearly the impact of FX and interest rate headwinds, which are both masking the actual operating growth that we have.

And thankfully, in the second quarter, we will see actually sequential growth even on a reported basis. And it's clear that for the second half of the year, we will begin to see revenue growth even on a year-over-year basis. So I'm pretty optimistic that we will exit the year close to a 5% growth rate, but you should expect to see some sequential revenue growth in the second quarter, perhaps on a year-over-year basis, perhaps starting the third quarter.

And then maybe rounding out sort of in the IB, how do you think about near-term outlook there? How much visibility do you have on the conversion, I guess, of the guided IBCM pipeline, the old O&A, the pipeline we have there build into Q2 and into Q3? And what have been the key factors, I guess, in sustaining the momentum, the strong FICC performance you saw in Q1, how is that expected to play out, I guess, if you put financing on one side and the more intermediation on the other side of things?

Super happy with how April and May started for IBCM in general. We are seeing opportunistically clients coming back in both ECM and DCM. And if I think if the markets stay constructive, we expect that we will see some large LDCM activity as well. On the advisory side, again, the M&A pipeline looks pretty healthy at this point on the advisory side. And we also think on the ECM, we have some large IPO mandates where if things stay on track as they are, we expect them. So I think on the IBCM side, we would see year-over-year revenue growth, which we're expecting.

Look, FICC has been a star for us through the cycle. I did an exercise with my FICC head to say, "Tell me how the business has performed over the last several crisis situations." And what we've seen is in the month, usually, there's an impact, and we have come up stronger in the outer quarters. So I do feel we're pretty bullish. The reason is that because our market side of -- trading side of FICC is very diversified between credit, emerging markets, FX and rates. So we have a very diversified platform across all geographies, and that performed super well in the first quarter despite the fact that we were comparing it against a record 2025, and as you know, the FX was clearly an issue for the European banks. So I -- building on the start, I would expect that we will continue to show growth in FICC.

And financing, we are staying strong. We saw that we had some opportunities in the first quarter to deploy some RWA, which we did. An interesting thing, which I think you will see in the Coalition Greenwich study, Chris, we actually gained share in the first quarter in FICC despite what we saw the U.S. banks do from a deployment perspective. So I think also on the FICC, both on the trading and on the financing side, we expect that we will show year-over-year growth.

Well, let's touch a little bit maybe on that deployment narrative because there is this growing debate around the balance sheet deployment you're seeing in FICC across the street, some of that capital flexibility that's been afforded to U.S. peers following regulatory developments.

And then sort of similar but separate is this other question of just scale and fixed cost absorption and the natural things that come with being bigger businesses, tech investment, all those kind of things. So how do you think about the structural competitiveness of your FICC franchise in that context of the evenness of the playing field and the scale -- the economies of scale between different players?

Yes. So a lot of themes in there, but let me just start from the capital side. Clearly, on the short term, the U.S. banks will see some benefits from the capital relief that you're seeing. But I do think that having spent 20 years there before coming here, it's not clear how that relief is going to be deployed exactly. Like how much of it will go actually towards actual balance sheet growth versus equities trading, which, by the way, as you know, we're not in that business and how much of that relief will actually go towards share buybacks. So it's unclear for me as to what the real long-term use of that capital would be.

But on the same side, I think the Europeans, while they may be a little bit behind, are not sitting idle. I think the conversations around FRTB in the short term, the European Bank competitiveness report that's supposed to come out in July and the legislative proposals that are set for 2027 gives me some hope that while we maybe be a little bit behind, it's not completely going to be -- completely unlevel playing field for a long time. But look, that's on the regulatory front, which we don't control. On our side, I think our goal always has been to build a diversified FICC franchise. As I mentioned, we have all the products between credit, FX, emerging markets and rates. So we have been able to compete.

What also helps us, Chris, is that we actually are probably the only true alternative to the U.S. banks at this point. So we are on the table. When clients want to do risk management, they want some diversification, and we have been able to do that. If you look at our returns on RWA, we have held pretty tight, and we've been able to build a scalable FICC franchise that has performed through the cycle, and that gives me great hope that regardless of the short-term differences. And as I mentioned, in the first quarter, despite vast amount of balance sheet deployment, we took share. So that gives me a lot of hope that the FICC franchise does pretty well. Even our financing business is quite diverse across geographies. And we are investing a little bit more in the U.S. in securitized products and on online credit.

So wrapping that all together, having run through the growth outlook for more or less all the businesses, how do you feel now at this point in the year about the deliverability of the sort of circa EUR 33 billion revenue target for this year?

I feel much better about it today than I was at the beginning of the year when we had a lot of uncertainty with the war and the dynamics, I think, because I mentioned we went through 4 businesses, for the most part, all businesses are showing growth on a year-over-year perspective for the full year. So the EUR 33 billion, which, as you know, EUR 14 billion of that is interest rates and NII, given what we are expecting from a rate perspective in Europe, that actually adds to my conviction a little bit that on the interest rate side, we can potentially even do better.

And as we've shown, we have actually overachieved on bringing net new assets or client assets, at least in the first half of the year. And if the markets are constructive, that gives me a lot more confidence on EUR 33 billion. So as I mentioned, I would expect we will show growth on both Private Bank and IB generally. And we will also show slight growth in Asset Management and Corporate Bank from a full year perspective.

Very clear. So the EUR 33 billion is -- obviously, a number of people focus on the other number, the EUR 21 billion of -- around EUR 21 billion of cost that we took -- focus on a lot. How do you think about that then, I guess, from a sort of -- if you look through the rest of the year, you've got the gradual step-up in investments, but you've also got delivering efficiencies at the same time.

And then I guess on a more longer-term perspective, you've talked quite a lot about seeing an opportunity to perhaps outperform on costs, particularly given some of the advances that you're seeing in AI in your business. Can you talk us through that topic a little bit and perhaps try and help us understand how your thinking has changed, if it's changed, as to what is the sort of blue sky scenario there? And how does that impact what you would consider to be the right cost-income ratio for Deutsche Bank?

So look, I think our thinking around the investments, and we were very clear that we viewed '26 as a predominantly investment year because we were ready to go from defense to offense, and we saw opportunities to deploy and take market share. So that thinking around the EUR 0.9 billion or so of investments that we had scheduled for the full year hasn't really changed. We did a little bit less in the first quarter intentionally because we wanted to make sure we deploy when we are ready. So you could expect that, that will phase out, phase in over -- the remaining balance will phase in over the year, probably not evenly, but up and down.

So the conviction around that stays, the conviction around the full year expense target that we laid out in IDD is completely there. I think one of the things that I would -- just for this quarter, I'll highlight is that as you saw, we spent a little bit less in the first quarter versus a straight-line basis. So you could expect a little bit of a catch-up to what we would expect even run rate.

The other thing I want to mention is, which I think is really key to us, if you remember, the focus on SVA and taking deliberate management actions to make sure that we take 40% of SVA equity business to 70%. So as part of that, in the second quarter, we are also contemplating a couple of exits of businesses that actually will free up capital for us for that to be redeployed or returned. So we will see approximately EUR 100 million or so impact in the second quarter of these decisions that we're taking. Now optically, they go through expenses because we are -- even though the sale closes later. But the good part about this is that everything that we're doing actually is capital accretive. So the relief of the balance sheet will more than offset the expense that we take this quarter. So I would say a couple of things this quarter, you have some normalization of the investment spend. You can think about it whatever the run rate should be and then EUR 100 million or so related to divestitures that will add capital for us down the year.

And on the longer-term perspective, which was your question, absolutely, like knowing what I know now -- as you know, I joined the organization in October, the Investor Day was November. Knowing what I know now and seeing both the AI-related benefits, which everybody has talked about, but specifically for us to be becoming clear by the day. But more importantly, Chris, the simplification opportunities that I see and how we can rescale and refix the organization is giving me a lot of confidence that we can actually outperform our 2028 expense guidance, not just on the cost-income ratio perspective, but on an absolute dollar perspective as well. And this is something that we are actually actively working on. So this gives me confidence that not only will I deliver 2026 expenses, we will deliver the 2028 targets of 13% plus. But because of the expense story, that 13% plus to me is easier now, given that most of it is now going to come from expenses. And if the revenue environment stays constructive, then we have a clear ability to outperform the 13%.

Okay. CLPs, I guess, in some ways, there's a bit of a messy start, frankly, to the year on credit losses. You have the macro overlay, which is understandable, the single name CRE provision. So putting those 2 aside, how are you seeing underlying, I guess, credit trends? And how is the macro overlay becoming, i.e., how are you starting to see it play out in terms of deteriorating underlying credit conditions or not?

So the underlying trends for us versus the previous year are actually playing out what we -- how we expected, which is an improvement over last year, which is what our hypothesis was given that we have taken a lot of pain in the years before. So both on the Private Bank side, Corporate Bank side and Investment Bank, we're seeing the underlying credit trends actually being pretty favorable for us. Now as you know, you mentioned first quarter, we took a couple of decisions. One was obviously a reserve on a specific commercial real estate, but then we also took a management decision to take an overlay given the uncertainty in the environment. And I absolutely think that was the right thing to do. We may not need it. But at that time, I felt like it was prudent for us to do. So I think from an underlying perspective, we expect to see continued improvement as we go through the year.

Now going back to my SVA trend, we are going to make the decision -- we have made a decision that it is worthwhile for us from both a derisking and a capital perspective to exit some nonperforming exposures from -- under the European regulatory rules, these nonperforming exposure actually eat up a lot of capital. So in this quarter, we probably will take EUR 100 million or so impact to exit these nonperforming exposures. Once we exit them out, actually, the amount of capital relief that I get actually way more than offsets the CLP charge. So we will be lower sequentially quarter-over-quarter, perhaps a little bit higher than consensus, but because of the decision that we make. And I think my goal is that as we go through this year, if we see other opportunities to free up capital and derisk our positions that we'll opportunistically take those choices. Despite that, we still believe that the operating profit guidance that we have given for the year stays. So this doesn't change any of that. It just gives us more option about how to deploy capital more productively.

And my final question before I sort of see if we have any in the room was actually exactly on that topic on capital. You said you want to be in the midpoint of the 13.5% to 14% target range. Should we see that as somewhere where you want to land in every single quarter? And where do you see there being perhaps, to your point, increased flexibility, excess above 14%? And within that, what's the expected trajectory for RWAs for this year? That's clearly been a debate earlier on in the year. Any major headwinds either from a business or regulatory side? And the follow-up is going to be on buybacks, then I'll...

Look, I think as we said, we want to operate between 13.5% and 14%. We were kind of smack in the middle of it. The first quarter saw a little bit of RWA growth, a little bit on credit, which we had already assumed that was going to be front-loaded, but we saw some market risk and op risk-related growth in the first quarter given the environment. So I expect that we will run in the rest of the year smack in the middle of our operating range. I think I envision that a 14-plus capital generation is probably like a post-2026 dynamic. But as I mentioned, we are taking 2 actions that are management-driven actions, both on the CLP as well as divestitures that free up capital. We have SRTs that are going into place in '27 and '28, which free up capital. And we have other SVA accretive actions, both in the mortgage book as well as in the trade finance and lending book that will be playing out in the second half of the year and early 2027.

So while our RWA usage was a little bit front-end loaded, a lot of our capital actions are actually coming through late '26 and early '27. So that gives me a lot of confidence that once we are past this, we will be in that situation where we can have that discussion. Now despite the fact that I mentioned that we want to be at 14% post this year, we are already accruing at 60% from a capital return perspective. And our second buyback is not dependent on us being at 14% or not. That's because it's already reflective in our ratio. So my goal really is to free up as much capital and accelerate the SVA actions that we had targeted for '27 and '28 potentially even earlier to wherever we see opportunity.

Okay. Any questions from the audience? Okay. I had a bit of a follow-up on FICC actually. Oh, sorry, there is a hand at the front. If you just wait for the microphone because we're being webcast.

So I have a question in -- a bit more general in what's the view of Deutsche Bank on German industry today? And if you see it as a potential credit problem in the coming months or future and so on. And we all have seen the problems with the high energy costs and so on. So that's why I'm asking. Automobile sector and so on. So a bit the bond, the link Deutsche Bank has with this?

And the second question and it is linked to the first one is what about defense industry? How are you positioned in these trends?

Yes. So look, let me answer your last question first. Clearly, defense was a big imperative for the stimulus program. And what we're seeing is that while it may not be generating headlines, the activity there has already started. Actually, the first quarter was one of our big defense-related financings. So the money is being deployed. The question there is not whether the money will be spent on defense, whether how fast will it be spent. And now we are actually seeing real push by the German government for ministries and other people who are recipients to actually start spending money or losing it because they were going to redirect to other ministries. So we are seeing that. It's not making the headlines, but clearly, part of the corporate bank loan growth that I was talking about, which is over 8% is coming from the defense sector. So putting the growth challenges aside in Germany, which we were expecting to be much higher, at least on the defense side, there's real activity, which is giving us a really good position because, frankly speaking, we are the bank in Germany that has the most defense ties. So that is all right.

When we started last year, German growth was somewhere expected to be over 1%. Obviously, we have now reduced it to almost 0.5%. But most of our German narrative actually is not based on GDP growth. It was based on actually market share and providing more payment services. So I do think there's a little bit of a slowdown. It's lower growth than what was anticipated. But I do -- underneath it, the client activity is still happening. It's just that we are not seeing the kind of things that we would have really liked to see, which was pension reform, which is hugely beneficial to Deutsche Bank. It's probably one of the big deltas for us if that was to happen. And a little bit more on getting investors into Germany, which we had begun to see a lot last year and has slowed down.

So as I mentioned in the beginning of your first question, our medium-term view on Germany remains completely unchanged, and we have been able to perform there as a bank despite lower growth. But on the automobile sector, look, I think Deutsche Bank obviously has a risk appetite to work with the leaders in any particular sector. So in general, that's why we haven't really seen any real credit stress. In the overlay that we took in the first quarter, we took -- part of that was a little bit to see which of the specific industries could be potentially more stressed because of oil prices. But as I mentioned, right now, the inflationary pressures haven't really translated into either a slowdown or a real risk credit issue. If this prolongs and persists for a long time, it could be different. But I do think that the stimulus, at least from a defense perspective, has begun to play out, which was not the case last year.

So I had a follow-up on the comment you made earlier about FICC that you went away and looked at how the FICC franchise has performed in periods of volatility. It sounds fascinating. I guess from the outside, we can see intermediation versus financing, but you can slice the revenues in multiple different ways internally. How should we think about from the outside in trying to understand the predictability and durability of that revenue? Because you talked before in the most recent CMD and prior investor deep dives of how much of the business is corporate versus institutional? How much of the business is German corporates needing the same amount of FX hedging dependent on the trends of the business. So from your perspective, how is that predictability of FICC versus your expectations when you came in and perhaps versus the concerns or questions that analysts and investors have when they look at your FICC business from the outside in?

So look, starting with financing, I also had that question before I came in from the U.S. perspective that how will we compete, how will we do. But what we've really seen is that we've been able to participate, holding our margins and not taking outsized risk. And I think part of this, Chris, is essentially we are the real alternative. I mean as you know, we are the #1 FICC house in Europe by far. In the U.S., our clear aspiration was to be #5. And as I mentioned, this quarter, we took share, which means that there's something that we're doing right in terms of being on the table. So the financing piece of it is -- I would almost -- it's always a debate whether analysts and investors look at FICC financing as a stable revenue or [indiscernible] more like a market-based revenue. And what we have demonstrated is that for us, it has actually been extremely stable, but we are also very clear that we are not going to do financing business at spreads that don't make sense. I think we have enough diversification that I can take that capital to give to wealth management to grow their lending book rather than giving it to FICC financing. So I think over the cycle, you've seen that FICC financing has performed really well.

On the trading side, I think the strength we have is both geography because we are actually pretty sizable in the U.S. Clearly, we are a leader in Europe. We actually have a decent Asian franchise. And the fact that we have FX, emerging markets credit rates, everything plays out to our strength. So the business mix is such that I'm not overly dependent on either one product or one geography. And I think that differentiates us from our European peers for sure. And actually, I would argue that we are probably the only one that can challenge the U.S. banks at this stage on the FICC side.

Okay. And then sort of my final follow-up question was on Private Bank. So you talked a little bit about some of the SVA measures in the second quarter. Again, looking at the business, loans have been sort of declining slightly, but deposits have been growing. But some of that may be deliberate decisions you're making in terms of the economics of some of that exposure. So is that just ebbs and flows? Or what does the underlying theme look different to that? And then perhaps more in the longer term, you talked about if interest rate hikes that are currently being priced into the market start to come through, that will change the NII picture in these businesses. How should we think about the mix of revenue, NII versus fees in the private bank over, let's just say, through the duration of the plan through to '28?

So both growing both -- obviously, the Private Bank has 3 main priorities: Grow lending in wealth management, shrink lending in the unprofitable mortgage book. So when you see the loan dynamic being slightly flat, it's basically all the lending in wealth management, which is what we really want, is being offset by the reduction in the mortgage risk book that we had talked about at the Investor Day. So if you look at the net new lending, actually, it's pretty healthy, but we are actually trying to accelerate exit out of these non-SVA credit portfolios.

Deposits, clearly, what we have shown is that we have held our own despite campaigns from other banks outside, despite promotions, we've been able to attract new money and do really well. And then I think we already talked about client assets as being the third pillar of that. So that's the dynamic. Deposit growth as per plan, loan, 2 dynamics. Whatever we are taking out of mortgages, we're redeploying into wealth management lending and getting clients, I think. So that's kind of the way I think about it.

And sorry, I did say that was my final follow-up. And then you just said something about deposit competition in Germany, which has got me excited. So do you think there is clearly a little bit more competition. The competitive dynamics are different this year versus last year. Are you seeing that at all in your business in general?

No, clearly, there's competition, but it is not new. I mean, I think maybe if you change -- the names have changed. Last year was a Spanish bank given promotions. This year, obviously, we have a large U.S. bank wanted to do. But remember, the amount of deposits we're trying to raise and we have 20 million clients. So we are not going after brand-new clients to raise deposits. We already have the funnel set up. They already have a relationship with us, whereas a lot of the incumbents, what is happening is they're coming with very aggressive promotions, which, by the way, we never match. We always try to be not the highest paid. And what we have shown is that we've been able to still get -- we actually go with the campaign at the same time when somebody else comes in, just to prove out our hypothesis. So there will be a campaign. The question would be who is more likely to lose deposits if a large U.S. bank was to enter? Is it going to be Deutsche Bank, which is bread and butter relationship-driven multiple product bank? Or is it a single product digital offering bank that actually was only competing on rate, and as soon as that rate expires, they lose deposits. So I think what gives us a little bit more confidence, we still have to be competitive in our offering, is that people have to make a trade-off not between Deutsche Bank and an American bank, but where their money is today, which is potentially with the bank that the only relationship that they had was based on the promotional rates.

Okay. Thank you very much.

Thank you. Thanks for having me.

Ladies and gentlemen, welcome to the Q1 2026 Fixed Income Conference Call and Live Webcast. I'm Moritz, 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 Philip Teuchner, Investor Relations. Please go ahead.

Good afternoon or good morning, and thank you all for joining us today. On the call, our Group Treasurer, Richard Stewart, will take us through some fixed income-specific topics. For the subsequent Q&A session, we also have our CFO, Raja Akram, with us to answer your questions. The slides that accompany the topics are available for download from our website at db.com. After the presentation, we will be happy to take your questions.

Before we get started, I just want to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. Therefore, please take note of the precautionary warning at the end of our materials. With that, let me hand over to Richard.

Thank you, Philip, and welcome from me. We are very pleased with our first quarter performance. We proved our resilience in an environment of heightened uncertainty and delivered record net profits as we continue to build on our strong foundations. Both our key metrics improved over the already strong prior year quarter. Post-tax return on tangible equity rose to 12.7% and our cost-to-income ratio improved to below 59%. This gives us a strong start on our path towards our targets. We generated revenues of EUR 8.7 billion, up 2% or 6% excluding FX impacts, even against the strong performance in the prior year quarter, driven by focused growth areas and improving business mix. Costs reflect disciplined execution of our strategy. We self-funded investments by realizing efficiencies as planned. Our capital position is solid. We finished the quarter with a CET1 ratio of 13.8%, well within our operating range of 13.5% to 14%.

Looking at our divisional performance on Slide 3, 2 points are clear. First, earnings mix and balance are improving. Our non-investment banking businesses with more predictable earnings streams account for a larger share of group profits compared to the same quarter of last year. Second, we have delivered strength across the board. All 4 divisions achieved a return on tangible equity of either close to or well above 13%. The Private Bank increased client assets by EUR 30 billion since the start of the year with net assets under management inflows of EUR 11 billion, primarily driven by investment products.

Asset Management achieved EUR 11 billion of total net flows, mainly in passive and cash. And DWS agreed to acquire a 40% minority stake in Nippon Life India Alternative Investment Fund, reinforcing our asset gathering capacity. Corporate Bank saw sustained momentum in growing business volumes year-on-year with loans up 6% and deposits up 2%. Investment Bank performance was again very solid this quarter. We continue to support our clients in volatile markets with client activity up 8% despite a very strong prior year.

Some thoughts on Slide 4 on our strategic direction in a dynamic operating environment, where recent geopolitical developments continue to underscore the importance of resilience and disciplined execution. While the outlook for the global economy might be uncertain, the current conflict underlines Europe's need for self-reliance and strategic autonomy and investment in defense and other capabilities.

When it comes to Germany, we want to reiterate that despite lower forecasted growth rates in 2026, our medium-term view is unchanged as there are tailwinds from fiscal stimulus, and we see scope for further measures going beyond the reform framework announced earlier this month. We will continue to actively leverage our leadership position in Germany. We see significant growth opportunities, including private sector investments and reforms and defense and infrastructure plans.

From a risk perspective, we have very limited direct exposure to the Middle East. Our portfolio performance remains well within our expectations, and we continue to monitor clients across industries. And in line with our disciplined risk framework, we put in place a management overlay to reflect broader macroeconomic uncertainties. Looking ahead, we reaffirm our confidence in reaching our strategic goals and 2028 financial targets. And much of the upside we talked about in November is already visible, providing operational flexibility to reach our financial plan and create potential for further outperformance.

We are encouraged by the progress made across our levers and the enhanced collaboration across our divisions. AI is advancing rapidly, and we are working closely across businesses and functions to make sure we deliver maximum productivity and enhance client experience. Overall, we see positive momentum in our operating environment.

Turning to treasury-specific topics, starting with our net balance sheet on Slide 5. We continue to operate with a strong conservative balance sheet, underpinned by robust capital and liquidity buffers that comfortably exceed regulatory requirements and support the group across cycles. Loans and deposits continue to be of high quality, underpinned by a strong domestic footprint and a large base of insured retail deposits. Our funding profile is well balanced, anchored in a stable deposit base and long-term issuances. This strength allows us to support clients, absorb volatility and invest selectively in growth opportunities.

Moving to capital on Slide 6. Starting with the CET1 ratio, we ended the quarter at 13.8%, down 38 basis points compared to the fourth quarter, but squarely in line with our target operating range. Net income, net of deductions for AT1 coupons contributed 53 basis points, reflecting strong first quarter earnings, while deductions for distributions of 32 basis points represent a 60% payout ratio from 2026. Other deductions of 11 basis points mainly relate to equity compensation, partly offset by reduced capital deduction items.

Turning to risk-weighted assets. RWAs increased by EUR 12 billion, excluding FX effects of EUR 2 billion. This was driven mainly by EUR 6 billion of business growth in credit risk RWA, notably in loans in the Corporate Bank and Investment Bank, but also from derivatives and secured financing transactions. Market risk contributed an additional EUR 2 billion of RWA. Other includes changes in operational risk RWAs and smaller model effects from updates to existing models. Our capital ratios remain well above regulatory requirements, as shown on Slide 7. The CET1 MDA buffer now stands at 260 basis points or EUR 9 billion of CET1 capital. The quarter-on-quarter decrease reflects the lower CET1 ratio from our business growth investments, net of the reduction in the CET1 ratio requirement.

The buffer to the total capital requirement is 270 basis points, a further decrease compared to the CET1 MDA, mainly from the AT1 call and Tier 2 maturity haircuts. On the leverage side, we ended the quarter at 4.4%, which is 12 basis points down versus the prior quarter, leaving us with an MDA buffer of EUR 12 billion. The increase of EUR 2 billion compared to the prior quarter is driven by a reduction in our minimum requirement from 3.85% to 3.6%, offset by a reduction in capital from our AT1 call and the increase in leverage exposure.

We continue to operate with significant loss-absorbing capacity well above all requirements as shown on Slide 8. Compared to the presentation in the prior quarter, we now show the requirements in percent of RWA instead of absolute euro numbers. On the right-hand side of the slide, we show our MREL surplus, both as a ratio as well as in absolute euro numbers. The MREL surplus of EUR 17 billion continues to provide us with the flexibility to pause issuing new eligible liabilities for at least 1 year. The MREL requirement will reduce by approximately 100 basis points in the second quarter based on the decision we received from the resolution authorities. This will increase our surplus by around EUR 3.5 billion.

On Slide 9, we can see that our liquidity and funding profile remained very strong in the first quarter. Our liquidity coverage ratio was 140%, which keeps us comfortably above the regulatory minimum. Compared to the seasonally elevated year-end position, both HQLA and the surplus requirements normalized in the first quarter, while the overall liquidity position remained robust. We ended the quarter with EUR 245 billion of high-quality liquid assets and the composition of that buffer continues to be very strong with the large majority held in cash and Level 1 securities.

The daily average LCR for the quarter was 139% (sic) [ 140% ] very close to the quarter end level, which underlines the consistency of our liquidity position throughout the period. Our net stable funding ratio was 119%, while available stable funding increased to EUR 651 billion. Overall, this continues to underscore the resilience and diversification of our liquidity and funding base.

Looking at the development of the loan book on Slide 10. During the first quarter, loans grew by EUR 5 billion, adjusted for FX effects. The underlying quality of the loan book remains strong, reflecting our conservative underwriting standards across all businesses. In the Private Bank, we continue the intended portfolio rebalancing by growing our Wealth Management franchise and delivering further reductions in the German mortgage book. Loans increased in the Corporate Bank, where we saw encouraging growth in our trade finance business. Within FIC financing, the steady growth path continued driven by new loan originations across segments. For the remainder of the year, we see further growth opportunities across all businesses, while our focus remains on value accretion and capital discipline.

Moving now to deposits on Slide 11. Our well-diversified deposit book reduced by EUR 8 billion to EUR 687 billion during the first quarter, adjusted for FX effects. The reduction in the group deposit base is primarily driven by the Corporate Bank, where we saw a normalization of balances from the year-end spot peak in line with our expectations and prior guidance. In the Private Bank, deposit balances remained broadly stable, supported by continued underlying campaign inflows in Germany. The portfolio continues to be of high quality, supported by a strong domestic footprint and a substantial level of insured retail deposits. Looking ahead, our focus remains on maintaining a high portfolio quality and growing SVA-accretive deposits, both in the Private Bank and Corporate Bank.

Moving to net interest income on Slide 12. NII was strong at EUR 3.5 billion in the key banking book segments and other funding. Deposit-related NII has been stable over the past year as we have successfully offset the headwinds from interest rates with volume growth in our hedge portfolio and anticipate tailwinds going forward. Looking at the divisions, the Private Bank continued to show steady margin progression driven by increasing deposit revenues in both Personal Banking and Wealth Management. The Corporate Bank net interest income was stable with clear signs of the rate headwinds on deposit NII diminishing compared to the prior quarter.

In FIC financing, revenues remained strong, supported by ongoing loan growth. For the full year 2026, we expect NII across key banking book segments and other funding to increase to around EUR 14 billion. The performance in the first quarter and the current view for long-term rates gives us conviction for the 2028 targets we outlined at the IDD. On Slide 13, which is based on the market implied forward rates as per the end of March, you can see that the hedge portfolio provides increasing annual contributions. The yield of maturing hedges this year is around 40 basis points on average. These hedges are reinvested at the current 10-year swap rate of around 3%. More than 90% of the hedge contribution for 2026 is locked in given our rolling structure. The total volume invested longer term stands at around EUR 200 billion. While the growth of the hedge portfolio income will depend on future market developments, we currently see a positive slope at least until 2030.

Let us now look at our issuance plan on Slide 14. Markets have obviously been challenging due to geopolitical uncertainty. And as a consequence, primary market activity has been lower than usual. Nonetheless, we have continued to make progress on our issuance plan. As of end of April, we have issued a total of EUR 6 billion out of our EUR 10 billion to EUR 15 billion plan for the year, mainly driven by 5 benchmark transactions in 3 currencies. Following the EUR 1 billion Tier 2 transaction in January, we issued our tightest U.S. dollar-denominated Senior non-preferred bond in early February as well as a EUR 500 million Senior Green non-preferred bond, our first under the European Green Bond format.

Later in March, we further diversified our investor base and issued our first multi-tranche Panda bond transaction totaling CNY 5.5 billion. This represents the largest Panda bond issuance by a commercial bank so far. In early April, we issued our second U.S. dollar-denominated Senior non-preferred transaction this year, which despite the geopolitical uncertainty, attracted over EUR 6 billion in total orders. This allowed us to price a $1 billion transaction with minimal concession. We also successfully completed a tender offer for several of our Pfandbrief benchmarks, repurchasing EUR 1.6 billion, which will help manage our Pfandbrief curve going forward.

To sum up on Slide 15. First, we are confident in our revenue ambition of around EUR 33 billion, supported by key banking book NII and other funding growing to around EUR 14 billion as well as growth in net commission and fee income. The market implied expectations around interest rates are a tailwind and adding to our conviction around this number. Second, as demonstrated, we remain firmly committed to disciplined strategy execution. On costs and our investment plans, we confirm our expense guidance and expect a gradual increase throughout the year, in line with what we said at the IDD, while retaining flexibility.

In the second quarter, we expect increases in expenses, primarily from restructuring and severance costs in the Private Bank to support our business-led front-to-back optimization agenda and generate in-year efficiencies as well as hiring across divisions. Third, we reiterate our guidance for provision for credit losses for 2026. Asset quality remains strong and portfolios are performing in line with expectations.

We remain vigilant given the evolving macroeconomic environment and took a management overlay, which may not be eventually needed when the Middle East situation normalizes. Fourth, we are comfortable with the trajectory in profitability and continue to expect strong operating performance in 2026.

Finally, we are well progressed with our issuances after an active first quarter and reflecting the lower senior issuance requirements for this year.

With that, we look forward to your questions.

[Operator Instructions]

And the first question will come from Yan Zhu from Autonomous.

3 questions, please. The first one is on MREL. At Q4, you discussed a potential senior nonpreferred downgrade at Moody's due to the lower issuance. So we would like to understand, is there still the case? And when do you expect this to happen ? [Technical Difficulty] outlook for this year and beyond? And what is the upside from the higher rate? And lastly, on RWA, can you also comment on your RWA expectations following the strong increase in the first quarter, please?

Apologies, I couldn't quite hear all of your questions. But I think there was a question on RWA growth. I think there's one on NII, but I didn't quite catch the first one on -- was on MREL and Moody's, but I couldn't quite understand the question. If you could just repeat it?

The Moody's one related for MREL. So we see it we want to understand if this is still the case, and when do you expect this to happen? And do you expect any CMDI reated rating action as well?

Okay. So why don't I sort of take them in -- let's deal with the first one, then so on MREL. So as you know, in Q -- what we announced in January that we're going to give up the LGF times in the LGF 10% Moody's rating uplift that we had. And as you know, Moody's then did come out with an announcement in February, which said that our deposit rating would be moved to positive outlook and our issuer rating for senior preferred rating will be stable. And what that does and how we kind of -- how we think about that is we kind of think that Moody's is already reflecting the potential impacts from CMDI and LGF to some degree with that reflection in the senior rating.

So there's a positive outlook on the deposits and stable on the senior preferred rating. There is no specific rating for Senior nonpreferred doesn't come with a dedicated outlook. So what we're saying is that Moody's has already, in our opinion, kind of reflected the impact in its assessment of us. So positive for deposits, stable for senior preferred, that's both -- in our opinion, reflecting LGF and the CMDI regulation. And so what we're trying to do is work with them, just try and minimize that rating volatility. So we'll be able to resolve the fundamental outlook on the deposits as well as the final action CMDI without too much impact from today's ratings. So hopefully, that clarifies your question.

In terms of NII outlook, in general, higher rates are beneficial for Deutsche Bank's NII, as you can consistently see in our sensitivity disclosures. Current market implied rates are higher than what we use for planning for IDD at both the long and the short end, which will result in tailwinds compared to our expectations, both this year and in 2028. Our remaining sensitivity, as you can see from the slides, is quite limited for 2026, but we still have a material portion of our hedge book to roll over by 2028. So the tailwind there remains subject to developments in market conditions.

Now while we're not changing our overall revenue guidance for 2026 nor '28, the interest rate developments clearly support confidence in meeting and potentially outperforming those targets that we have laid out. And then in terms of RWA expectations, so let me start by saying that the first quarter RWA increase that you saw was a bit exceptional for us, driven by a few factors. And the growth in the first quarter can certainly not be extrapolated to future quarters. So first of all, the quarter-on-quarter increase included EUR 2 billion for FX moves. It also included EUR 2 billion higher market risk RWA, reflecting a lower year-end 2025 starting point and sort of a more normalized kind of level, reflecting also the first quarter volatility.

And then operational risk RWA equally rose by EUR 2 billion. We don't expect either of these to repeat in the second quarter. The second point I'd make is ex FX, credit RWA grew by EUR 8 billion in the quarter, mostly in the Investment Bank, where we executed on market opportunities in our financing businesses, but also saw increases related to market volatility, notably in derivatives and SFT related credit exposure. This explains EUR 6 billion of the EUR 8 billion credit RWA growth. And then the Corporate Bank and Private Bank explained the balance, whereby growth was much more moderate around EUR 1 billion in each division.

And then let me just sort of take you back to what we said at IDD last year. So the Private Bank, we will reduce RWA from exiting sub-hurdle mortgages whilst increasing capital deployment in Wealth Management. That's kind of part of the strategy. And then also in the core bank, we will optimize within our trade finance and lending book, exiting negative SCA portfolios and shifting to more rewarding relationships. And to be clear, when doing this, the value from the overall clients is paramount for us and not just individual asset returns.

And so when we bring all that together, we expect significantly lower business-driven RWA growth in the second quarter and thereafter, nothing comparable to what we saw in the first quarter. And of course, the RWA benefits from new SRT transactions will also continue to improve the velocity of the balance sheet and free up additional RWA capacity throughout the year. So I hope that gives you a little bit more color as to what we're thinking around RWA for the rest of the year.

And the next question comes from Lee Street from Citigroup.

The first one, I'd just like to ask about your thoughts on UniCredit's tender for Commerzbank, but specifically in terms of the impact on the banking sector in Germany, any potential impact you might see on Deutsche Bank's competitive position domestically? And I guess, finally, just obviously, the German government had a very strong pushback, what you think that means for European Banking Union, cross-border M&A, all those type of things? That would be my first question.

And the second question, again, on RWAs and it links to the last question, but there's obviously been an increase in the share of investment bank risk-weighted assets over recent quarters. Also, you're taking actions to lower some of the RWAs in the Private Bank and Corporate Bank. Should I be expecting the share of Investment Bank RWAs of overall RWAs to carry on increasing? Is there an upper limit? That would be my questions.

This is Raja. Let me take the questions. Look, well it's not in my position to comment on potential transactions that are in the market between 2 competitors. But I would just reassure you from our perspective, it doesn't change our plan and our strategy or our competitive position. We are a market leader already. In fact, some of the returns and targets that the proposal puts out there as a potential accomplishment of if this merger goes through, we are, from a competitive perspective in Germany are pretty -- are already there. So it does not put us at a competitive disadvantage.

In fact, from my perspective and our perspective, if this transaction does go through, I think there is certainly an opportunity for Deutsche Bank to, in certain cases, take market share. If you look at the corporate banking side, most clients would like to have at least a couple of corporate banking relationships and in certain instances, their relationships might be the 2 banks that actually end up merging. So from our perspective, we could see an outcome where actually this might actually be slightly net positive for us. We certainly don't see it as a disadvantage. Our banks compete on being global with a 60-country network. Most of the clients that we serve want products and investment banking advice along with just pure domestic corporate banking relationships.

So net-net, I think whether this merger goes through or doesn't go through doesn't change our strategy, but I could see envision situation where it actually turns out to be a little bit net positive, both in terms of talent as well as from a client intake perspective. Now on the whole, I think, obviously, the German government has its position, but the German government has also been very clear that we are -- and we are also very supportive that we need to make Europe more competitive, and there should be an ability for more cross-border merger. I don't think that's necessarily a bad thing, whether it's in the financial services sector or outside of financial services sector. So I think anything that makes Europe more competitive from my perspective and our perspective is welcome.

It relates to your RWA question, I think Richard explains that this was a little bit of an unusual quarter from us from an RWA growth perspective because obviously, the market risk RWA primarily impacts also IB. And the other thing that you have to see is that we are actually really growing the asset-light part of our businesses, meaning asset management and corporate banking as well as private bank. They naturally take and consume less RWA than the Investment Bank. So in essence, if we continue to grow those businesses and maintain our competitive position in certain quarters, it might look like a bigger chunk of the RWA allocation went to IB. But that's not the strategy that we are going with.

At the Investor Day, I think if you look at our Investor Day guidance, we basically said that the consumption of -- the portion of RWA consumed by the Investment Bank is going to kind of stay the same as it was in '25, but with obviously a much larger contribution, which means even inside the Investment Bank, we're going to try to grow the capital-light businesses.

So now I think -- I don't think that, as Richard said, I don't think you should extrapolate the RWA growth this quarter as something that would be repetitive, neither should we look at the percentage of RWA allocated to IB as a new normal or an aspired state. Our goal is to actually keep our best-in-class business performing, but at the same time, increase the revenue and the profit before taxes from our non-RWA consuming businesses.

[Operator Instructions] So it looks like there are no further questions at this time. So I would like to turn the conference back over to Philip Teuchner for any closing remarks.

Thank you, Moritz. And just to finish up, thank you all for joining us today. You know where the IR team is if you have any further questions, and we look forward to talking to you soon again. Goodbye, and have a nice day.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for choosing Chorus Call, and thank you for joining the conference. Goodbye.

Ladies and gentlemen, welcome to the Q1 2026 Analyst Conference Call and Live Webcast. I'm Moritz, your Chorus Call operator. [Operator Instructions] The 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 Ioana Patriniche, Head of Investor Relations. Please go ahead.

Thank you for joining us for our first quarter 2026 results call. As usual, our Chief Executive Officer, Christian Sewing, will speak first, followed by our Chief Financial Officer, Raja Akram. The presentation, as always, is available to download in the Investor Relations section of our website, db.com. Before we get started, let me just remind you that the presentation contains forward-looking statements, which may not develop as we currently expect. We therefore ask you to take notice of the precautionary warning at the end of our materials. With that, let me hand over to Christian.

Thank you, Ioana, and good morning from me. We are very pleased with our first quarter performance. We proved our resilience in an environment of heightened uncertainty and delivered record net profits as we continue to build on our strong foundations. Our financial strength enabled us to support clients to make a very solid start to this phase of our strategy and to create value for our shareholders.

Both our key metrics improved over the already strong prior year quarter. Post-tax return on tangible equity rose to 12.7% and our cost/income ratio improved to below 59%. This gives us a strong start on our path towards our targets. We generated revenues of EUR 8.7 billion, up 2% or 6% excluding FX impacts, even against the strong performance in the prior year quarter, driven by focused growth areas and improving business mix.

Costs reflect disciplined execution of our strategy. We self-funded investments by realizing efficiencies as planned. Our capital position is solid. We finished the quarter with a CET1 ratio of 13.8%, well within our operating range of 13.5% to 14%. Strong organic capital generation enabled us to support both business growth and deductions for distributions, which are in line with our new payout ratio of 60%. We also made good progress on the EUR 1 billion share buyback we announced last quarter. Around 60% is already completed, and we will update the market on the next distribution in respect of 2026 in due course.

Let me now turn to the progress we made on scaling the Global Hausbank on Slide 3. We see tangible progress across all 3 levers we outlined at the Investor Deep Dive last November. In respect of focused growth, in our asset gathering businesses, we see clear momentum in both revenues and assets under management, driven by continued net inflows from clients. Strict capital discipline enabled us to deliver positive SVA in the quarter.

We continue to reduce sub-hurdle mortgages in the Private Bank and redeploy resources to Wealth Management and within corporate lending. We also made progress on a scalable operating model, particularly in the Private Bank and Corporate Bank. We are using AI to accelerate core processes, for example, to significantly accelerate the credit process in the Corporate Bank, thus improving client experience, supporting growth and taking out costs.

The franchise performance indicators we discussed in November are also demonstrating progress. Assets under management increased nearly 9% to EUR 1.8 trillion year-on-year or 1% during the quarter as we attracted net flows of EUR 22 billion with around EUR 11 billion each in Private Bank and Asset Management. Loans grew to EUR 486 billion, up by around EUR 4 billion since a year ago or EUR 7 billion since the last quarter.

Deposits were EUR 687 billion, up by EUR 22 billion or 3% since the first quarter last year and were broadly stable compared to the prior quarter. These developments were accompanied by strong performance across our businesses, as you can see on Slide 4. Looking at our divisional performance, two points are clear. First, earnings mix and balance are improving. Our non-investment banking businesses with more predictable earnings streams account for a larger share of group profits compared to the same quarter last year. Second, we have delivered strength across the board with all businesses firing on all cylinders. All 4 divisions achieved a return on tangible equity of either close to or well above 13%.

In the Private Bank, we made strong progress on our transformation agenda. We hired about 100 coverage staff with 80 already on board, and we are ahead of schedule on branch closures with around 75% completed for 2026. The Private Bank increased client assets by EUR 30 billion since the start of the year with net AUM inflows of EUR 11 billion, primarily driven by investment products.

Asset Management achieved EUR 11 billion of total net flows, mainly in passive and cash. And DWS agreed to acquire a 40% minority stake in Nippon Life India Alternative Investment Fund, reinforcing our asset gathering capacity. Corporate Bank saw sustained momentum in growing business volumes year-on-year with loans up 6% and deposits up 2%. Investment Bank performance was again very solid this quarter.

We continue to support our clients in volatile markets with client activity up 8% despite a very strong prior year. And we are pushing forward the Investment Bank's commitment to innovative tech-led solutions. We launched a partnership with BlackRock, integrating our multi-award-winning HausFX technology suite into their Aladdin platform. This collaboration represents a significant step forward in delivering automated and cost-efficient FX solutions to the global asset management industry. Before I hand over to Raga, I want to share my thoughts on our strategic direction in a dynamic operating environment, where recent geopolitical developments continue to underscore the importance of resilience and disciplined execution, but also underline our Global Hausbank strategy.

While the outlook for the global economy might be uncertain, the current conflict underlines Europe's need for self-reliance and strategic autonomy and investment in defense and other capabilities. When it comes to Germany, we want to reiterate that despite lower growth estimates in 2026, our medium-term view is unchanged as there are tailwinds from fiscal stimulus, and we see scope for further measures going beyond the reform framework announced earlier this month.

And we will continue to actively leverage our leadership position in Germany. As we explained in November, we see significant growth opportunities, including private sector investments and reforms and defense and infrastructure plans. For example, Deutsche Bank is part of a EUR 150 million long-term finance package for Quantum Systems, a Munich-based aerial defense systems company. We remain focused on supporting our clients in this dynamic environment. The strength of our balance sheet, combined with our service capabilities and strategic positioning means we are best placed to advise clients at European and global levels.

From a risk perspective, we have very limited direct exposure to the Middle East, and our portfolio performance remains well within our expectation, and we continue to monitor clients across industries. And in line with our disciplined risk framework, we put in place a management overlay to reflect broader macroeconomic uncertainties. Looking ahead, we reaffirm our confidence in reaching our strategic goals and 2028 financial targets.

Our first quarter results with returns of 12.7% show the strength of our strategy. And much of the upside we talked about in November is already visible, providing operational flexibility to reach our financial plan and create potential for further outperformance. We are encouraged by the progress made across our levers and the enhanced collaboration across our divisions.

AI is advancing rapidly, and we are working closely across our businesses and functions to make sure we deliver maximum productivity, enhance clients' experience. We see positive momentum in our operating environment. For example, EU policymakers continue to focus on European and banking competitiveness, including a more integrated capital market that would be very beneficial for European banks, in particular, Deutsche Bank. To sum up, we are strongly positioned to execute our scaling the Global Hausbank strategy and deliver on our targets. With that, let me hand over to Raja.

Thank you, Christian. It feels great to be beginning my role as CFO with such strong results. It comes as we move into the next phase of our strategy, and I'm excited to be part of this journey.

Before I turn to the financials, a few comments on our revamped earnings deck. You will see some changes to the presentation format today, reflecting alignment with the strategy we outlined at our Investor Day and highlighting clear focus on execution, delivery and accountability as we shift gears to scaling the Global Hausbank. We promised in November that we'll give you regular updates on our performance indicators over the next 3 years, and this is what we are doing today.

Let me now turn to the performance for the quarter. We delivered a solid first quarter with net revenues of EUR 8.7 billion, a return on tangible equity of 12.7% while maintaining a strong CET1 ratio of 13.8%. Profit before tax increased 7% year-on-year with broad-based contributions across the divisions. I'm particularly pleased with the performance in the asset gathering businesses and the corresponding greater pretax contributions of the Private Bank and Asset Management, both of which saw strong growth.

The Corporate Bank return on tangible equity and performance indicators demonstrate visible underlying momentum, while the Investment Bank performance was solid against a strong prior year quarter. We showed discipline on cost with the cost-income ratio improving to 58.9%. FX had a continued negative impact on revenues and a positive effect on expenses this quarter. On a net basis, these movements had a negative impact on profitability.

We are introducing a new disclosure on appendix Slide 23, which provides transparency on FX translation impacts for select P&L and balance sheet items to highlight how these impact operating performance. Overall, notwithstanding the FX headwinds and against a dynamic backdrop, revenues continue to grow faster than costs, reflecting disciplined execution against our strategy.

Let me now turn to revenues in more detail, starting on Slide 8. Net revenues were slightly higher year-on-year at EUR 8.7 billion, up 6% if adjusted for FX, reflecting growth across the franchise. We saw strong growth in the Private Bank, underpinned by both Personal Banking and Wealth Management. Asset Management was also up and benefited from higher performance fees related to an infrastructure fund. Corporate Bank revenues were impacted as expected by FX and interest rate headwinds compared with the prior year period, which are already beginning to subside.

Underlying business momentum is encouraging with an increase in both loans and deposits year-over-year. First quarter Investment Bank revenues were broadly flat year-on-year despite significant market volatility and FX headwinds. FIC revenues were essentially flat compared to a record prior year quarter with IBCM slightly higher from improved debt and equity original performance. Looking at revenue composition, net interest income year-on-year revenue trends were impacted by accounting asymmetries, which benefited net interest income and offset trading and other revenues.

Even adjusting for this, net interest income still saw a solid increase driven by volume growth and hedge rollovers with trading and other income broadly flat year-on-year. Net commission and fee income performance showed continued strength, also benefiting from the higher performance in asset management. Overall, I'm very happy with the evolution of our revenues. Our non-investment banking businesses now contribute over 61% to our revenue mix.

Let me now move to NII on Slide 9. NII was strong at EUR 3.5 billion in the key banking book segments and other funding. Deposit-related NII has been stable over the past year as we have successfully offset the headwinds from interest rates with volume growth in our hedge portfolio and anticipate tailwinds going forward. Looking at the divisions. The Private Bank continued to show steady margin progression driven by increasing deposit revenues in both Personal Banking and Wealth Management.

The Corporate Bank net interest income was stable with clear signs of the rate headwinds on deposit NII diminishing compared to the prior quarter. In FIC financing, revenues remained strong, supported by ongoing loan growth.

For the full year 2026, we expect NII across key banking book segments and other funding to increase to around EUR 14 billion. The performance in the first quarter and the current view for the long-term rates gives us conviction for the 2028 targets we outlined at the IDD. You can find details on the benefit from the long-term hedge portfolio rollover on Slide 25 of the appendix.

While turning to Slide 10, you will notice 2 changes. First, we are focusing on noninterest expense rather than adjusted costs as we said we would at the Investor Day. Second, we're presenting noninterest expense using the same categories at the Investor Day. On that basis, noninterest expenses were down 2% year-on-year at around EUR 5.1 billion. Incremental investments, particularly in technology and hiring across Wealth Management and IBCM were largely offset by operating efficiencies while volume-related growth and inflation-driven expenses were the other main drivers.

Importantly, we delivered operating efficiencies of around EUR 100 million in the first quarter already, supporting our multiyear efficiency ambition. These included headcount and target operating model measures alongside noncomp optimization. In short, this reflects our disciplined cost and investment culture, keeping plans aligned with the external environment, focusing on execution and developing capabilities to deliver our long-term targets.

With that, let me turn to provision for credit losses on Slide 11. Starting with asset quality, overall portfolio performance remains strong. Provision for credit losses was EUR 519 million, reflecting additional reserves on a single name CRE exposure in the Investment Bank. In addition, we took a decision to take a macroeconomic management overlay. Excluding the single name item, CRE provisions would have been materially lower on the quarter.

Our higher-risk CRE portfolio has materially reduced since 2022, the remaining risks focused on a small subset of existing defaults, which reinforces our confidence in the headwind subsiding. As I mentioned, first quarter provisions include a EUR 90 million management overlay, reflecting a forward-looking approach in a dynamic macroeconomic environment in light of the Middle East conflict.

Adjusted for these effects, underlying portfolio performance is in line with expectations and supporting a normalized average run rate for provisions of roughly 30 basis points through 2028, as discussed at the Investor Day. And within private credit, performance is stable with no losses and the portfolio is broadly unchanged. We take a highly selective approach to new business and continue to apply disciplined underwriting standards. The early transparency we provided last year and in our recent annual report came from a position of confidence in our portfolio.

Turning to capital on Slide 12. As with costs, you will see a change in presentations in this slide. We're putting greater focus on the CET1 ratio itself and the underlying drivers with risk-weighted assets shown as a key input given our growth agenda. Starting with the CET1 ratio, we ended the quarter at 13.8%, down 38 basis points compared to the fourth quarter, but squarely in line with our operating range.

Net income, net of deductions for AT1 coupons contributed 53 basis points, while deductions for distributions of 32 basis points represent the 60% payout ratio from 2026. Other deductions of 11 basis points mainly relate to equity compensation, partly offset by reduced capital deduction items.

Turning to risk-weighted assets. RWAs increased by EUR 12 billion, excluding FX effects of EUR 2 billion. This was driven mainly by EUR 6 billion of business growth in credit RWA, notably in loans in Corporate Bank and the Investment Bank, but also from derivatives and secured funding transactions. Market risk contributed additional EUR 2 billion of RWA.

Other include changes in operational risk RWAs and smaller effects from updates to existing models. As mentioned earlier and building on performance indicators introduced at the IDD in November, we have also refined the divisional pages to sharpen the focus on execution and provide a clear view of our strategic progress.

Let's now turn to divisional performance, starting with the Private Bank on Slide 14. Private Bank delivered a strong first quarter performance with profit before tax up 39% year-on-year and a 7% operating leverage. We are very pleased with the trajectory of revenues, expenses and attracting new client assets, a key goal for us.

Client assets increased by 4% sequentially to EUR 821 billion or by 6%, excluding market and FX impacts, of which EUR 694 billion were assets under management, which marks the highest level ever. Client activity remains strong with net assets under management inflows of EUR 11 billion predominantly into higher fee investment products. Record revenues of EUR 2.6 billion, up 5% year-on-year were driven by a 13% increase in net interest income and slightly higher net commission and fee income.

Personal Banking revenues increased by 5%, mainly from deposit revenue growth, partly offset by lower revenues from other banking services. Wealth Management revenues grew by 5%, driven by higher deposit revenues and continued growth in discretionary mandates and capital market products despite elevated market volatility late in the quarter. Noninterest expenses are slightly down 1%, mainly reflecting ongoing cost discipline, lower severances as well as select targeted investments.

The cost/income ratio improved by 4 percentage points to 67% for the quarter. We will continue with our investment initiatives in the Private Bank throughout the year, including hiring in Wealth Management. Lower provision for credit losses reflects improved credit quality. Let me also add that over the past 2 years, the Private Bank has more than doubled its return on tangible equity and reduced its cost/income ratio by 15 percentage points.

Over the same period, client assets grew by 20%, driven in particular by a 24% increase in investment products. In this first quarter alone, Wealth Management generated more than EUR 9 billion of investment product inflows, setting us up for a beat of 2025 inflows, nearly matching the full '25 inflows in just the first quarter. These results underscore the strength of the business and its significant growth potential.

Turning to Slide 15 to Asset Management segment. Return on tangible equity improved by 27 percentage points to 50%, with profit before taxes increasing by 37% year-on-year, driven by higher revenues and lower costs. As a reminder, and as outlined at our Investor Day, the return on tangible equity calculation now reflects the full allocation of the regulatory capital minority interest benefit to the Asset Management segment.

Revenues rose by 10% versus the prior year quarter as performance fees increased significantly, primarily due to the earlier-than-anticipated recognition of significant fees from an infrastructure fund. This was supported by higher management fees, reflecting an increase in average assets under management. Other revenues declined year-on-year, mainly reflecting valuation of guaranteed products.

Noninterest expenses decreased by 5%, mainly due to lower variable compensation and a reduction in noncompensation expenses, including litigation. The combination of higher revenues and lower costs resulted in a cost/income ratio of 55.5%, an improvement of almost 9 percentage points compared to the prior year.

Turning to flows. Quarterly net inflows amounted to EUR 11 billion with long-term flows of around EUR 7 billion remaining a key growth driver, especially flows in passive products, including Xtrackers. Cash had positive inflows of approximately EUR 5 billion as clients became more risk averse due to the dynamic macro backdrop. Total assets under management increased further driven by net inflows of EUR 11 billion and positive FX effects of EUR 8 billion, partially offset by negative market impacts of EUR 10 billion, primarily related to the recent market volatility. For further details, please see DWS' disclosure on the Investor Relations website.

Let's move to the Corporate Bank on Slide 16 before closing with the Investment Bank. The Corporate Bank started the year with a strong return on tangible equity of 14.8%, up compared to the prior year quarter and a cost/income ratio of 63%. As previously discussed, Corporate Bank revenues will be impacted by FX and interest rate headwinds in the first half of the year, but the end to that is clearly in sight.

On a reported basis, revenues in the first quarter were down 3% versus the prior year period. Adjusted for FX movements, Corporate Bank revenues were up 1% year-on-year and 5% growth in net commission and fee income and 2% growth in net interest income, offset by a mark-to-market adjustment on an investment. This mark has already partially reversed in April given improved market conditions.

In terms of business performance, Corporate Treasury Services and Business Banking benefited from interest rate hedges and higher business volumes, while Institutional Client Services revenues were lower, driven by FX movements and the aforementioned mark-to-market. Business volumes were strong with average deposits and loans both higher year-on-year and sequentially and spot deposit balances normalizing from the elevated levels at the year-end.

Compared to the prior year and adjusted for FX movements, deposits increased by 5% on a spot and 8% on an average basis, primarily driven by higher site deposits in corporate cash management and loans were up by 8% with strong growth in trade finance. Noninterest expenses were essentially flat as volume-related growth and investments into our platforms were offset by FX movements.

Provision for credit losses was lower during the quarter despite the management overlay, reflecting the quality of our book. Looking ahead, we expect revenues to improve sequentially from here with an expected revenue growth in the mid-single digits on a reported basis as we exit the year supported by both fee and NII income.

I'll now turn to the Investment Bank on Slide 17. Revenues for the first quarter were essentially flat year-on-year despite the impact of macroeconomic and significant FX headwinds and against a record first quarter of 2025 in FIC. FIC Markets was slightly lower year-on-year due to reduced revenues and rates, partially mitigated by strength in FX.

Overall, the business demonstrated resilient performance in volatile markets. FIC financing continued to grow year-on-year with revenues increasing 7%. Moving to IBCM. Revenues were slightly higher, driven by improved performance in debt and equity origination. The prior year was impacted by a loss on the sale and markdown of a specific loan in LDCM. We continue to see strength in investment-grade debt with the business increasing market share by 50 basis points compared to the full year 2025.

While the business did see a clear impact to the capital market issuance activity in the last few weeks of the quarter as a result of the Middle East conflict, market sentiment has improved in April with the pipeline for the second quarter pointing towards revenue growth year-on-year. Noninterest expenses were essentially flat year-on-year with targeted investments and higher than other expenses offset by favorable FX impacts. Provision for credit losses was EUR 290 million, driven by the larger single name exposure and the management overlay I mentioned earlier.

With that, I will turn to the outlook on Slide 18. Looking ahead, I'd like to close with the following. First, we are confident in our revenue ambition of around EUR 33 billion, supported by key banking book NII and other funding growing to around EUR 14 billion as well as growth in net commission and fee income. The expectations around interest rates are a tailwind and adding to our conviction around this number.

Second, as demonstrated, we remain firmly committed to disciplined strategy execution. On cost and our investment plans, we confirm our expense guidance for 2026 and expect a gradual increase throughout the year, in line with what we said at the Investor Day while retaining flexibility. In the second quarter, we expect increases in expenses, including from restructuring and severance costs in the Private Bank to support our business-led front-to-back optimization agenda and generate in-year efficiencies as well as hiring across divisions.

Third, we reiterate our guidance for provision for credit losses for 2026. Asset quality remains strong and portfolios are performing in line with expectations. We remain vigilant given the evolving macroeconomic environment and took a management overlay, which may not be eventually needed when the Middle East situation normalizes. Fourth, we are comfortable with the trajectory in profitability and continue to expect strong operating performance in 2026.

And finally, we want to deliver attractive capital returns going forward, which is why we increased our payout ratio to 60% and started to make deductions in CET1 capital to this ratio already in the first quarter. As we move through the year, we are intensifying our focus on a scalable operating model, carefully phasing investments with clear emphasis on accelerating structural efficiencies and disciplined cost control. This further strengthens our intent to deliver productivity and efficiency beyond the commitments we made for 2028.

As I finished my first quarter as CFO with a better view of the capabilities and opportunities since the Investor Day and taken together with our first quarter performance, I remain confident that with the strength of our franchise, the discipline of our execution and the resilience of our business model, we are in a good place. From my perspective, we're just getting started. We have everything we need to deliver, and I'm exceptionally pleased that the business mix shift we had envisioned and planned for is already becoming visible. And with that, we look forward to your questions.

Thank you, Raja. Operator, we're now ready to take questions.

[Operator Instructions] And the first question comes from Tarik El Mejjad from Bank of America.

I have two, please. The first one is regarding your revenue guidance and the mix in '26 and during the plan. Maybe you can actually go a bit on more detailed outlook on the -- each of the divisions where you see the outlook for this year and next and especially on the light of the recent developments and conflicts in the Middle East impacting the German economy as a whole. And maybe you can also touch on the FX dynamics in first half versus second half. Then the second question would be on RWA growth dynamics this quarter. If you can discuss again what would be the key areas that you think could reverse and the trajectory on the -- in the second half? And also the implications on distribution outlook, including when is the next share buyback should be expected?

Tarik, thank you for your question. Let me start, and I'm sure Raja will add. Look, on the overall guidance for 2026, we remain absolutely confident that we can achieve the number which we have given to the market and indicated already end of January. The first quarter is only supporting that. We believe that the EUR 33 billion of revenues is absolutely achievable. And with that, what we have achieved in Q1, that makes me even more confident.

The nice thing about Q1 is actually the shift of -- or the composition of revenues, which we have seen and also in those divisional revenue split that the momentum is actually not one only which I saw in Q1, but which actually is continuing in April. And -- let me start with the asset gathering business in the Private Bank and Asset Management. I'm actually really happy with that performance because it had a reason why we put that, so to say, as the first divisions to be presented at the IDD in November, and we can actually see the takeoff of that business. In particular, assets under management are growing. You have seen the net inflows in the Private Bank, in the asset management. And that goes hand-in-hand with the investments which we have done.

And therefore, this is not only a Q1 development, that is a development which we continuously see now in April, but which I expect to happen throughout the year. And it goes in line with that where we see the megatrends for the industry. And you have heard all about the discussions on the German pension reform. You have heard me talking about, so to say, actually, the survey, which we have done in November when -- in Germany, when the Germans think about their state pension money, which is expected to come and that they actually now see the need that they need to do more. That is actually what we see day by day in the business in terms of inflows in the Personal Bank, but also obviously in Wealth Management.

In Wealth Management, it's a reflection of the investments which we have done. We told you in November that we are investing into approximately 250 additional wealth managers. We have hired 100. I think more than 80 are, so to say, on the ground. And to be honest, the start could have not been better. And therefore, I expect that trend to continue. And therefore, I do believe that when it comes to divisional revenue outlook, Private Bank will be clearly up year-over-year '26 over '25.

Similar for Asset Management, nice development in Q1. But also there, again, based on the trend of our focus on the capital-light business and the asset gathering business, with all that, what Stefan is doing also in terms of new partnerships, I think we outlined that in our prepared remarks, I can see the momentum continuing.

Investment Bank, to be honest, I think a very solid development in Q1. I know that we always compare to the U.S. banks and rightly so, that's fair. But, a, we had obviously, the foreign exchange headwind in this regard. And secondly, also the U.S. banks, in particular, grew in 2 areas where we are actually not playing, i.e., equities and commodities. And if I then do the real comparison, I'm very, very proud of what Ram and the team have done in the trading business. And in IBCM, we see a year-over-year increase in Q1.

And to be honest, if I now see the pipeline for Q2 and Q3 filling, I'm actually quite positive about the momentum in the IBCM business. And that leads me to the belief that despite a very strong 2025 year in the Investment Bank, I think we see a year-over-year growth also in the Investment Bank. Corporate Bank, as we said, the real increase in revenues. So year-over-year, we expect an increase, slight increase year-over-year, and the real increase will be in the second half of the year that we highlighted to the market early.

And that's exactly the development which we have seen. The nice thing about the Corporate Bank is that the lending book is increasing and obviously, based on one of our 3 levers, SVA methodology, i.e., we are deploying the money there where it's value accretive. We are actually reducing the businesses in those areas in the Corporate Bank where we are not earning our SVA, where it's SVA negative, we could see actually a nice shift already in Q1. And therefore, I'm very positive actually in terms of the development of the Corporate Bank, but also the way we are applying SVA.

That all brings me to the clear conviction that the EUR 33 billion is out of question. We will achieve that. And one last thing to the guidance, that does not include what a lot of analysts actually expect that there may be a rate hike. To be honest, that's not something which we can take in our base case. But if this is coming, obviously, it's additional income, but that is upside. But the real drivers and also what I can see in April make me very confident.

I hope I also gave you already a little bit of guidance when it comes to the RWA increase in Q1. Please also don't forget that we had a very unusual low ending in Q4 of 2025. So we also need to see actually the increase when we compare it to the end of the quarter 2025. And again, the increase in the lending business is clearly based on SVA positive business, and that will pay out long term, obviously.

Last but not least, on the capital, and I'm sure Raja will add to this. Look, please also look back what we have done in the past. We are now finalizing our first share buyback. I think we are approximately at 60% completion. We have always shown in the past that we are looking at our performance in Q1 and in the first half year. That's exactly what we are doing right now. We are accruing to 60%. I'm not accruing to 60% because I don't want to pay that out. So there is a clear intention. Look at our performance right now as of today. I think we have all the best attention to go back to the market.

Thanks, Christian. Tarik, I just will add a couple of things on RWA. Christian already mentioned, first of all, I would comment from a CET1 ratio perspective, a drop of the CET1 was always planned and expected. We're obviously putting the FX effects on the side on the capital. Every year's first quarter, we have some impact on equity compensation. In terms of RWA development, the market risk and the CVA RWA obviously rebounded as expected from the very low levels at year-end as we kind of clearly move towards our operating level.

This was also partially driven by higher client activity and market volatility, which we saw in March. So depending on how this plays out, clearly has a bearing on forward-looking market risk. On the credit risk side, Christian talked about, we saw great opportunities to deploy this on lending, both Corporate Bank and IB. And we took -- we saw that opportunity, and we thought it was SVA accretive, and we decided that we wanted to do that.

Going forward, there are a few things that you should expect. One is we are accelerating our work around the portfolios, both in the Private Bank on mortgages, which are sub-hurdle and we are exiting them at quite a fast pace. And depending on how that goes, that gives us a lever. In trade finance and lending, we also have an SVA negative book, which we are also executing on. Then don't forget, we also have some plans regarding SRTs later on in the year that creates the capacity to increase or further increase our lending activity without really sacrificing our CET1 level.

So all in all, from my perspective, everything in line with what we planned. And frankly speaking, honestly, pleased that the corporate lending growth -- corporate bank lending growth that we were actually looking and aspiring for is beginning to happen. On the fixed side, we are actually able to lend and didn't even see the margin compression that we were assuming would happen at least as of now. So all in all, very productive deployment of capital.

Obviously, in the fixed side masked a lot by the FX. But clearly, on the corporate bank, as Christian said, as I look at my third and fourth quarter, I will not only have sequential growth on the back of lending and deposits, but I will also have year-on-year growth. So at least that will put to rest that discussion. And for the most part, the FX headwinds will essentially dissipate in the second half at the same time, I think which was the other question.

And the next question comes from Anke Reingen from RBC.

Just on costs. I think you alluded already in your remarks, but can you talk a bit about the cost trajectory in the course of the year as you talked about a step-up in Q2 versus Q1. Could that mean you overshoot your pro rata guidance for this year? And how do you balance with investments given the uncertain environment?

And just to confirm, at the end of the day, I guess the target is still for the cost/income ratio to come in lower than in 2025 at around -- below 65%. And then just following up on capital. I guess you alluded in your annual report about RWA growth of -- which would imply like 6% to 10% for the year, running a bit higher in Q1. What should we sort of like think about? I mean I know there's lots of moving parts, including market risk, but where should we think about RWA growth for the year? And that leads to the question about the share buyback you said in due course -- is due course already Q2 results? And would you be happy to land -- would you be happy to announce a buyback if you are sort of like at the lower end of your 13.5% to 14% guidance? I know you already accrue for the 60%, but how does it all square with the RWA growth you're seeing?

Sure. Let me just start in order. Look, on the cost guidance, I want to just reiterate that we remain fully sure about the guidance that we had -- ambitions that we had set out. We will not overshoot our target. In fact, based on what I'm seeing in the first quarter, we may undershoot our targets, which might actually be a good problem to have.

What we're seeing is that we are able to accomplish a lot of the investments and the development work at actually a lower cost than what we had actually envisioned when we actually set the investment plan together. So from that perspective, we remain fully confident that not only will we meet or beat our expense target for the year, but also we will also deliver the cost/income ratio improvement that we had promised.

So in that sense, nothing has changed. We are deploying the resources. What we are doing is to make sure that our prioritization is right. What I mean by that is that I would like to prioritize those things that actually bring us in-year benefits on the productivity side, but at the same time, retain the benefits of the longer-term delivery. But you also saw that the 80 bankers that we hired in Wealth Management that have not even produced at this point, the net new asset outcome, that is still to come. And so the results of the previous hiring is beginning to play out. So I don't want to sacrifice my future growth.

But that said, it's pretty clear that where we -- what we thought would cost us to get some of the things done is actually coming out better. Now obviously, this is only the first quarter, but I'm pretty bullish in terms of our ability to be a little bit more disciplined, perhaps we were a little bit more conservative around our investment costing than where the real life is. So that's that.

In terms of the RWA growth, I think Christian talked about it, we firmly will remain within our target operating range, which we've laid out. In fact, I would like to be not towards the low end. I would like to be squarely in the middle. And the reality is that the 60% that we are accruing isn't with an eye towards doing a second half buyback, assuming all the normal cadence is met. We would like to see the results of the first and the second quarter. Then obviously, we, as a bank, go through a process of our approval. And then at that point, we communicate. That's been the cadence that this bank has set up, and we intend to stick to that one.

You say on costs, you're not overshooting the target. Are we talking absolute costs? Or are we talking cost/income ratio?

So I think we have given a cost guidance for this year of being slightly above EUR 21.3 -- a little bit over EUR 21 billion. I would believe that we have very strong conviction that not only are we not going to overshoot that, that I may actually undershoot it especially even in a normalized environment and therefore, also reiterating our cost/income ratio improvement year-over-year.

And the next question comes from Joseph Dickerson from Jefferies.

I just had a question on the -- following the CRE measure and the overlay. You've reiterated your CLP guidance for this year. I guess how -- could you give some color on the overlay that you've taken and then the trajectory on CRE? Because, I guess, what you've taken suggests somewhat of a more benign situation for the next 3 quarters.

Absolutely. Thanks, Joseph. I think, look, on the overlay, it was a judgment call from a management perspective, looking at the macro environment around the Middle East conflict and the uncertainty around the eventual resolution, we felt it was prudent to at least look at -- embed some forward-looking indicators that potentially may not be getting captured in the indicators at the end of the quarter. So it was really around our view that perhaps it's better to be prudent than to be late.

And if we don't need it, and the same thing happened last year, we had an overlay for tariffs, which ended up being not needed. And so in this case, from my perspective, in the base case scenario, this is potentially a reversal at some point if things get better from here. So it was really that discussion in our heads to say whether we wanted to be a little bit prudent here or conservative here or not.

In terms of commercial real estate, the great part here is, and I think on Page 27 of our deck, you can see the evolution of our high-risk stress portfolio. What we are seeing in commercial real estate, and that's why I have conviction around the long-term trajectory of our CLP is that the increases or decreases that we are seeing in this is on existing default position -- defaulted positions. The new inventory or the new default pipeline has pretty much stopped at this point.

So that gives me the confidence that we always assume there will be some level of CRE-related impact in 2026. It just happens to be that it came in first quarter of 2026. But when I look at what our remaining subset of open exposures are for CRE, it gives me the confidence along with what I see is the absolute shrinkage of the underlying stress portfolio.

So between the 2, the actual indicators of our CLP this quarter were actually positive in all businesses, Investment Bank, Corporate Bank and Private Bank. So in the Stage 1 and Stage 2, we actually saw a really good outcome. It's just that we made a decision as a bank that we would like to be a little bit conservative on the forward-looking Middle East-related situation, and we took a correction or a top-up of a provision on an existing defaulted loan.

Let me just add because obviously, I have a little bit of history in risk management. Look, everything Raja said, I subscribe and I simply feel that, obviously, given the uncertainty from the Middle East, it is the right thing to do, but we don't expect to use it. Moreover, what is for me most important is next to all the portfolio reviews we have done over the last 3 months, we don't see any negative trends from a rating migration in any of those portfolios, and that is important. And I think we are very close to that.

And that gives me actually the confidence about the resiliency of the portfolio. We have been here conservative. And therefore, I really do believe that this is a very good signal. Secondly, also, let me be clear, and I hope I was clear at the Morgan Stanley conference, we, again, have no negative experience on the private credit portfolio in Q1. And the overlay has nothing to do with that. Actually, for us, this is not a story. Raja made it very clear this morning. I made it clear in March. We see absolutely behaving portfolios are happy with the diversification. And therefore, this has been taken for real conservative measures. On the rating migration, the underlying performance of the portfolio, we don't see any negative deterioration.

Then the next question comes from Nicolas Payen from Kepler Cheuvreux.

I have 2, please. The first one would be on your use of AI. I think you mentioned the use of AI to reengineer core processes and you use the example of corporate credit risk. Do you have any other example to illustrate how you're actually deploying AI within the bank? And maybe what kind of revenue opportunities or operating efficiency you can associate with these deployments? And maybe are you seeing a net benefit from AI implementation once you account for cost of AI? And the second question would be on the Private Bank. You disclosed EUR 30 billion of additional client assets. And maybe can you -- could you discuss a bit how this will help PBs going forward? How does it fit into the business? And what kind of pace you're expecting on the client assets going forward?

Let me start and Raja will add. Look, as I said in the answer to the first question, the Private Bank story makes me really happy because since over 6 months, actually, Claudio has a very, very clear strategy that investment products is, so to say, the main target for the Private Bank. And what we can see is actually that the whole steering of our franchise, but in particular, the steering of our Private Bank divisions is taking the momentum. And therefore, -- the net asset under management flows in the first quarter was mostly in investment products, approximately EUR 10.5 billion, predominantly in discretionary portfolio management, and that's in particular in the private, upper private banking and Wealth Management and actually shows that, so to say, the steering of Claudio is taking more and more momentum and speed.

And now with the investments we are doing, in particular, in the Wealth Management, Raja just referred to that, and with people actually getting their feet under the table and doing and actively pursuing the client activities, this will further grow. Secondly, and there is the bridge already to AI and to technology, don't underestimate actually the future potential and also the potential and actually the capacity, which we already saw in Q1 in the Personal Bank. Of course, you talk about lower individual amounts. But actually, the need for our clients in the personal bank to think about their own private pension investment is higher than ever before.

The urgency, the attention of these clients actually asking for that, looking for advice is as high as I have never seen it before since I've been with Deutsche Bank. And this is exactly what we are now looking for, and this is where we are, for instance, applying technology because obviously, for 19 million personal banking clients, you can't do a one-to-one advisory in a physical way. It's impossible. So therefore, actually, Claudio is very much investing into the technology to get the tailored advice to these clients, and we can see that this business is taking off.

A good part of the growth in the personal banking is on the back of the investment business, obviously, also in taking in deposits. But that's actually the strategy, and that is completely supported by AI. And therefore, AI, as I think explained it in the previous calls, is not only obviously something where we will improve on efficiencies, but it's in particular, actually that we will improve the client experience. And that is also what Claudio discussed on the 17th of November. And with the investments we are doing, it's far easier, obviously, to capture the potential on the revenue side in the broad-based retail business. And hence, I expect actually that the momentum we have seen in Q1 will actually continue in the following quarters. But Raja, you want to add?

Sure, sure. Thanks, Christian. So let me just take this point about the EUR 30 billion client assets, which was obviously a new target that we had set at Investor Day from taking them from EUR 800 billion to EUR 1 trillion. Look, this is something that I am super, super passionate about personally. I think the strategy is pretty clear for us, we want to add client relationships, whether they come from custody, whether they come from DPM or they come from advice. We want to grow our net new assets, which we've shown, and then we want to migrate to fee-based, which is really the holy grail. And the channels are different.

We obviously are new recruiting. We talked about it. The existing advisers are becoming more productive. And the third thing, which we actually have not even harnessed yet, to be totally honest with you, is the cross-firm references and the cross-firm collaboration. I would just want to give you one example of the success of this, that in this particular quarter, we brought EUR 10 billion of investment products in the wealth management space -- in the private bank space. In 2025, we brought a little bit over EUR 10 billion in the entire year. So what we did in 1 quarter, and I know it's only 1 quarter, was almost the same as we were able to do in the entire 2025.

So when I look at that momentum and even if I was to sustain 50% of that momentum, it makes me really, really happy that the mix shift and the velocity of attracting new net new assets is actually really high, and that actually goes to the conviction that Christian had about his EUR 33 billion for 2026. But for me, the real benefit is, if we can show 5%, 6%, 7% net new asset growth, where does this -- where -- what is the upside to the $1 trillion -- EUR 1 trillion client asset target that we had set up for the Investor Day.

And the next question comes Giulia Aurora Miotto from Morgan Stanley.

I have two. I just want to go back quickly on the overlay, the EUR 90 million. Was this taken by changing the macro assumptions or with some specific portfolios in mind? And do you have some sensitivities on the oil price specifically? Because I appreciate that if the situation gets resolved quickly, this will be reversed. But if the situation continues, you might have take more. So it would be good to have a sense there.

And then a separate question, different on financing revenues. So I would have thought this could be perhaps a bit weaker given what's happening with, for example, private credit. Just thinking that if the clients that you support on the financing side are a bit more challenged, maybe that part of the revenue is more challenged. But it doesn't look like it. So -- and in fact, you called it out saying that there was good growth and there is momentum in the business. So can you give us an outlook on how you see financing evolving from here also in light of, I would guess, more competition from U.S. banks?

Thanks, Giulia. Raja, I'll take the questions. Look, on the overlay, it's all macroeconomic. But I would describe it in maybe 2 parts. Maybe 2/3 of it is essentially changing the -- our inputs or the macroeconomic indicators to see what they would look like if we had to do kind of like catch up to what the environment looks like. And then 1/3 of it is to say, okay, if there was a little bit of an energy shock, what type of clients could potentially be impacted by that. So in the sense, if the environment improves, both those pieces essentially get taken off the table, not just one of them. So it's not like one will stick and the other one will not.

In terms of the sensitivity, we looked at a couple of different scenarios. This is certainly not the most optimistic scenario when we come to the EUR 90 million. It was somewhat of a little bit of a protracted energy shock, which makes me comfortable that unless the environment is completely off kilter, that we have what we need. And in fact, we may have more than what we need. But I really felt it was important for us to be a little bit forward-looking and proactive and not just looking at backward-looking indicators when we're doing our allowance. So that's a little bit on the overlay. In terms of your financing review question, look...

Sorry, can I just follow up on...

Sure.

What the oil price do you assume?

I'm sorry, Giulia, can you...

The oil price. I think to be honest, Giulia, I think our overall assumption for the full year is now that we have an average price for the full year of approximately $95, and I think it was in '25, I think the average price was $65. So we have almost priced in a 50% increase for the full year. That's the general base case expectation for the bank.

Thanks.

Giulia, on the financing revenue side, I think the growth is coming from our ability to deploy across the franchise, the complex, not just private credit. As you know, private credit only represents 5% of our overall loan portfolio and a fraction -- and a small portion of our FIC complex.

I think part of the overperformance also comes from -- if you remember at Investor Day, we assumed that there was going to be continued spread compression in FIC financing. Thankfully, and at least as of this quarter, we did not see the same dynamic play out. So not only did we have healthy growth from a volume perspective, we were able to hold our own in terms of the spreads, and that led to our outperform as I mentioned in my prepared remarks, our private credit portfolio has pretty much stayed the same in terms of magnitude. So the growth that you're seeing in FIC financing is not necessarily driven by private credit.

That said, the kind of sponsors and the counterparties and the funds that we deal with are high-quality people which have very little concerns raised about them. So they continue to operate their business. And we are actually, in this environment, able to be even more selective of who we choose to do business with, what kind of structural protections we can enhance and frankly speaking, what pricing we want. So in that, all in all, I think the FIC financing story is a good one because no compromise on underwriting standards, no spread compression and being able to choose where we play.

And the next question comes from Kian Abouhossein from JPMorgan.

The first one is just wanted to see your view on the balance sheet growth we see in the U.S., your competitors in the U.S. in the IB side, in the financing side, in the corporate side, you're the Hausbank for Germany, how you see that impacting you? Considering when I look at your balance sheet, it's pretty well maintained. You have clearly not as much growth, and I assume not as much growth as what we are expecting from some of the U.S. players. But I just want to see the competitive dynamic, how you see that playing out over the next 12, 18 months?

And then secondly, I wanted to just hear a bit more around private credit, you have the EUR 25.9 billion, which you gave at the year-end. We had some disclosure from the U.S. peers, which look a bit higher relative to some of your peers, I would say, but there might be definitional issues. So maybe you can highlight what maybe the definitional differences are against U.S. peers. And I was wondering also, as we get disclosures from some peers on BDCs, if you could tell me how much that is? And lastly, how much is actually the undrawn commitments because I think the EUR 25.9 billion is drawn.

Thank you, Kian. Let me start on the broader competitiveness question. Look, I think, Kian, if you look back for the last 7 years, our strategy was actually to play there where we can add value and where we have our place. And I really do believe also, again, looking at Q1, but also looking actually at the pipeline and the mandates we are talking about, the financing requests we get and we are working on that this was the right decision.

And therefore, I'm not that worried about the competitiveness going forward. Obviously, I can see that there may be an advantage on the U.S. side from a capital point of view, from a balance sheet expansion. But to be honest, if you look at our market standing and the way we are doing our business, it has a tremendous advantage that we are one of the very few European banks which can play globally.

And in this geopolitical situation where we are, the call for a European bank when it comes to strategic advice, when it comes to global risk management, when it comes to network banking in the Corporate Bank, our clients around the world would like to have a European bank at the table. And this is exactly where we see our opportunity. And therefore, that despite the competition of the American banks and clearly great banks, we can see that this is our spot and that we can actually deliver there.

Now what is most important for us is that we are not compromising. And therefore, I just want to reiterate what Raja just said. We were very open with you on November 17 that we said one of the reasons why we only see limited growth, so to say, on the fixed side is that we don't want to compromise on margins, and we won't do it. And if we start seeing that, I don't think that we will play the game because we have a clear SVA-driven methodology. We haven't seen that in Q1, and therefore, we could obviously also expand in that business.

But I think the market position of Deutsche Bank with our capabilities and being a European player in an environment where people would like to have a European alternative at the table when it comes to risk management advisory is a fantastic opportunity. And that is for me the reason why we can grow. And if we stay focused and not do everything what others are doing, and we keep investing into those businesses where we have a market-leading business, then I'm not worried about -- at all about the competition. Last but not least, but I think Raja can explain that better. I'm glad you asked about the definition of private credit because obviously, we did some work on this one, and it shows you that I think we have a little bit of a broader definition, but Raja will talk about that.

Sure, Kian, as you know, we were the first ones to kind of put out pretty detailed disclosure on private credit, both in terms of magnitude, the structural protections, how we do business, why we feel comfortable. And I'm actually super happy that to be the trends that are here because now we are seeing almost all of our U.S. peers follow our practice this quarter. And it's become pretty abundantly clear to me that in the absence of a universal definition, our definition was slightly broader than at least most of our peers.

What I mean by that is most people seem to have focused on lender finance portfolio, not other things around it. And if you were to take that definition for us, it will be around 75% of our disclosed number. Now look, we -- I think at the end of the day, we have to risk manage things regardless of what you call them. So calling it one thing versus the other doesn't -- from my perspective, doesn't change the focus and the attention we have. But there's clearly definitional differences between banks. And presumably at some point, there will be some alignment.

In terms of your question on BDCs, we focus on large BDCs and therefore, pretty comfortable. We usually senior in their cap structure. At the end of the day, our exposure on BDCs is like approximately EUR 0.5 billion. So it's a very, very small exposure in that sense. And the unfunded exposure again on the BDCs is around EUR 2.5 billion as well. But as I mentioned, it's essentially senior in the structure, and we don't really deal with small BDCs. We are with the large cap ones. So hopefully, that's helpful.

Then the next question comes from Chris Hallam from Goldman Sachs.

Just 2 from me. So first, on the EUR 100 million of investment spend in the first quarter, could you give an indication on how you'd expect the outstanding EUR 800 million to phase through the rest of this year? So if we assume EUR 200 million to EUR 300 million per quarter going forward, can we also carry that run rate into next year, into 2027 and then the EUR 1.5 billion is largely done by the end of the first half?

And perhaps you could just remind me on whether all of the EUR 900 million this year and indeed all of the EUR 1.5 billion is cash spend or is some of that capitalized? I think you might have confirmed that at the IDD, but I just couldn't find it. And then another follow-up on costs. Raja, you said that you thought you could undershoot on costs and also on the cost/income ratio. Is it fair to say that because you're saying that on both absolute cost and on cost income, that isn't a comment around FX tailwinds on costs, i.e., you're talking about organic cost improvement?

Yes. Look, we've been pretty transparent that FX was clearly a tailwind for us on expenses, but actually a much bigger headwind on revenue. So all in all, FX actually played against us from an EBIT perspective. So not counting on FX to basically be the main driver of the undershoot. I think the main driver of the undershoot is just my conviction around the fact that we -- some of the things that we thought we would do, actually, the pacing may be a little bit different, but also it actually is costing us less to some of the development work that we were doing.

And partly, that is probably driven by AI and partly our ability to actually do a much better job of figuring out what we have in the bank that we can actually leverage rather than starting it from scratch. So that's where my conviction comes from on the cost side. And obviously, that helps with. In terms of your other question, clearly, what is in our plan is to actually have a slow ramp-up because we want to be disciplined as for the reason that I mentioned to you.

We do see some opportunities in the second quarter to accelerate some of the productivity-related benefits that especially comes from the Private Bank that we want to have an in-year benefit. That means that we will potentially need to take some restructuring and severance charges in the second quarter, along with the other development -- tech development work. So that will basically mean that we will have a second quarter run rate that is in excess of the first quarter.

And my intention is to actually manage it pretty tightly and prudently and so that we don't see spikes up or down through the rest of the year. But as Christian said, we have to look at the environment, but I also have to look at where I have the highest conviction of the spend, and that will allow me to pace it. Remember, our cost -- our investment plan was a 3-year investment plan, which is gradually going down over the years. And the EUR 900 million number that you talk about, it is actually a P&L number because obviously, we also have the tech development as part of that.

So all in all, I think the fact that we have been able to start at a measured pace and still be able to do what we wanted to do. We already hired 80 bankers in Wealth Management, and they're already productive. And the fact that I think it's coming out that we can actually do some of the things much more economically than what we had assumed when we put the plan together, it gives me a little bit more surety around being able to manage the 21-plus number for the year, no matter where FX is.

And the next question comes from Stefan Steinmann from Autonomous.

I have 2 questions on numbers, please. The first one on your provisions for credit losses, the EUR 519 million in the first quarter. Can you tell us how much of that was actually Stage 3 related? And I also wanted to talk about the revenue in the Private Bank that is not NII. You mentioned in the other income part, some valuation effects on guaranteed products. Could you add a little bit more color on what that relates to or the size of that commitment is and that would be very helpful. And also in the Private Bank on the same vein, I noticed that your AUM are growing very nicely, plus 10% year-on-year, but your net commission income is only plus 2%. Is there anything in the mix or anything else that holds back the growth of net commission income, please?

Just to give you some clarity, as Christian mentioned, the underlying portfolio migrations in Stage 1 and 2 are developing super nicely for us, which is really, really promising. Almost all of the provision this quarter in the EUR 500 million is related to Stage 3, which is what I mentioned. In essence, what we're seeing is a true-up of reserves on existing defaulted positions rather than new things migrating towards that. So -- and obviously, we have the overlay of the EUR 90 million or so that we have parked in Stage 1 and 2 because that's not name specific. So for the most part, the provision number is driven by Stage 3.

And in terms of Private Bank AUM, there's always going to be a lag in terms of when you bring the clients, when you onboard them and when you start generating -- move them into discretionary portfolios or fee-based businesses. So I would think that that's the hypothesis that I was talking about that if we can increased our capacity of taking more and more assets, eventually, they move to advice and the advice moves to fee-based, and that's what gives me a lot of confidence. In terms of the -- I think the valuation piece that you mentioned, that wasn't really a big driver. I believe it was in asset management and not wealth management.

And the next question comes from Flora Bocahut from Barclays.

I'd like to come back actually on 2 elements that have been discussed before, the RWA and then the investments that you are doing this year. On the RWA, maybe let me ask you the question a bit differently. At the Capital Market Day in November, I think you guided for RWAs in '28 to be EUR 385 billion. That was post FRTB, which looks like it will be delayed by another 3 years. So let's call it EUR 378 billion ex FRTB. In other words, for you to meet that target, you need RWA growth over the next 3 years pretty much to be the same as what you just did in one single quarter here in Q1. So can you help us understand why you think this will be achievable?

And then on the investments, can you talk again on what exactly you are planning to do with the EUR 900 million investments? I understand you've hired bankers in wealth. I understand the points you just made that maybe you can do those investments in a more economic way. But can you remind us exactly what you have in mind there and how you think this is going to help your revenue base?

Thank you. All fair questions. On the RWA, I would mention that I think it's hard to extrapolate 1 quarter to obviously 12 because obviously, we have dynamics between market risk, credit risk, we talk about the growth and also something on op risk, which obviously is not something that happens every quarter. It's done as part of a refinement of the methodology. I have to give you 2 main things that we also discussed at the Investor Day. One was our increase of our SRTs from -- by approximately 20%, which we have just begun to execute, and it's mostly that program is going to be executed over '26 and '27, number one.

Number two, if you remember, we were only 40% in SVA accretive businesses at the end of 2025. And our goal is to get to 70%. Now all of that -- a lot of that is going to come from us doing better on pricing, being more efficient, more productive but we also have portfolios that are consuming RWAs without bringing us the returns that we want. And the 2 best examples of that is the mortgage business inside Private Bank, where we're continuing to derisk and reallocate resources.

And the second one being trade finance and lending, where we also are beginning to exit. And obviously, not all those actions are either visible or done at the end of this quarter. So I would say it's a function of us being prudently managing out unproductive RWA and redeploying it to productive RWA. It's the use of good tools like SRTs. And then it's honestly, the third thing which makes me really comfortable is our focus on asset-light businesses. If we do this thing right, we don't need the RWA growth to deliver the EUR 37 billion or EUR 38 billion that we promised on Investor Day.

Our Private Bank and our Asset Management businesses, which consume very little RWA should essentially fill the hole for the lack of using consumption of RWA. But we're just starting our journey on this mix shift. It's already visible. So I feel confident that on the RWA side, if we are able to do what we want to do on our Wealth Management and Asset Management, it's not going to be an issue.

And a bit more transparency on the EUR 900 million in investments. Look, we talked about the hiring in Wealth Management. There will be some selective hiring in IBCM because we want to close the gaps we have in order to provide the coverage which we need. And to be honest, also there, we are making good progress. I talked about that. The real investments will be obviously focusing on technology in the Private Bank, but also in some of our back offices.

Private Bank, I just said in one of my answers when we are coming to the investment process that we need a front-to-back process. This is exactly what we are applying and what we are building for our personal bank. That will obviously cost certain investments, but we think that this will further not only increase the efficiency of the bank, but the client experience will go up.

Secondly, we have been always very open about that what we have done over the last 5 years in terms of regulatory remediation, in particular, in areas of AFC, compliance, know your client. We are now at the place where I think we have done good progress on regulatory remediation. Now we are actually thinking about how can we further automate these processes. And that is, in particular, affecting AFC compliance, where we are putting a lot of technology at work. These are the main areas actually and obviously bring run the bank down in TDI, where we are putting technology to work, where we are putting the investments with all the efficiency gains, which we then see over the next 3 years.

Thanks Christian. One thought I want to kind of -- it was in my prepared remarks, but it's very clear that the investments that we are making in AI or we're beginning to make in AI that have an impact on our cost structure above and beyond what we had envisioned at the Investor Day. If you remember the Investor Day, Christian had laid out some levers to our upside of the 13%. It's become abundantly clear that once we deploy AI pervasively across the bank that we can potentially do much better than what we had assumed for our 2028 plan, especially on the cost side.

So that investment is also part of our EUR 900 million, but the benefits of that are actually much more exponential than both Christian and I had assumed at -- in November. And that is giving me a lot of confidence that no matter the economic environment in 2028, the upside for our structural cost efficiencies actually is greater than what we had planned for or had assumed.

And the next question comes from Máté Nemes from UBS.

I have 2 of them, please. The first one would be the reduction of sub-hurdle -- SVA sub-hurdle loans. I think both of you mentioned that this process is accelerating in the personal bank, and then you also clearly see opportunities in trade finance and corporate bank. Could you give us just a sense of where exactly are you in that process? I understand that's still relatively early part, but any numbers, any color you can give on that would be helpful. Also just to put lending growth into context, can you give us a sense how new lending on an underlying basis would look different if you excluded the sub-hurdle loan reduction? So that's the first question.

The second question would be one on corporate and other. I think you were guiding to roughly EUR 200 million negative in pretax contribution per quarter at the beginning of the year. Q1 clearly better. I think the guidance for the remaining quarters remains unchanged. To what extent do you see a possibility of continued outperformance on that side? And what could drive that?

Sure. Let me take the first question first on the SVA actions. Just to give you some perspective that we assume that our wealth -- our mortgage lending would potentially be down by almost EUR 14 billion over the next 3 years. That's the size and scale of the actions that have to be taken. Obviously, it's going to be over a period of next 3 years, but that just gives you a sense of the potential capital relief we get.

But at the same time, we believe that our wealth management low capital-intensive Lombard lending will be going up by almost 2x that. So basically, we'll be able to reoptimize our balance sheet at a much higher return with much less RWA consumption. So that process is ongoing. And for Private Bank, we actually had growth in net new lending, which is being masked by the EUR 4 billion or so of reduction that we just did in this particular quarter. So just to give you a sense of the pace of that. And I think we can do a much better job and much faster job there, but that obviously is a plan that we're looking at over the '28.

Same thing on the trade finance and lending, we have been able to take the low-margin dock trade business and substitute with the actual trade finance high-yield business that is much more accretive to us. So again, we are 1 quarter into our journey. But just to give you a sense of the magnitude, at least on the mortgage book, it's a pretty sizable reduction.

In terms of C&O, look, it is always the one that is harder to predict. Most of the gain this quarter was from VNT in terms of pulling price -- pulling to par. In some companies or some banks, this activity actually sits with the business and is reflected in the business results. In our case, it actually is in our C&O. At this point, where I sit today, without having a crystal ball, I would think the best estimate is still for us to get to the EUR 200 million for the rest of the year.

And the next question comes from Jeremy Sigee from BNP Paribas.

This is just circling back on a couple of topics. One is the origination and advisory pipeline, which you said is very robust for 2Q and 3Q, which echoes what we've heard from some of the U.S. firms. I wondered if you could give us a more European perspective on that. Do you see the same resilience of dealmaking in Europe, obviously being geographically and kind of economically closer to some of the risk issues in the Middle East conflict.

Do you see the same resilience in Europe that U.S. firms have already commented on in the U.S. context on the primary IB side? And then my second question, another kind of growth area. You're showing a bit of loan growth in Corporate Bank here, and you mentioned trade finance. I just wondered, which segments, which industry sectors that's coming in and how you see that linking to some of the stimulus themes that we've been discussing for a few quarters now?

Thank you. Let me start. Look, on the origination and advisory pipeline, I think it's also a little bit of a specific Deutsche Bank story because you know that Fabrizio and Ellison actually changed the focus of the IBCM business over the last 12 months. We were -- we are now focusing far more on the corporate advisory business. You know that we are very strong in the financial sponsor business before that strategy has been changed.

Here, we started to really also specifically hire people. We strengthen our M&A sector. We strengthened our ECM sector. And therefore, also what you see now in terms of pipeline is also the result of the continuous work which Ellison and Fabrizio have done over the last 12 months to reposition Deutsche Bank in this. And hence, it's not all about the market development, but it's also the way we have reset up this business, and I'm really glad about this progress I can see there.

Secondly, from a market volume point of view, Look, I think it also explains a little bit the different numbers between European and U.S. houses in Q1, but also in '25, to be honest, we have seen a stronger IBCM business actually in the U.S. Actually, one can see that finally, we see movement also in Europe. And that combined with the investments we have done with the focus, we have given on this business is actually showing now in strong pipelines in mandates. And in particular, in our home market, I'm really happy about that what we can capture and what we have captured. And hence, I'm actually quite positive on the outlook of this business. But I wouldn't say it's more about the right repositioning of Deutsche Bank.

With regard to your second question, and Raja may want to add, Look, there is not the specific sector within the Corporate Bank. I think it's pretty broad-based. But in your side question or in the side remark, you also looked at the stimulus program. It was actually quite encouraging what we have seen in December, January, February, we could see that the demand for financing also in Germany is taking up speed, in particular, in areas which are close to the infrastructure spending, in particular, in areas you see to the defense.

I think in our prepared remarks, we also made reference to one defense financing, actually, which we have participated in and which we are doing. It's just one example out of a lot. And if it starts actually -- the way Germany works, if it starts with the larger projects, you then see the headline, so to say, on the Dutch companies. But in particular, in defense, there are so many subsuppliers in the family-owned and mid-cap areas. And there, we can see that business is starting to really increase. And therefore, obviously, the stimulus has its impact.

The conflict in the Iran obviously is not yet helpful. And therefore, I think it's right that for conservative reasons, we have taken down overall our economic growth assumption for Germany in 2026, but it will not impact actually our overall 3-year plan because I do believe that this growth is coming back. And I'm actually quite encouraged of what I've seen in December, January and February, and that's seen in the portfolio.

Thanks, Christian. I just wanted to highlight on Corporate Bank. Obviously, we're very happy with the progress of this segment. The reported loan growth actually of 6% year-over-year is actually close to 8% if you were to FX adjusted, not that withstanding, we also optimized EUR 3 billion of the loan portfolio in lending. So the actual underlying loan growth in this business has been EUR 12 billion. So if you think the dynamic of that and what's encouraging is that this is just not pure lending that brings NII, it actually is the business that also attracts a large amount of net fee and commission income.

And you will see -- you will have seen we also grew net fee and commission income 5% again, ex FX year-over-year. So that is the level of activity that we're seeing. Going to the first question that we were asked on why we are so confident in Corporate Bank showing sequential and year-over-year growth starting the second half, it is these kind of volumes that we are seeing that kind of come through. while we are actually reducing the non-value-add portfolio.

And the next question comes from Matthew Clark from Mediobanca.

Some more questions on risk-weighted assets, please. So the 6% to 10% risk-weighted asset growth for the full year is quite a broad range still. Can you give us any guidance within that, which end you expect to end up at? And if not, could you maybe sort of outline what scenarios might lead you to be at one end rather than the other? And then a second question on the first quarter investment banking loan growth. Was this more drawdown of existing approvals, albeit you said it was profitable value-accretive lending? Or was it driven more by new approvals of new applications?

Sure. Look, I think the 6% to 10% growth rate obviously was done in the context of our starting point, which Christian talked about was quite low to begin with at the end of 2025. Look, a couple of things that could impact this. One is obviously the absolute demand and what we see we can use our balance sheet for that's very accretive and SVA positive. But putting the demand piece aside, the market risk environment obviously will have an impact on are we operating in volatile markets where the CVA is contributing it.

Credit risk is a little bit harder to predict even in the short term because entering into a calmer period of economic development may also have some bearing on how -- what -- how the RWA operates. So at this point, no, I think this is still a pretty good range. I think if we are in an environment where the economic activity is robust and risk is manageable, you could probably see on the higher end of the range. If we don't see demand and we don't see the spreads developing the way we would like to, then it might be on the lower end of the range. So it's kind of hard to pin down just in April, where this will go given the uncertainty of the environment. We have a pretty good handle of our pipeline.

In terms of what's going to consume RWA, clearly, we are seeing -- we are -- have a few dynamics going on. We are redeploying our RWAs in Wealth Management from mortgages to Wealth Management. In Corporate Bank, again, we are deprioritizing certain portfolios. And on the fixed income side, we are clearly seeing great activity both on the existing draws, but also on new growth. So all in all, if the first quarter is to be an indicator, we think that the activity will be robust, and we're going to continue to bring in more clients and continue to optimize the balance sheet by taking out things that quicker, hopefully, to make room for that.

Can I just follow up quickly? The subtext of that is that for you, the best outcome is that it is at the higher end of that range commensurate with higher demand and stronger economic activity. So you're almost hoping that it's at the top end of that.

No, we would -- we obviously always want to operate in the operating range that we've laid out, which is 13%, and we want to operate comfortably within that operating range, even though there's 2 segments for that. But I do think for me, the most important part is what type of activity are we using the RWA for. If it's accretive, it's SVA accretive, it's -- and it's shifting the franchise mix to the one that we want, I would gladly take it. But if don't, then we don't have a compulsion to because, frankly speaking, if my asset gathering businesses continue to outperform, then there's even less of a need to actually load up things on your balance sheet. So I just think that at this point, in April, we are comfortably within the range that we communicated and the market factors will determine a little bit about where we end up.

[Operator Instructions] and the next question is from Andrew Coombs from Citi.

If I could possibly come back to capital. I guess, 3 parts to the question. The first is Slide 26. If I look at the average 1-day VaR, it's lower Q-on-Q. The 10-day sVaR 10-day SFAR is flat on average Q-on-Q, but there was a spike at quarter end. So just trying to work out how -- to what extent that informed the EUR 2 billion increase in the market risk RWAs and whether you'd expect that to moderate next quarter?

Second question, just on the 60% payout. Have you provided a split of your thought process between dividend and buyback on that 60%, and then I guess my third question would be, you previously alluded to potentially topping up the buybacks if you were to go above a 14% core Tier 1 ratio. But looking at this quarter, I mean, you're running well above your 2% loan CAGR guidance just on this quarter alone. So is it a case that you'd rather deploy it into more loan growth rather than topping up the buybacks?

Thanks, Andrew. I think we always see -- it's not unusual for you to see a quarter end spike in VaR given the way we hedge our exposure. So you could expect that to be back in the range. And we actually already have seen that. If you look at the history, it's not that unusual. In terms of your question on the mix between the 60% mix. I think we had guided at the Investor Day that we will continue to increase our dividend consistently, but probably not at the same magnitude that we had been doing previously, which was around 50%, I think, every year.

So we have not provided that split yet, but you can assume that it's going to be more heavily weighted towards buybacks versus dividend increase. And that's -- and we -- when we communicate the time line at the same time, we will obviously provide more information about the mix as well. In terms of your RWA question, look, I think it's clear for us that we want to do both. We want to walk and chew gum at the same time. We want to do loan growth. We also want to make sure that the shareholders get their capital back at the pace that they expect. In the discussion that we had and depending on how the environment evolves, for this year and next year, that will then determine our ability to be sustainably above 14% and then have the conversation about the excess buybacks.

Then the next question comes from Tom Hallett from KBW.

I've got a couple. I'm just wondering if there's any prospect of your 2% domestic buffer within your SREP guidance reducing anytime soon because there was some news yesterday, and I thought it might have some read across to you guys. And then secondly, on the Corporate and Private Bank, could you give us a sense of the trajectory of the next couple of quarters on NII because it felt like there was quite slow progress there given the hedge benefits that should be coming through.

So let me start with the trajectory on the Corporate Bank and the Private Bank. It is positive as we continue to lay -- replace the existing hedges and we continue to grow our underlying deposit and loan portfolio, the trajectory is positive. And as I mentioned, we still believe that our EUR 14 billion overall NII guidance is fairly within reach. And depending on what happens with the interest rate hikes in the Europe, it also has some positive impact on '26, obviously, a lot more on a long-term basis, but we do have some short-term exposure there as well. So that is all promising. But yes, the expectation is that both Private Bank and Corporate Bank will continue to show improvement on their NII trajectory, and we feel very comfortable about our overall EUR 14 billion.

Okay, and then...

I just want to make...

Sorry.

Sorry, go ahead.

No, I was just saying, so you're expecting a slow tick up in NII over the next couple of quarters. And then I was just going to come back to the domestic buffer on your SREP guidance.

Yes. So let me just -- before I address the SREP guidance, I just want to make sure that the share -- because that question has come up a couple of times. Our second buyback for the year is not dependent on us being above 14% because we have already adjusted for that 60% in our ratios. The 14% comment was solely in relation to excess share buybacks. So I just want to make sure that everybody was understood that, that comment was not in reference to 14%. In terms of SREP, look, I would love to say that this is in the bag. There's certainly upside. There is no downside for us because we actually are above where we should be. And if the regulatory authorities actually go by the math, we could probably see a benefit. But obviously, that has not been communicated to us. The national authorities still have to decide based on the back of the ECB news. But the good part is there's nothing but upside based on the news that we saw yesterday.

So there are no more questions at this time. So I would like to turn the conference back over to Ioana Patriniche for any closing remarks.

Thank you for joining us and for your questions. For any follow-ups, please come through to the Investor Relations team, and we look forward to speaking to you on our second quarter call.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for joining, and thank you for choosing Chorus Call. Goodbye.

Good morning, everyone. Thank you, Christian, for being with us this morning. Christian Sewing, Chief Executive Officer of Deutsche Bank. I have lots of questions to ask you, but let's start with a polling question for the audience first. If it comes up, yes.

So what RoTE do you think Deutsche Bank will be able to achieve by 2028? Below 10%, 10% to 11%, 12% to 13% or above 13%?

12% to 13%. Okay. So some convincing to do on the above 13%.

Well, we are used to beat and raise. And therefore, I think nobody thought that we can achieve the larger 10% last year. Look, what I see from our Investor Day from last year, November, were talking about tailwinds for 2028. So I'm -- for various reasons, even more confident that we can achieve it. But let me beat and raise. So I'm happy that we will beat that one.

Excellent. So I have -- of course, we will discuss Deutsche Bank, but first, I need to ask you about the news of yesterday. UniCredit looking to increase the stake in Commerzbank. How does this impact Deutsche Bank, if at all?

Yes, I think not really. Look, Giulia, we are always thinking, obviously, in scenarios, and I don't want to comment now on particular competitors, and you have all the main acts in the room today and tomorrow. But obviously, we, as a bank, in particular, in our home market, we need to think in scenarios and that was certainly a scenario which we had in our mind. I think we made a very clear statement in the IDD in November that we see real growth potential in Germany. 2 out of the EUR 5 billion of revenue growth is supposed to come out of Germany. I think we are very well placed. We are in many segments, the clear market leader. And that also means that we have the capacity to add new clients. We have prepared for that.

And I do think if something like that is happening, and I don't know that, then you will -- you always need to be in the position to be prepared to, so to say, benefit from and get clients and that's what we are. We changed the way we have set up the corporate bank in Germany. We have a new leadership there. I'm very happy with that. So I think with whatever plays out, we will benefit from it.

If I go to geopolitics now, there is a lot happening. On one hand, we have a war in Iran. On the other side, Europe is trying to do something to improve its competitiveness, and Germany is at the heart of this really. So how does Deutsche Bank stand to benefit or be impacted by these geopolitical developments?

Yes, certainly. I mean, the last 2 weeks added volatility and also, to a certain extent, uncertainty. I mean also when it comes to my home country, energy prices is something which is obviously very critical for the German industry. And it's not only the fact of energy prices. It's just the overall mental uncertainty, which is then placed because of the conflict. Now none of us here in the room have an idea how it plays off. But in my view, this uncertainty and the volatility for the coming weeks is part of the game.

On the other hand, to be honest, you have heard me last year already at this conference, I was actually quite positive about the initial announcement of the German government. At that point in time, we discussed the adjustments to the debt break we discussed the reforms. And yes, you wish always for more. And I think Germany actually needs to do more, and we need to get quicker in implementation. But if I look back over the last 12 months, I think this government actually did quite a lot. And you see now in various areas already the first green shots, obviously, in the area of defense, we can see it in the corporate bank. We, in particular, see it in the advisory business. If we think about mandates like TKMS and others. And therefore, I would say the Germany actually did the right thing. Now of course, this war and that volatility may be a little bit of a setback but it doesn't actually really change my long-term view when it comes to growth rates in Germany.

And I think we have been also very clear, Giulia, that in November at our IDD. We were talking about the growth rates of Germany. And we said that our own research thought that 2026 is actually -- Germany is growing at 1.5%. We actually had a much lower growth rate as an assumption in our plan. That proves to be right. So therefore, also with the impact of the war now, I have no -- I have actually no reason to adjust any of my plans in terms of revenues, in terms of investments because I do believe that we plan conservatively. And hence, yes, we obviously stay close to the issues. But at the end of the day, all of that, what happens in Iran, we are not talking about Russia and Ukraine anymore, but that is an ongoing war. We have obviously a building situation and a development in the AI segment. One thing is clear, all clients in this time and in such an environment, they need more advice, they need more risk management and what we clearly see day by day, they want to have a European alternative to the U.S. banks when it comes to Global Banking.

And therefore, look, you need to manage carefully. You need to manage cautiously. But the presence of Deutsche Bank and the global house bank strategy we have is, so to say, very well designed actually for the situation we are experiencing at this moment. And therefore, I would say that the situation around the world is not changing our outlook. We have been, in my view, cautious for 2026 and 2027 when it comes to growth rates. Therefore, I don't see any adjustments. And I talked to you, and I said already when I saw the polling that I think many of the other items where we talked about tailwind in November, AI deployment cross-collaboration, actually also further movements in Europe when it comes to level playing field, simplification of routes. All that actually looks better than in November. And therefore, despite all the volatility, I remain positive and my plan is the plan, and I think there is even upside to it.

Fantastic. And so if I follow up on something you said, European simplification. That's the best we can hope for in Europe. In the meantime, the U.S. is deregulating and freeing up several billion of capital for American banks. So how does this position Deutsche Bank, are you less able to compete because of that? Or what do you see on the back of this different trend in deregulation versus simplification?

Look also there. I think nothing over the last 4, 6 or 8 weeks or the announcements last week and then potentially what we hear on Thursday changing my view. We know that in which direction the U.S. was going. We see obviously what the U.K. is doing and therefore, I think we are engaging very closely with the European Union, with the commission. I know that Commissioner Albuquerque is speaking at 11:00. I think we have a constructive exchange. We have an open discussion with the ECB. And of course, we want to have a level playing field when it comes to regulations.

And I can see that with the way we discuss banking packages, whether it's market integration, whether it's securitization, I think both packages will be done end of May or June, to be honest. I think there is movement in that. the way we can discuss with officials when it comes to FRTB delay or what are we doing about it? I think the focus and also the willingness of the politicians to listen and talk to us and think about is there a disadvantage for European banks? Do we need to do something? This willingness is much higher than in the years before. Now can I already tell you the outcome? No, I can't. But I can clearly see that there is a lot of constructive discussions and that there is a lot of engagement, Giulia on the level of European CEOs actually talking to the commission, talking to the ECB.

My item, which I always want to stress, we can talk about simplification. We can talk about that where I think let's freeze the rules right now. There is no need when you look at the profitability of the European banks. Also the sustainability of this profitability don't go for higher capital, but freeze it right now. I mean, that would be the first signal, which is positive. But I really do think that in this regard, we have a much more open year from the European Commission and the ECB than before. My real ask is simply watch at the first line of defense. And what I mean by that is the sustainable earnings generation of European banks. This is what we need to take into account when we talk about regulation because 5 or 6 years ago, I understand that there was a bigger focus on capital and liquidity.

But now the profit generation and level of profitability of each and every bank in Europe is at a completely different scale than before. If this is mentally taken into account and if we can move the mentality in Europe from not only stability, which is always the #1, but also to provide competitiveness, then I think we are a real step ahead. And in this regard, we really have good and constructive discussions. And therefore, I'm positive that we see the one or the other change.

Yes. That's a very positive comment. I wasn't expecting you to say securitization and market integration package done by May. So let's hope that comes. Right. So AI is a big topic, of course. And it went from being incredibly positive, as you highlighted at the IDD to, well, AI is taking over the world, a massive disruption to software, maybe other business models. So when you lend to corporates that are potentially impacted by AI, be it software, business services, anything else? How do you assess this disruption risk?

I'm glad you're asking that because I think it's one of the most critical questions here, in particular, your lending book like we have of almost EUR 500 billion. And you know my past as Chief Credit Officer of this bank. And therefore, it is a question which we are dealing with and which we have dealt with for, to be honest, the last 12 months. I'm always pressing my people, I want you to understand business model of your client, the way AI is actually changing it, and now it comes who are, so to say, the winners and the laggards in each and every industry.

And I think I said it in one of these conferences before, I do believe that in this regard, Deutsche Bank has a very positive track record. We changed the way we are doing credit analysis in 1998. We changed it from a single client review to an industry analysis. And if you look actually how we cluster our exposures, how we look at exposures not only from a single counterparty review, but to a real industry and trend analysis, then I do believe that we have actually an advantage in spotting weaknesses or strengths in those industries a bit earlier.

And that shows me also how we size exposures. That shows me also what our risk appetite for different industries is, and I'm sure we are coming later to that, but we have been very transparent also last week in telling the world how much we have for technology and so on. But the most important is that the first line of defense, i.e., the front office people, but also the second line of defense, even credit risk management people are close to the management and are close to the underlying industries.

And the track record which we have shown and also the discussion level we have when it comes to AI, that we can say per sector in the technology where we rather deem people to be the winners or people being more under pressure is actually from a content level very, very deep. And based on that, we are setting our limits. We are setting our long-term exposure strategies and hence, I'm quite comfortable that we are actually -- or that we have a good view who are those people who are winning and where should we be a bit more cautious.

And that we have done, forget about AI now for a second. That we have done for industries like automotive, auto suppliers, machinery in all kinds of other industries for the last 25 years. And if you now look at the loan loss provision level of Deutsche Bank through the cycle, across these segments, we were usually superior to the industry. And therefore, I think this industry focus and having specialists for each and every industry in credit risk management, is a real advantage. And therefore, I'm quite positive actually that we will also go through this one.

Thank you. Very clear answer. So let's then move on to revenues. During Q4 results, I think the guidance was for revenues to be flat year-on-year in Q1, although you flagged a very good start to the year and potentially upside if it continued, but it was too early in the quarter to really be confident, I guess. So now we are towards the end of the quarter, how has that trend continued or changed?

Well, look, including today, we still have 11 trading days to go. And in such an environment as we are right now. You always need to, in my view, manage day by day and you should be cautious and conservative. But overall, I would like to confirm that what we said. I see revenues actually flattish year-over-year. Now the nice thing is -- and that speaks to the strategy, which we have given ourselves in November that the revenue mix is moving into the right direction.

And what do I mean by that? We have a very nice development in Asset Management and the Private Bank. Really glad that this is as we planned it, not only in November, but the years before, Claudio and Stefan doing a superb job in actually moving their business into the right direction, year-on-year increases. And that is obviously from a sustainability from a quality point of view, from a stability point of view, a really nice direction. In the Investment Bank, I think we are approximately flat year-over-year. Now the composition of revenues will be a little bit different, to be honest, Giulia.

I see actually an increase on the IBCM side, potentially a little bit lower on the trading side, but you need to take into account actually that we are actually in this regard, suffering from the FX development -- I mean, the FX development from last year to now for European bank being quite active also in the U.S. is obviously, so to say, a burden the underlying from a market share, if I adjusted for FX, honestly, we are rising in the trading business. I'm really happy with what Ram is doing, and we had a super Q1 in 2025.

And last but not least, if I all looked at and also the development in the corporate bank, all that is compensating a bit the C&O revenues because C&O revenues last year were higher than it will be in Q1. But that means from a quality point of view, the Q1 '26 revenues are actually stronger than 2025. Overall flattish, but to be honest, I'm really happy with the composition. And therefore, you need to look a little bit in the composition, but the composition is positive.

And if I move away from the quarter and look a bit longer term, one of the targets is 8% revenue CAGR in the corporate bank exactly. So can you remind us of the key initiatives that make you confident in this target? And also when can we see an inflection point? Because for now, actually, the trend is quite different in the corporate bank.

Yes and no because there is not so much an inflection point, Giulia, because even in the year 2025, underlying, we grew from a business volume, I think, by 56%, not yet 8%, I agree, but it was already 5%. But obviously, also there, we had 2 items which were running a bit against us, and that was on the FX side in 2025 and also, we had headwinds from the NII. Now we have deliberately said that Deutsche Bank also from its -- our roots from where we see, where we are. Deutsche Bank is very much a corporate bank. And we can actually see with all our investments we have done in our cash management tools in fee-generating businesses, look at that what we have now done and where we are onboarding to plan the Miles & more product, which we have taken over from another bank for Lufthansa.

All that is actually preparing for the next 3 years. We will see the corporate bank also year-over-year increasing revenues, in particular in the second half of '26. If I think about the loan book, if I think about what is happening in the defense area in Germany, I talked about green shots before. I can see what is happening on the investments, in the infrastructure. In both areas, we are starting to see the loan growth. We are also starting to see a nice development actually on the deposit side. So if I all look at this, I think the 8% is actually a number which we can achieve.

Is it an ambitious plan? Yes, it is ambitious. But the underlying growth, which we have seen in '25, the market share which we have in Germany, actually shows me that we can achieve it. And last but not least, I talked about that in times of volatility and uncertainty, the risk management advice from corporates to a bank is bigger than ever before. And that is something which we see day in, day out. And there, we actually benefit also from our global presence.

There are hardly any European banks left with a network of almost 60 countries in this world. And we can see that we are onboarding new clients in order to actually advise them in this situation. And therefore, I think the 8% is definitely doable, but therefore, we need to invest, and that is the reason why we invested in 2026, among others in the corporate bank.

And if I now talk about the private bank instead. So achieving ROTE [ 8% ] in '25 was quite a milestone, but now you are targeting more than 18% by 2028. So what are the key levers that allow for this increase in profitability? And also if I can squeeze some questioning there. How is the competitive landscape looking like? Because everyone is interested in gathering deposits in Germany with Chase, Credit Agricole. So how does that impact your plan?

Look, first of all, as I said before, I think Claudio has done a phenomenal job in turning around the private bank. Nobody actually thought that Deutsche Bank can ever earn money in the private bank. And I tell you what we have now achieved is Level 1, and we need to go to Level 2 and Level 3. We promised 18% in -- over the medium term, which we will achieve. And how do we achieve it is by 3 measures. Number one, growth in Retail Bank Germany in particular, in deposits and investment business.

And in this regard, everything what Germany is doing on the pension side is pure tailwind for us. You have heard about the private pension scheme for young people, even if it's only EUR 10 a month. It doesn't sound a lot, but it sets something in motion that people are thinking about, not only do we get the EUR 10, but what does it mean? What can I do about it? And this is actually a huge opportunity for us to talk about investment with our retail clients and not only our existing clients, but the next generation.

The focus actually Claudio is putting on that and that must be digitally enabled, and hence, we are also putting investments obviously into that is huge. I think it will be one of the largest growth rates, which we'll see the investment business for retail clients in Germany that will go only into one direction, number one. At the same time, we are not yet through our cost reduction in Retail Germany. We have an ongoing effort to do that, what everybody knows, in particular branch closures taking also reducing workforce. We have a clear plan for '26 and the following years.

We are, as I said, investing into technology in order to capture opportunities on the revenue side, but at the same time, making sure that every process we are running in Retail Germany is front to end and that takes out a 3-digit million cost number over the next years, again, simply in the retail business. So retail is really operating leverage poor, increasing the top line in particular via investment and deposit business, and I'll come to the competition in a second, but then obviously, reducing cost.

Second area is actually growth in wealth management and private banking. And you have seen us and heard us in November that we are actually expanding in that business. You have seen also in the public reports that we hired the one or the other people whether it was in Europe or in Asia. And to be honest, all I can see in the first quarter, not only how we ramp that up according to plan, in budget with discipline. But if I see the AUM development, it's very nicely. So Claudio is doing exactly that in wealth management, what he has done over the last 6 years, a continuation.

Now with the recovery also, and let's be honest, of the reputation of Deutsche Bank, the way we are seeing in Europe as one of the key European wealth managers is a completely different one than before, not only in our home country in Germany, but also in other countries like Italy, Spain, Belgium, where we are really gaining momentum. So wealth management is actually a growth story. And also for that, we can actually benefit from all the technology developments I was talking about in the retail segment. So it's a growth story, but at the same time, taking cost out.

Last but not least, everybody in this room knows the story is not only about revenues and actually direct costs. It's also about indirect costs. We have 2 areas left in this bank where we are not yet on benchmark in terms of cost that is run the bank cost in technology, where we are coming down. And obviously, the share for the private bank will go down and AFC and compliance. Laura has done a super job actually in remediating our deficiencies. We are almost done with that, and now we are actually taking the cost line. Now if those costs are coming down, it's obviously also beneficial for the private bank business. And therefore, my confidence level in the 18% is super high. It couldn't be higher.

Actually, I think Claudio can do more. On the competition, look, if you bank in Germany, I've been doing it now for 37 years. I mean it's -- from a competitive point of view, it's a tough market. We, I think, have shown over the last years that we can compete. We have seen, by the way, Giulia last year already that we had quite competitive deposit bids from other large European banks trying to do that in Germany. And we, on purpose, tried actually to compete, not with higher rates, but with a digital offer. And again, with the recovery of our reputation with credibility in Deutsche Bank, we have actually gathered more stable deposits than we thought.

And therefore, we have also brought to the market that we want to gain another EUR 50 billion of deposits over the next years. And looking just at the first 2 months in the year, I'm quite positive that we can achieve that despite all the competition come to Germany. But with the Germans, the brand name helps a lot.

Great. So I'll open it up to the room in a moment, but I just want to ask you a couple more. You touched a lot on costs there. And 2026 is going to be an investment year for Deutsche Bank. So outside in, what milestone, what achievements should we track to monitor these investments? And what will this mean overall for your cost base in '26?

Well, first of all, despite an investment here, let me be clear. Under this leadership, this bank will not lose cost discipline. Cost discipline is key for Deutsche Bank but that doesn't mean that you don't invest. And that's, again, what I can see in the first 2 months. I'm very happy with the cost discipline. But nevertheless, we are saying, in order to have a long-term journey in order to bring us to a cost/income ratio below 60%, we need to invest into technology. We also want to invest into people in order to grow, as I just outlined for the Corporate Bank or for Wealth Management, but also in parts of the IBCM business. But cost management at its core remains to the heart of Deutsche Bank.

The second one where you should measure us against also this year, despite being an investment year, we will have a positive operating leverage. We will have a stronger RoTE than in '25. It's not only about an investment year. We need to show progress on our trajectory in 2028. And we said, and we were very open, that we do believe that the real benefit of these investments is shown in '27 and '28. But 2026 will be a year where year-on-year, we will improve. And therefore, I think these 2 items that cost management and itself is an item which we watch with hawk eyes and then the year-over-year improvement. And then we have with [indiscernible], somebody who is very close to the individual investments and in our portfolio review meetings, which we are doing with the businesses. We see actually where the investments go and we track then the milestones to these investments.

And in case that wouldn't result in so to say, the direction which we would like to see, I think there is sufficient flexibility to actually adjust the course. Now we don't need for the time being because it goes into the right direction. But don't underestimate also our flexibility to act.

Thank you. Now my last question before opening it to the audience, on cost of risk. And you've guided for cost of risk to trend downwards, 36 bps in '25 towards 30 bps. But U.S. CRE remains challenged and also you have some exposure to private credit. What can you tell us to reassure investors that cost of risk is not going to see a spike?

Well, first of all, we have also shown in a, I would say, in a challenging year from a risk point of view in 2025 that we reduced our cost of risk as we actually forecast that is to the market. So hopefully, there is also credibility and also a bit of track record. Number two, if you look into the underlying segments, yes, commercial real estate is something in the aftermath, to be honest, where we had too high loan loss provisions, and we are all not happy with that. But we clearly can see that we have seen the peak and it will go down.

Is it completely normalized in 2026? No, but it will be far less than in 2025. So we have seen the worst in that. again, not full normalization, but we have seen the peak. On private credit, to be honest, Giulia on purpose, we went out with our disclosure last year -- last week, not last year. Last year, we also gave a certain disclosure. We feel comfortable with that exposure. We have done private credit, the long discussion with risk management, but also with Ram Nayak last week again. We have done private credit for more than a decade. I think we are a very solid underwriter in that business. We are working with clear risk management underwriting parameters. That means diversification of the underlying asset pool, maximum advance rates or loan to value. We look, obviously, sort of say, at the sponsors. We look actually that we don't have an overconcentration into certain asset class.

We have more than 90% investment grade we have a documentation which allows actually if we come to close to a potential LTV cap that we are asking for more collateral that we can act. All this, Giulia resulted then in more than 10 years, we have lost 0.01 cent in private credit. I don't believe, by the way, that the noise on private credit will go away short term. I think it's a topic. But the real differentiation is who is underwriting and what are your underwriting criteria.

And therefore, I think we have a very strong track record. I look at the portfolio, the transparency we have at the portfolio and therefore, I don't think that it is for us a particular risk. We need to watch it. We need to be close to it. We should never ever change our strict underwriting criteria. If we do this, I don't think that this is something which will result in a spike of loan loss provision. And hence, overall, despite the volatility in this world, despite the uncertainty we have, we do believe that 2026, we still have slightly less loan loss provisions than 2025 and that we achieved the 30 basis points over time as we indicated.

Thank you. Let me see if the audience has. Yes, we have a question here.

Good morning, and thank you very much for this presentation. Can you please update us on your large legacy and outstanding litigations and the investigation ongoing around the potential shortcomings in IML as well?

Yes. Look, whenever we have pending investigations, I hope that you understand that I cannot really comment on that because that is an issue now, so to say, between the official stakeholders like a prosecutor and the bank. I can tell you that this bank has significantly invested into remediating our KYC/AML ASC processes. Therefore, I was just very open and says, look, we have done a lot of remediation. Now it's actually all about making sure that we have a very efficient process that we invest more in technology there in order to make it also from a cost income ratio a more efficient place.

But I would say we have come a long, long way. And without going into the details, a lot what you are referring to is actually about legacy. But I can't say more. But I also -- at this point in time, I don't expect that this is something which is of material, material impact to the bank. But this is -- I can't say more to that. On the overall litigation side, again, if I look at the litigation pipeline, I inherited in 2018, and I look at it right now, I think the bank is in a much, much better place. And we have worked that down. We have seen in 2025, a year with particular low litigation costs. And I know that last week when we did our outlook, so to say, for 2026, there was some nervousness because we said that it's larger and I know, [indiscernible] would now be correct.

Significantly higher. More than 10 percentage points?

Yes. But look, please have a look from which base we are coming. So if you are on a very low base and that was particularly in 2025, then 10%, to be honest, is not a lot, right? So now people may get the impression, wow, there will be a spike. I wouldn't call it a spike. We will have normalized litigation costs, I think, in 2026. There are 1 or 2 items, which hopefully we can bring to a close.

By the way, there are also items where we expect actually to win a bigger case. Now whether this is in '26 or '27, I don't know. It depends on the court. But overall, I would say, if you compare today's litigation pipeline of Deutsche Bank to that what we used to have before, if you look at the underlying concentration risk, it's a much better place than before.

Is this a bank where you have no litigation cost? No, will never happen. Is this a bank where we have litigation costs, which are, so to say, in on a level where it doesn't really turn an annual net income number. I think this is where we get and therefore, I'm comfortable where we sit and we try to bring the last pending items home now.

Let me see if we have other questions from the room?

Could I ask you to talk about resource allocation through the lens of RWA growth? There was some uncertainty about the comments you made in the annual report. So maybe help us understand that. But also more broadly, the business mix implications of where that incremental RWA growth should be going and why?

Yes. So I'm glad you're asking this question because also there, we potentially had some questions from last week. Number one, to be honest, always watch the exit rate for 2025. And from the exit rate, we are then obviously giving the outlook. And it's true that 2025 exit rate on RWA was lower than we expected in particular in the corporate loan book. And therefore, when we think about growth in RWA going forward, number one, we are not changing our outlook overall on RWA.

But if you start from a lower exit and you still think that the growth is now coming in '26 and '27, then you obviously have a higher percentage growth. That's all. So we are not changing our capital plan. We are also not moving more into just to put it here into private credit or increasing our exposure there. It's actually in particular, corporate banking where we see real opportunities. We see some opportunities to be very honest, in the wealth management lending areas where we can do better. There are the one or the other opportunities also in the Investment Bank, but the focus is really on the corporate bank. And therefore, Giulia's question was right, are you still believing in the 8% growth, so to say, for the corporate bank?

And yes, we do because we can see now despite Iran, despite the uncertainty that corporate Germany slowly but steadily is coming back and that we see investments in there. Actually, we want to be part of that. So no change to our capital outlook, capital guidance nothing at all, but the exit point in 2025 was lower and therefore, a higher percentage rate.

Great. Do we have other questions from the room? I think I see a hand, yes?

Two questions on my side. First, on private credit. Is it possible to as bringing us more color about the off-balance sheet exposure because you gave the EUR 26 billion, which is on balance sheet and my understanding and also to have some color about sectoral exposure and which is behind the ABS exposure you have? And the second question is, I'm curious to know how would you rank possible risk in terms of level, looking for geopolitics, software, private credit? And do you see that?

On number one, I disappoint you because I think we were quite open and disclose because we are confident in the number, our numbers. So let others do their job now. And we are not giving even further details. I think we have given a lot. But I just told you about the diversification I told you about the investment-grade part in that business. I told you about our loan-to-value ratio. I think we are below 60% actually in that business. So there is a lot of disclosure out, which hopefully makes you confident number one. And again, that disclosure, and I want to put it here, was a signal of strength. That's why we did it.

Number two, risks I don't think that private credit, as I said before, is a systemic risk. But I'm also not saying that the noise level will end quickly. It really depends how your underwriting standards are. And therefore, I think private credit will be with us for the next foreseeable future. But at the end of the day, it depends the way you underwrite. Geopolitical risk, of course, is tied to volatility. Volatility is, obviously, in particular, for us as an investment bank with our trading arm is also a real opportunity if you handle it right. I think there is one risk which we shouldn't underestimate, and we are not talking a lot about that, and that is cyber because I think in these states and in particular, if geopolitical risks are increasing, we should have a real good handle on that.

And therefore, when we, from a management board point of view are talking risks, we have a good degree of our time actually spent on cyber risk. And what else we could do. We have invested significantly. I think we have fantastic people working on that. But it's certainly something which should not be underestimated. When geopolitical risks are high, usually cyber risk are also increasing, and that's something which is clearly on my mind.

Yes. And we have another question. I think, well, we have. Let's take the gentlemen over there.

Just sort of linking savings and investment union through the private credit discussion. I guess I'm just thinking about people are worried about the disintermediation that happened, who's carrying the risk, also the relationship between banks and the nonbanks that have been doing the lending. Now that we're thinking about what we're going to build in Europe with the savings and investment Union, were there mistakes made and how the U.S. set up the private credit system? Are there additional guardrails that need to be established to make a safer system as we think about how we build it in the case of Europe?

Well, to be honest, I think it would be quite arrogant if I'm not saying there were mistakes done because if I look at the overall capital markets in the U.S., they are far superior to that what we see in Europe. I think Europe should learn from the U.S., and I think the first step in order to have a viable savings investment union is actually not only that we need progress, and I'm sure Mrs. Albuquerque will talk about that, that we need that margin progress in Europe. The most important for viable savings and investment during is something completely different. It's the domestic capital markets in each and every country. We need a different pension system.

And that's why we, from the banks are so much. I know that [ Bettina ] is later here. Bettina and I are really asking and asking and recommending again. And again, we need a pension system change in Germany. If we achieve that, that is the basis actually for capital markets, and then in the next step, obviously, you connect these capital markets. But I think get your domestic pension in order, if you do this halfway, so to say, of a viable capital markets unit is already done. And therefore, I'd rather talk about that than thinking about what others may have done or could have done better. In this regard, the U.S. is ahead of us. If we work on our pension system, I think we can actually close the gap quite significantly.

Yes. We have also written a lot on the need for attention to develop the capital markets. So with that, Christian, thank you.

Thank you very much having me in.

Ladies and gentlemen, welcome to the Q4 2025 Fixed Income Conference Call and Live Webcast. I'm Mauritz, the Chorus Call operator. [Operator Instructions] The 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 Philip Teuchner, Investor Relations. Please go ahead, sir.

Good afternoon or good morning, and thank you all for joining us today. On the call, our Group Treasurer, Richard Stewart, will take us through some fixed income-specific topics. For the subsequent Q&A session, we also have our CFO, James von Moltke; as well as our incoming CFO, Raja Akram, with us to answer your questions. The slides that accompany the topics are available for download from our website at db.com. After the presentation, we will be happy to take your questions.

Before we get started, I just want to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect. Therefore, please take note of the precautionary warning at the end of our materials.

With that, let me hand over to Richard.

Thank you, Philip, and welcome from me. Over these last few years, we have significantly strengthened our foundations and positioned Deutsche Bank to further increase value creation in the years ahead by scaling our Global Hausbank. Post-tax return on tangible equity in 2025 was 10.3%, meeting our full year target of above 10%. We see this as a great start from 2025 towards our commitment of greater than 13% by 2028.

Let's look at how we delivered the improved profitability. As we explained at our Investor Deep Dive in November, we have transformed Deutsche Bank into a simpler, more focused business with a significantly improved financial profile. We delivered on our revenue ambition of around EUR 32 billion in 2025, an increase of 7% year-on-year or 26% since 2021 due to our diversified business mix and revenue composition. Cost discipline remains strong in 2025. Noninterest expenses came in at EUR 20.7 billion, down 10% year-on-year. We kept adjusted costs broadly flat and achieved a material reduction in nonoperating costs, reflecting lower litigation expenses.

Our 2025 cost base is nearly EUR 1 billion lower than in 2021, a reduction of around 4% over this period. Operational efficiencies enabled us to self-fund foundational investments in our technology architecture, control environment and client franchise. This cost reduction, combined with our strong revenue growth, created significant operating leverage. In 2025 alone, we delivered operating leverage of 17%, and our pre-provision profit was EUR 11.4 billion, up threefold since 2021.

All 4 businesses have delivered a reduction in their cost-income ratios and a substantial improvement in profitability since 2021, leading to double-digit returns in 2025, as you can see on Slide 3. Corporate Bank delivered revenue growth of more than 40% since 2021. The revenue mix benefited from a normalized interest rate environment and importantly, from our actions to increase fee income. This helped us to deliver stable revenues in 2025 despite lower rates and FX pressures. Going forward, the actions we took in recent years mean the Corporate Bank is well positioned to scale the Global Hausbank model by further leveraging its global network, product capabilities and client relationships.

Our Investment Bank has transformed also over the past few years. In FIC, our efforts were focused on deepening and broadening the franchise with targeted investments, which led to a gaining market share and increasing client activity by a further 11% in 2025 compared to the previous year. We are also repositioning Investment Banking and Capital Markets or IBCM, building on our German leadership and focused client offering, investing in sector and product expertise to expand our advisory and ECM capabilities while maintaining the strength of our debt franchise.

Private Bank has made tremendous progress with its transformation, creating a more focused, efficient and connected franchise with an improved cost-income ratio of 70% and returns above 10% in 2025. Our asset management arm, DWS, attracted EUR 85 billion of net new assets since 2021, with assets under management surpassing EUR 1 trillion in 2025.

I want to briefly address the next phase of our strategy on Slide 4. At the Investor Deep Dive in November, we set out a road map to increase return on tangible equity from over 10% in 2025 to greater than 13% over the next 3 years. We also set out our plans to further improve our cost-income ratio to below 60% from 64% in 2025. We plan to achieve this via 3 levers: focused growth, strict capital discipline and scalable operating model. As you made clear in November, we have all the levers to achieve our goals in our hands today. We also see upside to our targets if the environment develops positively. 2026 is about taking the next steps to successfully deliver our strategy, and we are encouraged by the strong start we have made so far to the year. Delivering on our 2028 agenda will enable us to put our long-term goal into reach, to become the European champion.

Let's now look back at a successful year with an overview of the quarterly developments, starting with net interest income on Slide 5. NII across our key banking book segments and other funding was EUR 3.4 billion in the fourth quarter and EUR 13.3 billion for the full year, in line with our plans when adjusted for FX effects. The Private Bank continued to deliver steady NII growth and improved its net interest margin by around 30 basis points year-on-year, reflecting higher deposit revenues and the ongoing rollover of our structural hedge portfolio.

Momentum continued in FIC financing with sequential growth in NII supported by loan growth. Corporate Bank NII was slightly up quarter-on-quarter, reflecting a significant deposit increase, which positions us strongly going into 2026. For 2026, we expect NII across key banking book segments to increase to around EUR 14 billion this year. We expect this increase to be mainly driven by the structural hedge rollover, expected to yield around EUR 600 million more in 2026 compared to the prior year, of which over 90% is locked in through existing hedge activity in addition to targeted portfolio growth in both deposits and loans. Further details on the hedge portfolio can be found in the appendix.

Looking at the development of the loan book on Slide 6, we can see that during the fourth quarter, loans grew by EUR 5 billion within operating businesses adjusted for FX effects. The underlying quality of the loan book remains strong. Within FIC financing, the growth momentum continued, mainly driven by new loan originations in asset-backed financing and infrastructure lending as well as by an acquisition of an aviation portfolio. We have also seen continued growth in the Corporate Bank portfolio, primarily within our flow and structured trade finance business.

In the Private Bank, we continued to deliver on our strategic commitment to a capital-efficient balance sheet through further targeted mortgage reductions. This net growth within our businesses has been partially offset by the repayment of a legacy position within Corporate and Other in addition to some hedge accounting effects amounting to EUR 2 billion in total. As we look towards 2026, we aim to further grow in most value-accretive segments whilst maintaining strict capital discipline. Growth is expected to be most pronounced within FIC financing and the Corporate Bank, with the latter benefiting from fiscal stimulus tailwinds in Germany.

Moving now to deposits on Slide 7. Our well-diversified deposit book grew by EUR 29 billion during the fourth quarter, adjusted for FX effects. Our portfolio continues to be of high quality, supported by a strong domestic footprint and a substantial level of insured retail deposits. Deposit growth was most pronounced in the Corporate Bank, where we saw substantial growth in sight deposits from corporate clients. While we expect some normalization of this growth in the first quarter, we are overall pleased with the strong client engagement and franchise strength. The Private Bank portfolio also grew during the quarter, supported by ongoing deposit campaigns in Germany. In 2026, our focus remains on growing SVA accretive deposits in the Private Bank and the Corporate Bank.

On Slide 8, we highlight the strength and resilience of our liquidity and funding base. We managed our liquidity coverage ratio to 144% at quarter end, reflecting our robust liquidity position. The surplus over the regulatory minimum increased, driven by higher HQLA now at EUR 260 billion. Notably, the increase in HQLA this quarter was supported by inflows to our Core Bank deposits at year-end. We maintain a high-quality liquidity buffer with 96% of HQLA held in cash and Level 1 securities, ensuring immediate access to liquidity. The net stable funding ratio remains solid at 119% with available stable funding rising to EUR 650 billion. This reflects our diversified funding base underpinned by a strong domestic deposit franchise and longer-dated capital market issuances.

Turning to capital on Slide 9. Our fourth quarter common equity Tier 1 ratio came in at 14.2%, a decrease of 30 basis points compared to the previous quarter, with a 44 basis points reduction related to one-off effects as discussed last quarter. These effects included the discontinuation of the transitional rule for unrealized gains and losses on sovereign debt and the annual update of operational risk-weighted assets. Higher market risk RWA reduced the ratio by 8 basis points as trading activity picked up to a more normalized level in the quarter, whilst credit risk RWA growth was offset by securitization. The impact of these items on the ratio was partially offset by 21 basis points of capital generation, reflecting our strong fourth quarter earnings net of AT1 coupon and dividend reduction.

Our capital ratios remain well above regulatory requirements, as shown on Slide 10. The CET1 MDA buffer now stands at 293 basis points or EUR 10 billion of CET1 capital. The 32 basis points quarter-on-quarter decrease reflects the lower CET1 ratio and 1 basis point of higher systemic risk and countercyclical buffer requirement driven by RWA changes. The buffer to the total capital requirement decreased by 12 basis points and now stands at 351 basis points.

Moving to Slide 11. Our fourth quarter leverage ratio remained flat at 4.6%. The discontinuation of the transitional OCI filter had an impact of 6 basis points. The 10 basis point reduction relating to an increase in cash and reverse repo was more than offset by a 13 basis point increase due to our EUR 1 billion AT1 issuance in November 2025 and the other CET1 capital increase drivers. Following the FSB decision to reduce the bank's G-SIB bucket from 1.5% to 1%, the 2026 leverage ratio requirement will reduce by 25 basis points.

We continue to operate with a significant loss-absorbing capacity well above all requirements as shown on Slide 12. The MREL surplus of EUR 23 billion, our most binding constraint, decreased by EUR 3 billion in the last quarter. Our surplus thus remains at a comfortable level, which continues to provide us with the flexibility to pause issuing new eligible liabilities for at least 1 year.

Let me touch on our credit ratings on Slide 13. After receiving 2 upgrades from each of the major rating agencies since the start of our transformation, we made further progress in 2025, evidenced by upgrades from both solicited and unsolicited agencies. In addition, Standard & Poor's raised our outlook to positive in the fourth quarter, driven by improving earnings and greater resilience. We are pleased by this recognition and continue to work hard to further improve our fundamental ratings with our mandated agencies.

I'd also like to inform you about 2 specific decisions we have taken. Driven by our efforts to optimize the liability stack and further improve our cost of funding, we will reduce our senior non-preferred issuance volumes compared to last year, also in light of further anticipated deposit growth. As a consequence, we will no longer seek to benefit from the notch related to Moody's Advanced Loss Given Failure or LGF analysis that is currently reflected in our senior non-preferred rating. Please note that this is a voluntary decision by the bank, bringing us in line with our European peers. The 10% threshold has been more binding for us than regulatory MREL requirements. The second decision concerns a number of mandated rating agencies at group level. To streamline our efforts and reduce costs, we will discontinue the MDBRS group mandate and focus on Moody's, S&P and Fitch going forward.

Let us now look at our issuance plan on Slide 14. We closed 2025 with a total issuance volume of EUR 18.7 billion, which is in line with our target range of EUR 15 billion to EUR 20 billion. During November and December, we issued roughly EUR 3 billion in senior preferred and AT1 format. In 2026, we have materially lower funding requirements compared to 2025 and target a full year issuance volume of EUR 10 billion to EUR 15 billion. The biggest driver of the reduction is lower senior non-preferred volumes following the decision regarding the Moody's LGF notch. Looking further into the future, our balanced maturity profile over the coming years results in relatively modest maturities of EUR 11 billion to EUR 12 billion per year.

As you will see, we took advantage of strong market conditions in early January and issued a EUR 1 billion Tier 2 bond. This transaction, alongside our recent EUR 1 billion AT1 security, achieved our tightest spreads since the introduction of these debt classes, underscoring the bank's improved credit profile. We have an upcoming call decision for a sterling AT1 instrument, which is callable in April 2026 by giving notification not later than March 31.

Based on current markets, there is a small positive revaluation impact on this instrument at current FX rates, and the coupon will reset to roughly 8.2%. As usual, we will take a decision on this security closer to the call date after considering several factors, including capital demand, refinancing levels versus reset, FX effects impacting CET1 as well as market expectations. Finally, on issuance. We updated our sustainable issuance framework yesterday, which, amongst other things, allows us to issue bonds compliant with the European Green Bond standard, something we plan to make use of over the coming months.

To summarize on Slide 15 and looking ahead, the delivery of all of our 2025 targets and objectives provides a firm basis for the next phase of our strategy to 2028, scaling the Global Hausbank. Business momentum going into 2026 has been good and sets us up well as we start scaling our franchise and benefit from the investments we are making. As we said at our Investor Day in November, we plan to show improvements in operating performance every year, including in 2026. Our asset quality remains solid, but we continue to expect provision for credit losses to trend moderately downwards in 2026 towards a lower expected average run rate of around 30 basis points through 2028. And finally, as we just discussed, our issuance needs this year are lower compared to prior years as we optimize our liability stack.

Before turning to your questions, I would like to take this opportunity to thank James for his support and guidance over the past years and to congratulate him on his achievements in Deutsche Bank's successful transformation journey. Let us now start the Q&A session, where Raja, who I'm very much looking forward to working with, will join James and me.

[Operator Instructions] And the first question comes from Lee Street from Citigroup.

I've got a couple of questions, please. Firstly, on Slide 13, and the decision not to defend the LGF notch for your non-preferred senior anymore. Just, I mean, the question is, how does that -- what does that mean to your end state stack in terms of the amount of non-pref you have outstanding? And I guess why now? Is it a question of cost? I mean, what's the driver?

And second question, just on the idea of talking about becoming a European champion and you've got your '28 targets, I suppose, what's the -- how should we measure that in practice? And who's the peer group for this? Because I guess if I look at your '28 return targets and cost-to-income, there's obviously still quite a lot of banks that will be likely better than that. So I mean, how are we actually supposed to think about that and measure that as actually being achieved? That would be my 2 questions.

Thanks, Lee, and thank you for joining the call. Happy Friday. So I guess I'll take the first couple of questions on the liability stack and the LGF, and then maybe Raja and James can talk about why we think about the European champion sort of metrics.

So I guess you had 2 questions. One was around, I guess, why now? And I guess then the second one was around what the impact could be. So I'll start with why now. It's very simple, really. We have been benefiting from the LGF notch in our senior non-preferred rating during our transformation phase, which is now in the rearview mirror. And during that period, we've seen 2 upgrades of our ratings with Moody's, which positions our senior non-preferred rating well within investment-grade territory. Therefore, we feel now is the right time to kind of move our positioning from defense to offense to do this step in order to optimize our funding composition and cost base further.

This step also aligns us with our European peers, which do not carry the option in their senior non-preferred rating. And so the decision will allow us over time, as you rightly intuit, to partly rebalance our capital market stack from senior non-preferred to senior preferred, making the overall balance sheet more efficient.

In terms of kind of like what's the sort of the impact around issuance volumes and how we think about that, then clearly, we can reduce the volume of outstanding senior non-preferred issuances given that before the Moody's LGF was our binding constraint. This will lead to a managed reduction of the headroom we have over TLAC as well as subordinated MREL requirements.

It's important to note that the TLAC and MREL headroom also depends on changes of, as you know, DB's RWA trajectory, leverage exposure and maturity structure of our issuance books. But when you take all that into effect as well, we'll continue to maintain an appropriate buffer over our regulatory requirements when we're thinking about our 2026 issuance plan. And as you can see, we're still going to be looking to issue EUR 5 billion to EUR 7 billion of senior non-preferred this year. But over time, we expect a lower yearly SNP requirement than in previous years and also in light of our balanced maturity profile. So hopefully, that answers your questions.

Thank you very much, Richard. Look, I think -- first of all, thanks for giving the opportunity to answer this question. On Page 4 of the deck, we have kind of laid out a little bit of our path to the European champion. And as we said in the Investor Day, our medium-term targets are around 2028, where we want to take our return on tangible equity up from 10% to 13%, which we think is the intermediate step to what ultimately is a longer-term objective to be the European champion. And I think it's a really valid question to see what does it really mean to be a European champion definitionally.

So assuming we get to 13%, and we have high confidence around that, the way we think about it is that in all the key segments that we engage in as a European-based bank, whether it's FIC or wealth management or asset management, we want to be in market-leading position. We already have a leading position in FIC in Europe. We are #3 in Asia. We are #7 in the U.S. So we have aspiration to be #5 in the U.S., and that would actually make us the leading European bank in that space. It's a matter of -- the second more quantitative threshold for that would be that from a returns perspective, we should be leading the returns versus our European peers, which today we have a little bit of a gap. So I would say it's business positioning. It's quantitative returns. And obviously, a little bit of it is what kind of bank we are, and we think we need to be an AI-powered bank.

The last thing that is actually not on the page, but we as a management team talk a lot about is, we also want to be a destination of choice to a place to work. Like I think if you have that reputation as a leading bank, then I think this is also a destination of choice for talent. And in terms of how you can measure it, I think over time between now and '28, we intend to obviously show, as Richard said, gradual improvement in all of our financial metrics, but it is also our intention to give the drivers underneath those growth, whether it's how we are growing deposits, how we're bringing new client assets, what we're doing with new client money, and how our market share is evolving, especially in the investment banking side. So I would say it's one of those things you will kind of see it when we get there. But in the meantime, we intend to provide the progress markers that we have set for ourselves.

Then the next question comes from Corinne Cunningham from Autonomous.

Thanks for the detail on the senior there. I wanted to come back to a slightly different angle, the commercial real estate. This has been dragging on for a while now. You've been given guidance or guiding that we should be at the end of the problem and then we're seeing higher provisions again. So specifically, what's going on there? And I suppose what's cropping up that you haven't already foreseen and provisioned that's meaning that you continue to have to keep topping up provisions on that?

Thanks, Corinne. It's James. Look, in a sense, we're following the new facts on the portfolio as we build additional provisions. And that can be, for example, new appraisals that come in lower than the early appraisals that underscored our marks. It can be lease activity for a specific building that we have lent against. And so if the tenants are departing, then the cash flows in that project obviously are impaired and that changes the valuation. And it can also be valuations in the marketplace that are visible and that we see outside of the cadence of appraisal updates. So those are the types of things that then feed into our valuations and cause us to build the provisions.

In the quarter, as we said yesterday, there was one exposure, sort of a larger single name event, that characterizes commercial real estate, but was outside of the office. So these things will happen from time to time. But in the broader commercial real estate, I would say the focal point remains office, West Coast office. And as we think about the tail, when we do see that stability in the marketplace in appraisals, in letting behavior, we'd likely see the CLPs drop dramatically. And just to be clear, West Coast is really our exposures that are challenged are in Seattle and L.A. And hence, I think some of the disclosure we've provided since the outset of this cycle, hopefully has been helpful in giving you a sense of what we've been seeing and contending with.

Any signs of light at the end of the tunnel? Or are you just taking it day by day?

As I said on the yesterday call that I had seen sort of, if you like, false dawns before, where we thought we'd seen stabilization in either appraisals or market only to see the market find another floor. So I'm cautious, my risk colleagues are cautious about calling the floor. That said, this late into the cycle and with hopefully, behavior starting to change and stability coming to the markets, we'd hope we're at the tail end.

And the next question comes from Robert Smalley from MacKay Shields.

And first, I want to say, James, I have appreciated the engagement, speaking for myself and this group here, and that everything you've done with respect to the fixed income community has really reflected in the bank's access and the bank's cost of funds over the years. And we've all really appreciated it. So thanks very much. You've done a lot of heavy lifting. And good luck in your next endeavor.

Thank you. Before everybody says it on the call, maybe I'll jump in to say thank you for the kind words to you and the other investors and analysts out there. The engagement with all of you has been great, and particularly those who've followed the story really carefully and been great supporters of the name in the marketplace, but also great sources of feedback for us. So I really appreciate the partnership over the years, and thank you for your words.

So do we. So thank you again, and best of luck in your next endeavor. Just one comment in terms of the rating notch and your plan. I think for the bank, it's important to follow economic and business imperatives rather than manufactured frameworks. Let's leave it there. Just in terms of 2 questions following up on Corinne. So as we look for resolution in CRE over the next couple of quarters, by its nature, it's pretty lumpy anyways, but can we expect some lumpiness in terms of resolution down the road, so we wouldn't be surprised at that? That's my first question.

And secondly, just the German yield curve is at its steepest since 2019. How is that impacting the way you look at the balance sheet funding? And what should we look for in terms of curve movement that might be beneficial or detrimental to the outlook?

Thank you for the questions, Robert. I will continue with the CRE questions. Look, if I knew for sure, obviously, I would tell you or we would already have booked to it. Generally, though, I mean, the portfolio, there's some granularity to the portfolio. And the types of adjustments, that I mentioned in answer to Corinne's question, will typically not be all that lumpy. I mean, they're sort of, again, valuation adjustments on a portfolio level.

It would be -- where there are lumps, it's when there's an event around a single larger exposure, and that event could be a restructuring or a sale. And there's only a handful of situations that could really produce that depending on kind of the course of a resolution action. So I wouldn't expect lumpiness. Again, setting aside the one larger exposure that, as I mentioned, is not office and has a different sort of characteristic to it.

And I will draw your attention again to the -- we've pretty much every year, since the cycle started, sold some portfolios. And the nice thing about those sales is they've given us a sense of kind of market pricing at each point in time, generally confirmationally relative to the valuations that we've had. And again, some of the individual assets that have been part of those loan portfolio sales have been relatively larger, again, giving us some sense that at each point in time, we were reasonably marked. So a little bit of color, but in general, we wouldn't expect lumpiness.

Rob, it's Richard here. And thanks for joining the call. So it's pretty simple on the rate side of things. So in terms of funding, credit spreads are much more important for us when it comes to funding, because we manage our interest rate risk at the point of issuance. And then from an NII kind of hedging perspective, as you know, we have a sort of, as with others, replicating portfolio, that essentially, as rates -- as those swaps roll off, if we can extend those swaps into 10 years at a higher rate than it is today, then that's beneficial. So all things being equal, we benefit from a steeper credit curve and tighter credit spreads is how to think about it. But in terms of our overall NII strategy that you've seen over the last few years as you kind of given those disclosures, we are pretty well hedged from an interest rate perspective for our moves up and down. But just the nature of that hedging strategy we have, we do benefit from higher long-term rates over time.

[Operator Instructions] So it looks there are no further questions at this time. So I would like to turn the conference back over to Philip Teuchner for any closing remarks.

Thank you, Mauritz. And just to finish up, thank you all for joining us today. You know where the IR team is if you have any further questions, and we look forward to talking to you again soon. Goodbye, and have a nice day.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for joining, and have a pleasant day. Goodbye.

Ladies and gentlemen, welcome to the Q4 2025 Analyst Conference call and live webcast. I'm Moore, the Chorus Call operator. [Operator Instructions] And 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 Ioana Patriniche, Head of Investor Relations. Please go ahead.

Thank you for joining us for our fourth quarter and full year 2025 preliminary results call. As usual, our Chief Executive Officer, Christian Sewing, will speak first; followed by Chief Financial Officer, James von Moltke. The presentation, as always, is available to download in the Investor Relations section of our website, db.com.

Before we get started, let me just remind you that the presentation contains forward-looking statements, which may not develop as we currently expect. We therefore ask you to take notice of the precautionary warning at the end of our materials.

With that, let me hand over to Christian.

Thank you, Ioana, and good morning from me. Let me start with the key message. We delivered on all our 2025 targets. Thanks to strong momentum across all our businesses, we reported revenues of EUR 32 billion. This represents compound annual revenue growth of 6% since 2021, the midpoint of our target range of 5.5% to 6.5%.

We self-funded this growth by achieving EUR 2.5 billion of operational efficiencies and delivered a cost income ratio of 64%, in line with our target of below 65%.

Asset quality remains solid. Credit loss provisions at EUR 1.7 billion are down year-on-year and in line with our most recent expectations. We delivered record profits in 2025 with pretax profit of EUR 9.7 billion and net profit of EUR 7.1 billion. Post-tax return on tangible equity was 10.3%, meeting our full year target of above 10%.

We see this as a great start towards our commitment of greater than 13% by 2028.

We are also delivering on our capital objectives. We finished the year with a strong CET1 ratio of 14.2% even after a number of capital headwinds absorbed in the fourth quarter. James will detail these shortly. And thanks to our robust organic capital generation and delivery of our capital efficiency program, we again raised distributions to shareholders.

With the proposed EUR 1 dividend per share and an authorized share buyback of EUR 1 billion, distributions in respect of 2025 will represent EUR 2.9 billion in line with our 50% payout commitment. As a result, cumulative distributions for 2021 to 2025 would reach EUR 8.5 billion, exceeding our original EUR 8 billion target. And we will be looking to do a further share buyback this year.

And importantly, over these last few years, we have significantly strengthened our foundation. We have positioned Deutsche Bank to further increase value creation in the years ahead by scaling our global Hausbank.

Let's look at how we delivered the improved profitability. As we explained at our Investor Deep Dive in November, we have transformed Deutsche Bank into a simpler, more focused business with a significantly improved financial profile. We delivered on our revenue ambition of around EUR 32 billion this year, an increase of 7% compared to the prior year or 26% since 2021 due to our diversified business mix and revenue composition.

Cost discipline remains strong in 2025. Noninterest expenses came in at EUR 20.7 billion, down 10% year-on-year. We kept adjusted costs broadly flat and achieved a material reduction in nonoperating costs, reflecting lower litigation expenses.

Our 2025 cost base is nearly EUR 1 billion lower than in 2021, a reduction of around 4% over this period. Operational efficiencies enabled us to self-fund foundational investments in our technology architecture, control environment and client franchise. This cost reduction, combined with our strong revenue growth, created significant operating leverage. In 2025 alone, we delivered operating leverage of 17% and our pre-provision profit was EUR 11.4 billion, up threefold since 2021.

This resulted in record profits in 2025 with pretax profit of EUR 9.7 billion, up by 84% year-on-year. The improvement in our profitability was delivered through the successful execution of our global Hausbank strategy across all our divisions as you can see on Slide 4.

All 4 businesses have delivered a reduction in their cost income ratios and substantial improvement in profitability since 2021 leading to double-digit returns in 2025. Corporate Bank delivered revenue growth of more than 40% since 2021. The revenue mix benefited from a normalized interest rate environment, and importantly, from our actions to increase fee income.

This helped us to deliver stable revenues in 2025 despite lower rates and FX pressures.

Going forward, the action we took in recent years mean the Corporate Bank is well positioned to scale the global Hausbank model by further leveraging our global network, product capabilities and client relationships. Our investment bank has transformed over the past few years. In fact, our efforts were focused on deepening and broadening the franchise with targeted investments into existing and adjacent businesses, reinforcing our world-class franchise.

As a result, we gained market share and client activity increased by a further 11% in 2025 compared to the previous year.

We are also repositioning Investment Banking and Capital Markets, or IBCM, building on our German leadership and focused offering, investing in sector and product expertise to expand our advisory and ECM capabilities while maintaining the strength of our debt franchise.

Private Bank has made tremendous progress with its transformation creating a more focused, efficient and connected franchise with cost-to-income ratio below 70% and returns above 10% in 2025. The Private Bank's 2 complementary business attracted EUR 110 billion of net inflows since 2021, setting a strong foundation for the next stage of our plan.

Our Asset Management arm DWS attracted EUR 85 billion of net new assets in the last 4 years, with assets under management surpassing EUR 1 trillion in 2025. And DWS, as a leading German and European asset manager with strong capabilities across asset types, is uniquely positioned to offer clients a gateway to Europe. We also delivered on our sustainability agenda across divisions.

Sustainable finance volumes were EUR 98 billion in 2025, the highest annual volume since 2021, with EUR 31 billion raised in the fourth quarter alone. And we have achieved a cumulative total of over EUR 470 billion since 2020. Together with significantly improved ESG ratings, our sustainable finance business activity sets a strong base to further strengthen and scale our sustainability agenda in years ahead.

Delivering on our strategy has created significant shareholder value, as you can see on Slide 5. First, improved profitability contributed to a 25% increase in our tangible book value per share since 2021 to almost EUR 31. And second, we have consistently increased shareholder distributions.

For the financial year 2025, we plan to propose a dividend of EUR 1 per share or around EUR 1.9 billion in total at the AGM in May. We were pleased to have received supervisory authorization for EUR 1 billion share buyback. The resulting distribution of EUR 2.9 billion are consistent with our goal of a payout ratio of 50% for 2025.

Including these proposed distributions, we would reach cumulative distributions of EUR 8.5 billion in respect of the financial years 2021 to 2025. And as I mentioned earlier, we will evaluate the possibility of an additional share buyback in the second half of 2026.

Before I hand over to James, I want to briefly address the next phase of our strategy on Slide 6. We have built a firm foundation for the next phase of our strategic agenda, which is all about scaling our Global Hausbank. At the Investor Deep Dive in November, we set out a road map to increase post-tax return on tangible equity from 10% in 2025 to greater than 13% over the next 3 years.

We also set out our plans to further improve our cost/income ratio to below 60% from 64% in 2025.

We plan to achieve this via 3 levers: focused growth, strict capital discipline and a scalable operating model. Disciplined execution will accelerate value create for our shareholders include further increased capital distributions. As we guided, we are increasing our payout ratio to 60% this year.

As we made clear in November, we have all the levers to achieve our goals in our hands today. We have planned prudently, and we see upside to our targets if the environment develops positively.

2026 is about taking the next steps to successfully deliver our strategy, and we are encouraged by the strong start to the year we have made so far. Delivering on our 2028 agenda will enable us to reach our long-term goal to become the European champion and banking as measured by a clearly defined set of criteria, a truly global bank domiciled in Germany, the largest economy in Europe and the #3 economy in the world.

A champion for our clients as their trusted partner in a world which remains uncertain. A champion for shareholders, reflecting the value we create for them and a great home for our talented people.

A final thought before I hand over to James. Today's results mark the end of an era in more ways than one. This will be the last quarter in which I sit down together with my colleague, James von Moltke, to discuss our results with you. James joined us in 2017, and as you know, I was appointed CEO the following year.

Since then, James has been a fantastic partner and a trusted counselor of Deutsche Bank's journey of transformation. It would be impossible for me to put into words everything James has contributed to what we have achieved on that journey. But there is one thing I can tell you, the successes we are discussing with you today are a great deal to James professionalism and his outstanding dedication to our bank.

And in the past few months, I have witnessed a seamless transition to our incoming CFO, Raja Akram, who had a great start. Raja, it is a joy working with you. Thank you, James, for all you have done for Deutsche Bank.

Christian, thank you for the kind words. Indeed, this is the last time I will present the bank's results before handing over the CFO role to my successor, Raja Akram. Doing this from a position of strength is something I'm particularly proud of. The management team and the entire bank have put tremendous effort into turning the bank around and achieving this milestone.

And as I said in November, we have significantly strengthened our foundations, rebuild stakeholder confidence and position the bank for sustainable value creation above our cost of capital in the years ahead.

Let me now turn to Page 8, a slide we have consistently shown since we made commitments to accelerate our Global Hausbank strategy and which shows the development of our key performance indicators. With a strong finish to the end of the year and continued execution, we successfully delivered against all broader objectives and targets we set for ourselves for 2025.

We maintained a strong capital foundation and our liquidity metrics are robust. The liquidity coverage ratio finished the year at 144% and the net stable funding ratio was 119%.

And let me add the proposed EUR 2.9 billion capital for dividends and share buybacks, which complete our distributions in respect of 2025 are already deducted from our CET1 capital, such that the 14.2% CE Type 1 ratio represents an excellent starting point going into 2026.

With that, let me now turn to the fourth quarter and full year highlights on Slide 9. Our diversified and complementary business mix enabled us to generate revenue growth of 7% year-on-year both in Q4 and for the full year. With normalized nonoperating costs this year and adjusted costs broadly flat, fourth quarter and full year noninterest expenses were 15% and 10% lower, respectively, year-on-year.

Our full year tax rate was 27% benefiting from the German tax reform and the geographical mix of income. We expect the 2026 full year tax rate to be around 28%. In the fourth quarter, diluted earnings per share was $0.76 bringing the full year to EUR 3.09, while tangible book value per share increased 4% year-on-year to EUR 30.98.

Before I move on, let me share my usual remarks on Corporate & Other with further information in the appendix on Slide 37. C&O generated a pretax loss of EUR 109 million in the quarter, primarily driven by shareholder expenses, legacy portfolios and other centrally held items, partially offset by positive revenues in valuation and timing differences.

Let me now turn to some of the drivers of these results, starting with net interest income on Slide 10. NII across key banking book segments and other funding was EUR 3.4 billion for the quarter and $13.3 billion for the full year, in line with our plans when adjusted for FX effects. The Private Bank continued to deliver steady NII growth and improved its net interest margin by around 30 basis points year-on-year, reflecting higher deposit revenues and the ongoing rollover of our structural hedge portfolio.

Momentum continued in FIC financing with sequential growth in NII supported by loan growth. Corporate Bank NII was slightly up quarter-on-quarter, reflecting a significant deposit increase, which positions us strongly going into 2026.

Overall, for 2026, we expect NII across key banking book segments and other funding to increase to around EUR 14 billion. We expect this increase to be supported by targeted portfolio growth in both deposits and loans, but the largest contributor will be structural hedge rollover of which around 90% is locked in through swaps. You can find details on the benefit from the long-term hedge portfolio rollover on Slide 25 of the appendix.

Turning to Slide 11. We maintained strict cost discipline throughout the year and delivered adjusted costs in line with our guidance at EUR 5.1 billion for the fourth quarter and EUR 20.3 billion for the year. As in prior quarters, the compensation costs were up on a year-on-year basis, primarily reflecting higher performance-related accruals.

For the full year, higher deferred equity compensation and the impact of increasing Deutsche Bank and DWS share prices also played a role. Noncompensation costs were down across categories, both in the fourth quarter and the full year. And similar to last year, fourth quarter bank levies were mainly driven by the U.K. levy.

With that, let me turn to provision for credit losses on Slide 12. Overall, provision for credit losses was stable in the fourth quarter as an increase in Stage 3 was offset by releases in Stages 1 and 2. Full year provisions stood at EUR 1.7 billion, 7% lower than in 2024 despite elevated macroeconomic and geopolitical uncertainty and ongoing headwinds in commercial real estate.

Net releases in Stages 1 and 2 provisions were mainly driven by improved macroeconomic forecasts with additional benefits from portfolio effects, partially offset by a net increase in over lease.

Key Stage 3 drivers were higher provisions in the Corporate Bank and CRE-related provisions in the investment bank, including one larger single name event. Private Bank provisions returned to a more normalized level. Wider asset quality remains resilient, and we continue to expect provisions for credit losses to trend moderately downwards in 2026 relative to 2025.

Turning to capital on Slide 13. Our fourth quarter common equity Tier 1 ratio came in at 14.2%, a decrease of 30 basis points compared to the previous quarter with a 44 basis point reduction related to one-off effects as discussed last quarter. These effects included the discontinuation of the transitional rule for unrealized gains and losses on sovereign debt, and the annual update of operational risk-weighted assets impacting the ratio by 27 basis points and 17 basis points, respectively.

Higher market risk-weighted assets reduced the ratio by 9 basis points as trading activity picked up to more normalized levels in the quarter, while credit growth was offset by a securitization benefit. The impact of these items on the ratio was partially offset by 21 basis points of capital generation, reflecting our strong fourth quarter earnings, net of AT1 coupon and dividend deductions.

Our fourth quarter leverage ratio remained flat at 4.6%. The discontinuation of the aforementioned transitional OCI filter had an impact of 6 basis points. The 10 basis point reduction relating to an increase in cash and reverse repo was more than offset by a 13 basis point increase due to our EUR 1 billion AT1 issuance in November and the other CET1 capital increase drivers.

Now let us turn to performance in our businesses, starting with the Corporate Bank on Slide 15. Corporate Bank closed 2025 with a solid financial performance, delivering a full year post-tax return on tangible equity of 15.3% and a cost income ratio of 62% providing a strong foundation for growth in 2026.

In the fourth quarter, Corporate Bank revenues remained stable sequentially as strong deposit volume growth offset the impact of lower deposit margins. Compared to the prior year quarter, revenues were essentially flat. Margin normalization and FX headwinds were largely offset by interest rate hedging, higher average deposits and a 4% increase in net commission and fee income. Deposit volumes increased significantly by EUR 25 billion in the quarter, driven by strong growth in site deposits towards year-end.

This underscores the strength of our client relationships and product capabilities. Adjusted for FX movements, loans grew by EUR 2 billion sequentially and by EUR 7 billion year-on-year, driven by both flow and structured transactions in our trade finance business. Noninterest expenses were essentially flat sequentially, reflecting disciplined cost management and down year-on-year due to the nonrecurrence of a litigation matter.

After low levels in prior quarters, higher provision for credit losses reflect a few Stage 3 events in the middle market. However, we do not see the most recent quarter as evidence of a pattern. For the full year 2026, we expect a modest increase in Corporate Bank revenues with accelerating sequential growth as the year progresses. Remaining interest rate and foreign exchange headwinds will impact the year-on-year comparisons in the first half of the year, temporarily masking the underlying business momentum.

As these effects diminish in the second half, we expect the year-on-year growth to be more pronounced.

I'll now turn to the Investment Bank on Slide 16. Revenues for the fourth quarter increased 5% year-on-year, driven by ongoing strength in FIC. FIC revenues increased 6%, representing the strongest fourth quarter on record despite lower levels of volatility driven by continued outperformance in FIC markets, specifically foreign exchange and emerging markets.

FIC financing revenues were slightly higher, reflecting ongoing momentum and targeted balance sheet deployment seen throughout 2025. Client engagement continued to be strong with full year activity increasing across both institutional and corporate clients.

Moving to IBCM. Revenues were slightly lower, driven by a reduction in advisory compared to a very strong prior year quarter. Capital Markets performance was broadly flat as higher equity origination revenues were offset by slightly lower debt origination with reduced LDCM revenues broadly mitigated by strength in investment-grade debt.

For the full year, the IBCM revenue decline of 6% was driven by mark-to-market losses on LDCM exposures early in the year and the business would have been essentially flat excluding these losses.

Looking ahead to the first quarter, the IBCM pipeline is the strongest it has been at this point for a number of years. Noninterest expenses were essentially flat year-on-year despite higher variable compensation and irrespective of favorable FX, reflecting continued cost discipline seen throughout the year. Provision for credit losses was EUR 97 million, essentially flat to the prior year.

Increased Stage 3 provisions, including one larger single name event were offset by lower Stage 1 and 2 provisions.

Let me now turn to Private Bank on Slide 17. In the Private Bank, disciplined strategy execution delivered 14% operating leverage, driving significantly higher quarterly profitability, supporting the delivery of a post-tax return on tangible equity of 10.5% for the full year.

Revenues of EUR 2.4 billion include NII growth of 10% year-on-year driven by higher deposit revenues, including benefits from hedge rollover while the prior year quarter was affected by the impact of certain hedging costs.

Net commission and fee income was essentially flat year-on-year with growth in discretionary portfolio mandates offset by lower income from cards and payments. Personal Banking revenues were essentially flat. Continued growth in deposit revenues was offset by the nonrecurrence of smaller episodic items and by lower lending revenues, reflecting our strategic focus on value-accretive products totaling approximately EUR 80 million. Excluding these impacts, revenues would have grown by 5%.

Wealth Management revenues also grew by 5% year-on-year, adjusted for the aforementioned hedging costs and 10% on a reported basis, driven by higher deposit revenues and continued momentum in discretionary portfolio mandates. Noninterest expenses declined by 11%. The cumulative impact of transformation-driven efficiencies and lower restructuring and severance costs was partially offset by higher performance-related compensation.

The Private Bank advanced its strategy with additional branch closures in the quarter, bringing the total closures to 126 for the year and contributing to workforce reductions of nearly 1,600 with further net reductions expected this year.

Net inflows into assets under management for the full year were EUR 27 billion. This was supported by EUR 12 billion of inflows and investment products as well as deposit campaigns in Germany. Provision for credit losses improved year-on-year with the prior quarter impacted by a small number of legacy cases in Wealth Management and residual transitory effects from operational backlogs.

Provisions in the third quarter benefited from model updates.

Turning to Slide 18. DWS is showing a significantly improved financial profile, over achieving its financial targets for 2025 as communicated 3 years ago, notably by reporting an EPS of EUR 4.64 for the full year. In Deutsche Bank's Asset Management segment, profit for tax in the fourth quarter improved significantly by 73% from the prior year period, driven by higher revenues and resulting in an increase in return on tangible equity of 20 percentage points to 41% for this quarter.

Revenues increased by 25% versus the prior year quarter. Higher management fees reflected an increase in average assets under management with higher fee levels from almost all asset classes.

Performance fees saw a significant increase from the prior year period, primarily due to the recognition of fees from an infrastructure fund. Other revenues also improved significantly compared to the prior year period, reflecting a small gain from guaranteed product valuations compared to a loss reported in the prior year quarter.

Noninterest expenses and adjusted costs were essentially flat as higher variable compensation costs were effectively offset by lower general and administrative expenses, resulting in a decline in the cost income ratio to 55% for the quarter.

Quarterly net inflows totaled EUR 10 billion with positive inflow flows across passive, including X-trackers, active and alternatives and reflected sustained long-term inflows across all regions and client types. The total inflows also include EUR 5 billion of net inflows in cash products, which were partially offset by EUR 2 billion of net outflows from advisory services.

Total assets under management increased to EUR 1.08 trillion in the quarter, driven by positive market impact and the aforementioned net inflows.

As you may have seen in DWS' disclosure materials this morning, DWS upgraded its ambitions for 2028 raising its EPS growth target to 10% to 15% per year and setting a performance and transaction fee contribution of 4% to 8% per year of net revenues. DWS now also targets a cost income ratio of below 55% for 2027 and has aligned its net flow ambitions with the targets we communicated at our IDD in November.

For further details, please have a look at DWS' disclosure on their Investor Relations website.

Turning to the outlook on Slide 19. Looking ahead, the delivery of all of our 2025 targets and objectives provides a firm basis for the next phase of our strategy until 2028, scaling the Global Hausbank. Business moment going into 2026 has been good and sets us up well as we start scaling our franchise and benefit from the investments we are making.

As we said at our Investor Day in November, we plan to show improvements in operating performance every year, including in 2026. We expect full year revenues to increase to around EUR 33 billion, aided by banking book NII growing to EUR 14 billion as well as growth in net commission and fee income. As I said earlier, we expect a modest increase in full year Corporate Bank revenues with accelerating sequential growth as the year presses. In the Investment Bank, we expect revenues to be slightly higher compared to 2025 with growth in IBCM revenues in line with the overall growth strategy of the business and essentially flat FIC revenues.

We also expect continued growth in the Private Bank with full year revenues slightly higher. Likewise, asset management should also see a modest increase in revenues.

Looking at the first quarter, in light of a normalization in C&O revenues and against a very strong FIC performance in the prior year quarter, our baseline expectation is for revenues to be flat year-on-year. Nonetheless, we are encouraged by the very good start we have seen in January. Noninterest expenses in 2026 are expected to increase to slightly above EUR 21 billion, in line with the trajectory provided in November.

This includes around EUR 900 million of incremental investments in 2026 to unlock growth and efficiencies as early as this year. Our asset quality remains solid. And as I said earlier, we continue to expect provision for credit losses to trend moderately downwards in 2026 as commercial real estate provisions ameliorate and other portfolios normalized, bringing us closer to lower expected average run rate of around 30 basis points through 2028.

The EUR 2.9 billion of capital distributions proposed in respect of 2025 bring us above our EUR 8 billion target for cumulative distributions in respect of 2021 to 2025. We also want to deliver attractive capital returns going forward, which is why we're increasing our payout ratio to 60% starting this year with modest but continuous growth in the dividend per share, complemented by share buybacks.

In short, our strong capital position and full year profit growth provide a firm foundation as we head into 2026 and we aim to deliver additional shareholder distributions in the second half of this year, subject to customary authorizations.

As Raja rightly said in November, we are ready to scale Deutsche Bank with focused growth and strict capital discipline and a scalable operating model at its core. For me, personally, being able to hand over the CFO role at a moment when the bank stands on strong foundations, enjoys business momentum and strong client engagement and is able to execute with discipline and purpose is deeply meaningful.

With that, I'd like to conclude my last set of quarterly remarks for Deutsche Bank with a heartfelt thank you to all employees globally for their hard work over the years to support the transformation of the bank and the delivery of our 2025 goals. I also want to thank our analysts and investor community for the high level of engagement over the years as you have followed the story and supported this management team in a myriad of ways.

Lastly, I want to take a moment to thank Raja for his partnership and efforts to ensure a smooth transition and to wish him every success as he assumes the CFO role. Christian, Raja and I look forward to the Q&A session. With deep dedication, thank you. And I'll now hand back to Ioana.

Thank you, James. Operator, we're now ready to take questions.

[Operator Instructions] And the first question comes from Nicolas Payen from Kepler Cheuvreux.

I just wanted to start by thanking you, James for all your help and support for over the years. It was much appreciated. I'm wishing you the best for your next chapters and I'm happy to welcome, Raja.

Then I have 2 questions, please. The first one is regarding your revenue guidance. Maybe could you clarify a bit how you intend to reach the EUR 33 billion of revenues with, for instance, as you mentioned, high CO, which was pretty strong and also the FIC trading, which we mentioned has a very strong by in January. And maybe also how the -- what are the FX rate that you assumed in your guidance? And if the recent moves had any impact on it? So yes, what are the different moving parts for the revenue picture in 2026 and also in Q1?

Then still for 2026, the operating leverage is likely to be rather limited as we invest quite significantly in the business. I think you mentioned EUR 900 million at the last IDD. So if you could elaborate on what are you spending the money on and how this will support your business going forward?

Nicolas, it's Christian. Thank you very much for your questions. I start with the revenue guidance. Also a little bit of the composition we see, and then I hand over to Raja with regard to operating leverage for 2026, also taking investments into account.

Look, first of all, I'm really happy not to stay too long about that, what we achieved in 2025 because it's nothing else than a very, very solid starting position for the next era of growth for Deutsche Bank. You have seen that actually the momentum is in each and every business, also in business like the Corporate Bank, even if it looks like a nominal number that we have a reduction '25 versus '24, if you really take out the interest rate pressure and you think about the operating growth which we have achieved, and it's a very, very positive story.

And that is actually something which we see continuing in 2026. We actually anticipate continued growth in every operating business in 2026 with a little bit of different levels and different dynamics at divisional level as we said in our prepared remarks.

Corporate Bank, modest increase full year over '25, in particular, with accelerating sequential growth as the year progresses. So all I can see also with the discussions we have with our clients on lending with the investments we have done into our fee business, I can see that this is ramping up. Then from our NII guidance, we have, there is a clear sequential growth in the second half, and that will lead actually that Corporate Bank will see a modest increase year-over-year.

To be honest, in this regard, the overall situation which we are facing in this world, the geopolitical uncertainties, the way the Corporate Bank works with the investment bank. And I said before, but it's coming more and more through that we are seen as the European alternative also outside Europe for the clients is gaining momentum, and therefore, I'm very positive that we see an increase in the Corporate Bank.

Investment Bank, we also see the revenues to be slightly higher compared to 2025. Now driven by IBCM, we said that also in our prepared remarks, we do believe that the investments we have done, but also that actually the movement, which we have seen in IBCM U.S. is going more and more into Europe is gaining traction. And if only the last 8 weeks is a guide in terms of pitches we have done, mandates we have won in particular here in Europe, then I'm very optimistic that Ellison's strategy to reposition IBCM, in particular on the advisory side, is actually being very, very successful.

On top of that, if I just look at our, sort of, say, existing and traditional business in the IBCM business like debt origination super-strong start in January. And I do believe that this is further pushing the growth.

Now you see we are conservative, and that is because we have actually planned FIC to be, so to say, essentially flat for the year. Again, if the last 3.5 weeks are only a guide for what is happening, I think then this is very conservative. And -- but it gives us the buffer for further increases and also potentially compensating other items.

So a really good start. And again, the momentum we see in the investment bank, be it on the trading side, but also on the advisory side, very, very good.

Private Bank is simply expected to show continued growth, with full year revenues higher than last year. Where does it come from, from both sides, Personal Banking, I talked in November very extensively with Claudio about the chances we have on the investment side. You have seen over the last 2 months, actually, what has happened in Germany when it comes to the restructuring of the pension system in Germany, more and more efforts and emphasis is put on private pension.

And here, we have a huge chance and we see it simply by looking at our assets under management in the Personal Banking how it's growing.

And on the wealth management side, to be honest, I'm very happy with the progress Claudio is doing, not only what he has shown in '25, but actually, that he is continuing and is actually executing on the growth in terms of hiring people, and we have seen, I think, in the first 3 weeks of January, we have already from his anticipated growth, 24 people relationship managers on the platform, another 40 have been hired.

And there, you can see that everything we told you in November is playing out, and it will go into growth. And if I just look at the assets under management, it plays favorably.

So Private Bank larger or higher than last year. And asset management, likewise, I mean you saw last night's ad hoc and also the reaction this morning. Very good job by Stefan Hoops, I think he has positioned DWS in the asset management as the European alternative. We see the growth in that business. And therefore, I'm confident that also asset management over a record year in '25 sees another increase.

Now if I put this all together, we will be at EUR 33 billion. And again, I just gave you a little bit of feel how January started, that it's not only confidence, I have a bit of hope. And that brings me to a hope in terms of doing it more.

Now that brings me to Q1. Q1, we plan essentially flat over last year. Never forget that last year, we had a fantastic Q1, in particular, in the Investment Bank and in FIC. Now again, I think it's a right plan to do this. However, if I see the first 3.5 weeks in FIC, then there is hope that we can even overshoot that. And therefore, I do believe what we see right now is that the positioning in each of the 4 business is having a real momentum is helping us.

And if I then see the EUR 33 billion of revenues, which we will have in year 2026 compared to the quality of revenues in 2025, where we'll also benefit from C&O and the benefit from C&O will be lesser in '26 and '25, it's even a better bank. And that makes me so confident that we have strong qualitative growth in each of the business.

Raja, would you take the other question?

Nicolas, this is Raja. Thanks for taking my first question as an incoming CFO, I think you had 2 questions. One was on FX and what we had planned around that. I think the December FX, which is based on our planning is around $1.18. Today, we're around $1.19 has implications on both top line and the expense. But at this point, where we sit, given the magnitude of our revenue and expense base, I think it's completely manageable. Obviously, we will evaluate it if there are any course of change.

On the other question that you had about operating leverage, you're absolutely right. We committed in the Investor Day to a $1.5 billion investment program over the last -- next 3 years, of which almost less than half was slated for 2026, but let me also remind you, we also signed up for $2 billion of operating efficiencies over the same period, which also began in 2026.

Now the mix of investments and the operating efficiencies, obviously, is different given its first year. So that will obviously have an impact on our reported operating leverage. I'm not a big fan of doing things excluding things, but I would just say that the underlying operating leverage of the business is extremely strong. And what we are really excited about is that with these investments, the incremental operating leverage that will generate in 2027 and 2028 will be exponential. So yes -- but that said, we are absolutely committing to absolutely having positive operating leverage starting in 2026. And as Christian said, let's see how the revenue trajectory plays out and also how our calendarization of the investments plays out because, obviously, that's something that we completely control. But at this point, we are absolutely committed to our expense guidance in the IDD, which was, if you remember, around 3% over 2025.

The next question comes from Flora Bocahut from Barclays.

First of all, James, thank you from me too. And obviously, wishing you all the best. Moving to the questions. The first question is on the excess capital usage. You just closed the year now at 14.2% CET1, that's after the distributions that you announced today. You say very clearly, you want to do potentially another buyback later this year. So can you maybe tell us how, at this stage you are thinking about using the capital that you already have in excess and that you will continue to build this year between reinvesting into your organic growth, potential M&A, so external growth or additional distribution to shareholders?

And can I also maybe just clarify on FRTB, if there's any new news regarding the magnitude and the timing on the capital walk?

The second question would actually be on the deposits because there was a good deposit growth this quarter. And actually, we have more and more banks that are talking about tougher competitive pricing across various geographies. Obviously, Germany is a market where we continue to see appetite from some of your competitors to try and gain share.

So can you maybe elaborate on what it is you expect in terms of the deposit volume growth as well as pricing, especially for Germany, but actually for the various markets, that would be helpful.

So let me start with capital. Let me take you back a couple of months where we clearly kind of laid out our capital cadence, the top priority being safety and soundness and resiliency, clearly, with the 14.2% capital ratio, we have kind of put that to bed. And as you -- as I mentioned, we said that we would like to operate between a range of 13.5% to 14% on an ongoing basis.

James talked about the authorized capital distribution that is already coming for 2026. And I think we also have now a plan to start an in-year buyback rhythm, which we did not have previously. So we expect that we will be doing buybacks during 2026. And obviously, the cadence of that will be dependent on how the revenue and trajectory is going and the timing.

So we absolutely commit to that. I will also remind you that from an M&A perspective, it was kind of on the bottom of my list of capital hierarchy. We remain open to opportunities as every management team should be. But from our perspective, and Christian and I share the same view that it has to fit various criteria of strategy, culture, financial before we will consider that. So at this point, if it was up to us, we would like to do return to the shareholders because they deserve it. And in fact, we're generating a lot of capital that needs to be deployed. And we -- if we see business opportunities we will do that. But with a 14.2% ratio, honestly speaking, we feel pretty well set up for business opportunities that should allow us to continue with our buyback rhythm.

On FRTB, I think we had mentioned at the Investor Day for the purpose of planning, we actually had left that in there. Now look, if you were to ask us today with that in the absence of concrete information, that assumption probably looks a little bit conservative in terms of us assuming that, that was going to come as planned.

So we remain hopeful that the right thing will be done there from a European perspective. And then -- and at that time, obviously, we will make a change.

The last part on deposits, it is clear that there's been some competition and there are teaser rates that our competitors are bringing in. We're actually running a campaign on Private Bank right now. And after the third -- 3 weeks of January, actually, we're pretty confident that our planned growth strategy for deposits is going to work out. We think that our value proposition and our access is something that is not that easily replicable from people coming outside.

Same thing on the Corporate Bank, we have not seen too much deposit pricing trends changing, there's been some stability in the payouts. But remember, on the Corporate Bank side, it's just not a matter of pricing. It's the capability that comes with it is do they have the operational reliability? Do they have the network to move cash around? So in that sense, with our very unique footprint on corporate -- with corporates around 60 countries, it kind of gives us some advantage of continuing to take operational deposits without having to compete on price.

And last thing I'll say to you, this might be the first 3 weeks of January, but I think the good challenge that we may actually face this year would be actually an abundance of riches where we may actually have to decide which deposits do we really want to take versus turn down. So at this point, I would say we feel pretty confident about our ability to potentially meet or exceed our deposit targets.

Flora, just to add one comment on the regulatory question and I completely agree with Raja. I witnessed over the last 12 weeks, but in particular, over the last 4 weeks. And this can also be an impact of all the geopolitical discussions a real reconsideration on the European side, what happens with regulation.

And therefore, the word simplification, the word reduction of regulation in certain items is gaining speed. You have heard our Chancellor there were discussions also around doubles on that topic. So completely agree. While we don't have now a concrete decision on FRTB, I would be more than surprised actually if this would come into play. And therefore, we see that as an absolute cushion in our plan an absolute advantage that potentially on the side, we have also too conservatively.

Then the next question comes from Chris Hallam from Goldman Sachs International.

Two from me. First on CLPs. You've guided for them to come down year-over-year in 2026 and then trend down towards 30 bps. How much of a step down should we expect this consensus, I think, has around EUR 150 million. And what trends are you seeing both in Q4 last year and at the start of this year that give you confidence on that trajectory? That's my first question.

And then secondly, James, taking a step back, you've been CFO since 2017. And from the outside, we can all see the change in the business over that period, not least of which the higher returns, but also the fact the bank is now distributing capital rather than raising it. But from the inside, from your perspective, what main changes you've seen during your tenure that might be a little bit less obvious to us and how do they inform the future outlook for the bank from here?

Thanks, Chris. So I'll take both. Raja, may want to add to the forward on CLPs, but let me just start with the fourth quarter. We said in our prepared remarks that the Stage 3 was higher than we might have expected. And as you saw, essentially run rates in both Private Bank and Corporate Bank stepped up a little bit, but we don't think those are necessarily sort of indicators of a trend. And I would put the kind of natural run rate on both on a quarterly basis, just moderately below where we were in the fourth quarter. .

As we said as well, we see the overall credit conditions in both book to be reasonably stable, in fact, in some cases, improving.

The Investment Bank obviously had a higher Stage 3 than we would normally have. Clearly, a big feature of 2026 is the CRE tail, how big and how long it takes to wind off, and obviously a nonrepeat as well of the single name item that we referred to as well. So short answer, Chris, is I think a normalization of Stage 3 run rates, strong credit quality generally and this sort of amelioration of commercial real estate all play into what would be at least a modest reduction in CLPs this year. Raja said trending down to 30 basis points. I think that's appropriate. We were at, I think, 38, 36. And I think there's a couple of steps perhaps still to go before it fully normalizes in that area.

Thank you for the kind question about my time as CFO, Chris, it's -- I mean there's a lot to look back on. But I guess 2 points I'd make. One is we really changed the culture in the firm and this is -- Christian and myself and the management boards of the time around accountability and discipline in terms of delivery. And I think that is -- that culture will stick in the organization.

So that's something, I think, that is a significant change. Obviously, the finance functions played an important role, but by no means alone. COO risk in the control functions have been very important. And then in some senses, most importantly, it's also being adopted and internalized in the first line. So I think that's a major change for the organization.

Going forward, I'm genuinely excited about the impact that SVA can have on the organization, and we've talked about that a little bit in the briefings. Again, that's -- we've -- it's been, if you like, originated and led out of finance, but it's been adopted by the organization wholesale. And I think the willingness to guide decisions through the use of the SVA tools, has been embraced in the organization, and I think it will have a significant impact in the year's end.

Chris, it's always hard for James to talk about himself, but let me add 2 or 3 items. I think the integrity and the credibility he has given Deutsche Bank to the market, again, is simply outstanding. We would not be there without his work, but also without his integrity and credibility without his work. So that is something where we are all benefiting from and that discipline is now so instilled in the bank, but it's one of his greatest achievements.

Secondly, next to all the day-to-day work and KPI management holding us responsible. There is one other thing which makes him an outstanding CFO. And that is last year, you all remember that we took our target down on the cost/income ratio from 62.5% actually, we took it up, the cost/income ratio to 65%. And James and I, we got criticized because it was sort of say, a deterioration. We did it on purpose because we saw the long-term chances of the investments at that point in time. And you don't find too many CFOs who move voluntarily away from an own target, which is to the heart of a CFO to do the long-term better of a bank, and that is James.

And that is something where, I would say, really, thank you, James, because again, that long-term thinking has really created a completely new culture in this bank. And there, we are benefiting all from it in all business divisions, and I think it's actually the secret of success of Deutsche Bank going forward.

The next question comes from Anke Reingen from RBC.

But firstly, thanks -- thank you very much, James, and all the best for the future. So in terms of the questions, just in terms of the -- apologies, just for the cost trends, the EUR 21 billion approximately in 2026, can you talk a bit about the trajectory in the course of the year in terms of the investments coming in and potentially leading to higher costs in the first half to second half, apart from the normal seasonality, but just in terms of your spending plan?

And then secondly, on the additional capital distribution. The way you seem to be talking, it seems to be with more confidence that there is an additional distribution coming. So I just wonder when should we be thinking you could be revisiting another distribution? And are there any moving parts like regulation disposals we should be aware of that, that would help to additionally inform that decision?

Thank you for your question. Let me take the first one and then Christian may want to also add in his views on the second one since I express mine. I think on the investment side, look, the great part is that these are our own investments, meaning that we are deliberately and diligently making them. So we do have some control over how we pace them. That said, you would naturally expect that there will be a natural buildup over the year as the hiring gets done, as the technology dollars get deployed. But at this point, we would not expect that any one quarter would be extremely outsized one way or the other. I think you could expect to see a slow trajectory upwards and then stabilizing over the course of the year. That's the way we think about it.

Obviously, the revenue environment will drive if we do better than on revenues and we expect it will drive volume-driven expenses and other related expenses, which is something that we have now projected based on our current revenue plan, but let's see how that plays out. But at least that's the path for investments.

Anke, Raja indicated that with regard to share buybacks, first of all, very happy with the approval we have in hand for the EUR 1 billion. It brings us there what we promised actually above EUR 8 billion. I think it's now on us, to be honest. And like we have done it in the past, we need to deliver. Again, in my view, it's now Q1, and then also, obviously, Q2. And then I think if we do this, and I don't see any sort of say, clouds for the time being that we can't deliver then I think we have all the right to have another discussion with the regulator. I think we gained credibility with the regulators around the world, but in particular, also with our home regulator here. And if we deliver on our plan, to be honest, and if we are showing capital ratios like we do it right now, there is no reason why we shouldn't ask for another one.

Now to give you a confirmation when this is exactly happening, it's too early, we should be fair. Let's deliver first, but we have done this for the last 5 years, and therefore, I'm confident that we will also do it this year.

And the next question comes from Tarik El Mejjad from Bank of America.

Just a couple of questions on my side. First, I would like to challenge you on the EUR 33 billion revenues, more to the upside. First, on the Corporate Bank growth, I mean, you insist on modest growth, but I think you have a self-help strategy there, which you go back to the kind of some corporates that you've lost focus on and you capture this growth, which is completely independent from actually how the market will do.

And also, I wanted to confirm on the Corporate Bank, how much you still price on your outlook, a potential pickup on the benefit of fiscal stimulus towards the back end of the year. I mean, same for IBCM, the pipeline was good, FIC is flat. I mean, you guided for flat, but clearly, I mean, all indicates for volatility will stay with us and January should be a good indication of what to come.

And also on NII, I mean you're talking of deposit growth with Q4 as an exit rate, which basically implies that a full year guide before even considering the hedge, if you can help me as well square that.

And the second question is on the capital return. Really just to confirm that the extra share buyback you could have in the second half would be as a special from '25 earnings and not an advanced buyback on the '26 earnings accrued. Just a clarification on this. And lastly, I don't know how much you can comment on the news yesterday on this remainder AML issue. I don't know how much you can say on that.

Thanks, Tarik. Let me take the first question, and I'll let Christian respond to the penultimate question. Look, I think we actually feel pretty good about the EUR 33 billion. The reason that I feel good about EUR 33 billion is because it is not dependent on any one business delivering outsized performance, but actually everybody is doing a little bit better than what they did.

Now the Corporate Bank is an interesting question, and I fully appreciate why there's a little bit of skepticism on that. But honestly speaking, that is the one that I actually have the most conviction on because under the surface, what I see is a bank that is actually growing super healthy. Just to put some things in perspective, in the last year, we actually grew net fee and commission income in the Corporate Bank by 5%, which was almost entirely offset by the margin compression on the interest rate side.

And if you look at 2026, we believe we can certainly do better than 5%, and in fact, the margin compression headwinds are now starting to subside even on a reported basis. So if you just put that together, we should see positive momentum on Corporate Bank and at what we're seeing on the deposit side, we're doing pretty well. So I think that we actually are pretty well set up.

The other thing that -- the data point that I'll give you on the Corporate Bank is that we actually have underlying loan growth in Corporate Bank that was in excess of 5% to 6% last year. But based on our SVA decisions, we decided to exit or reduce our exposure to a couple of products where we actually didn't want to be in. So the underlying growth of the loan volumes, putting the German fiscal aside for a second, is actually super, super healthy. At some point, the SVA process will play its course and the loan growth even on a reported basis will be much higher. So I actually feel pretty good about the Corporate Bank because, one, the idiosyncratic FX headwinds and the margin compression, which were all a feature of 2025, which made it a very complicated story. In fact, we probably need a separate Analyst Day just to discuss Corporate Bank and its trajectory is all kind of subsiding giving us confidence that the second half of the corporate bank is going to be showing sequential growth and year-over-year growth. So let me put that aside.

The other thing is on the IBCM side, we spend a lot of time with our teams, not just on an aspiration basis. The pipeline that we see today is at least double digit higher than in 2025, whether it's on investment-grade debt, it's a leverage lending or it's M&A. So there too, we are seeing signals that gives us some conviction that the revenue growth over there. Remember, we are planning for a little bit over 3% revenue growth versus what we have done in the past. So that is obviously dependent on a flat FIC, which Christian had talked about, so I'm not going to go there again.

So lastly, on the interest income side, look, we are projecting to go to around from EUR 13.3 billion to around EUR 14 billion, almost half of that is already kind of baked in with the hedge rollover and alongside the deposit and loan growth that I mentioned, I think the conviction on interest rate -- interest income as it stands today, is pretty good.

I think our focus now is to make sure that our investments get deployed correctly and with agility because we also want to see the one thing that you did not mention, we also want to make sure that our client assets and our net new assets get the same momentum that we want because that obviously is very value accretive for us.

So all in all, I would say going from EUR 32 billion to EUR 33 billion and offsetting some of the C&O headwinds with the Corporate Bank recovering is actually something that we feel pretty confident about.

So on capital, just briefly, Tarik, I just want to make sure you heard us right. Our expectation is that an additional buyback request in the second half of the year would be in respect of 2026 earnings, not '25. I think as you've heard Raja speak to, that is -- and also to Anke's question, that is distinct from in time the question of whether there are excess capital distribution. So think of it as additional distribution is potentially coming from 2 different sources, accelerating of in-year earnings and at some point in time, once we've established that capital is excess on a sustainable basis, potentially excess distributions.

On the last part of the question, obviously, there's relatively little we can say. We obviously confirm that the fraction prosecutor paid a visit to our offices. Obviously, we see the timing is unfortunate. The prosecutor is looking for information, as you saw in some of the reporting yesterday, on transactions that date back to the period between 2013 and 2018. And the allegation is that on that basis, there's potentially delayed suspicious activity reporting. Obviously, we need to follow the facts and work with the prosecutor on the investigation as ever, we cooperate as we're doing fully with the investigation. It actually builds on earlier investigations of a very similar nature. And so we will continue working with the prosecutor's office. The last thing to say really is we do not anticipate that it will have any impact on our financial or strategic plans.

And thank you, James, for all the interactions. And Raja, just to be clear, I'm actually thinking there is upside to the EUR 33 billion. I was just trying to see [ where pockets for upside ]. I'm quite above actually your guidance on '26. Just to be clear.

Good to hear.

And the next question comes from Giulia Miotto from Morgan Stanley.

And thanks, James, also from my side for all the dialogue and all the best for the future. So I have 2 questions. One is on the Private Bank fees in the quarter. If I think -- I mean, this seems to me one of the best areas for upside going forward, given that the Postbank is now on the same systems, given the momentum in investments in Germany, et cetera, yet, it was disappointed in the quarter, it was flat year-on-year. There is no growth. So when can we expect this potential to start materializing on the private bank?

And then secondly, just on SRTs, what should be a base case assumption in our model for SRTs that you plan over a year?

Giulia, I think Christian is going to take your private bank question.

Giulia, look, as I said on the first question, overall, year-over-year, we see increase in Private Bank. And again, coming from the domestic business in the Personal Bank, in particular, on the investment side, but then also from -- in particular, the growth and the hirings Claudio is doing on the wealth management side.

And that I actually expect that based also where the markets are that I expect an increase already in Q1. It is not something which is just backdated, so to say, to the third or to the fourth quarter. I see a continuous improvement on the Private Bank. And the Private Bank is in this regard, always for me, which I watch with 2 eyes, number one, the constant increase in revenues, in particular, driven by the investment business. And you see it in the assets under management continuously growing. But at the same time, and Claudio just illustrated that again, that we are working on our costs. We will have another 100 branch closures just in 2026. It is part of our plan. It is, so to say, all in implementation. And you will see that also the operating leverage in the Private Bank will further continue.

And hence, I do believe that already next year or this year in 2026, you will see another nice increase in the return on equity of the Private Bank because last but not least, it's not only the Corporate Bank, which is working from an SVA point of view on certain sub-portfolios where we can do better, same is done actually by Claudio. And hence, I can see a nice continuous development in the Private Bank, and you will see it already in Q1.

Giulia, it's Raja again. I hope everybody is down there. I think I'll just add to Christian's point on the Private Bank, you should expect to see growth in the Private Bank throughout the year. I think that is the way we are seeing the trends develop. I think your second question was about SRTs, if I caught it right. I think, as I mentioned, we have a plan for increasing SRTs by approximately 25% over the next couple of years. We've actually demonstrated very strong access to the SRT market in '25, and we're going to continue to use and expand the use of this tool. And it obviously helps us with capital and SVAs, but the plan is the same, EUR 5 billion incremental for '26-'27.

Then the next question comes from Kian Abouhossein from JPMorgan.

Yes. First of all, James, thank you very much for your support, helping us to understand the bank a bit better. So we have a better understanding than before, so highly appreciate it. Secondly, in terms of question, the first one is on revenues again, but less around '26, we have roughly 3% growth guidance versus your target, which would then imply more like 6% over the next 2 years. And I'm just trying to understand what the acceleration would be driven by. I assume it is -- part of it is the Corporate Bank, where you clearly have a target of 8% and you're talking about a slight increase and clearly reviewing the slides of the Corporate Bank, you talk about a lot of customer acquisition, but I'm just trying to maybe understand and rationalize this higher growth case better, if you could outline that post '26, assuming your base case of 3% roughly gets achieved for this year?

And then the second question is on the hedges. They've gone up in terms of contribution going forward, I think, EUR 200 million and EUR 100 million respectively, in the next 2 years? Just trying to understand what drives that? And if I may, just very briefly as well, if you could just talk about CRE U.S. briefly in terms of situation the way you see it for '26?

Kian, it's Raja. Let me just take the revenue questions first, and then James might contribute a little bit on the hedge question. Look, I think the '27 and '28 conviction is around basically the investments, one, that we're making. And two, we're going to see underlying growth start appearing its head when it is being masked today, especially in the Corporate Bank. So I think as you remember from our Investor Day, we have around an 8% conviction on the Corporate Bank. What you will expect to see once -- now that we are going to be over the FX headwind as well as the margin compression in the first half of the year, you can expect to see, and as I already mentioned, we had 5% net fee and commission income already in Corporate Bank last year. You can expect to see us exiting out of this year on Corporate Bank, perhaps not at the 8%, but mid-single digits to out that from a growth perspective. So that gives us the conviction that the future 5% that we have laid out is achievable.

The second thing, clearly, on IBCM, we have 2 things going on. One is a different macro environment for us versus where we were. Two, what we're doing on the business side from a strategy perspective and pivoting towards corporates versus sponsors. And three, we are actually making investments in 4 target sectors where historically, we have been a little bit underweight. And we have a lot of conviction that we actually now have the ability to capture more market share even in the U.S. given the back of what Christian has very clearly laid out the macro geopolitical volatilities and the client need for an adviser. So -- so if you were to put on an investment bank, and remember, the third thing that we, at this point, are being pretty in some ways, conservative around is assuming that FIC is going to stay flattish or will have some margin compression even. So we obviously don't know how -- what the macro situation would be. But that, to me, is a little bit of a wild card in terms of opportunities.

Where we are also obviously super excited about growth is in Wealth Management, because there, we're just getting started to be totally honest with you, I think we are on an early innings of getting our strategy right of attracting client assets, generating new net assets across our client base. So that growth is going to be a big contributor for our overall target. And finally, I would say Asset Management, as we just talked about, they have just recently increased their targets. So clearly, we have a little bit upside there that we were probably even 2 months ago, we would have asked the question whether it was there. So I think all in all, putting the Corporate Bank story on the side and working over the '25 dynamic, growing wealth management, increasing our market share in IB, I think that kind of gets us to the 5% and hopefully more in the future.

And before James comes to the next question, let me just add one point here, and that's the German impact. You have heard in November that EUR 2 billion out of EUR 5 billion we actually planned from Germany as an increase in revenues. Actually, the smallest part, low 3-digit million number is only in our plan for 2026. The real impact of that what is happening in Germany is in our revenue plan for '27-'28, because now you can see the stimulus impact on certain areas, defense starts, infrastructure starts, but the pullover, so to say, in the corporate -- broader corporate industry is coming, and we have that in our plan for '27-'28, again, in my view, the right approach.

Kian, on the hedges, the biggest impact is the gap, if you like, on the rollover benefit. So if you just assume a constant portfolio of hedges of swaps and you look at today's gap in -- that is in 26. So go to Page 25 of the analyst deck and look at the gap between the hedges that are rolling over and the 10-year swap rate. You can see that right now, that gap is about 2.5%. And if you go back to the same slide in last year's Q4 results, you can see that the gap was 1.9%. So that difference is a big driver.

Now obviously, volume of hedges will have an impact as well, which, over time, reflect growth in the portfolios that we're then hedging larger portfolios of deposits. And then the other thing, as we've talked about in prior calls has been whether there are any sort of overlay hedges that we do, that can also influence the hedge results. So for this year, it's a very strong benefit as much as EUR 500 million, and that's obviously a big help. It's influenced then beyond that by, as I say, deposit and loan growth that should also be a significantly supporting factor.

On CRE, I'm a little snakebit having sort of thought we'd seen a bottom in this market before and then seeing, if you like, more floors broken through. And so then the question for us is, will there be really a floor put under the market this year in 2026. And as we've talked about, particularly in the West Coast office submarket. Now at the risk of yet again sort of expecting an improvement and seeing another downturn, we do think we're in the tail of this cycle. And if you look at indices more broadly, they have been stable. But we're obviously subject to a potential downward revision of the appraisals. And so that's what causes us to be a little cautious at this point in time to fully call an end to the cycle in our portfolio, and we'll wait to see how and when the full normalization of that market takes place.

James, but you're assuming some kind of -- what are your assumptions for your provision guidance for the group on CRE values, as you just discussed for '26, I mean?

This is Raja. So let me just take the -- I guess overall provision guidance for the group. We do expect that on an overall basis, we will expect to continue to see downwards improvement in the CLP provision number. Now as James said, and I had said actually at the Investor Day, we do expect that we are not completely over the CRE hurdle. I think there's some tail -- small tail still left in 2026, which could be idiosyncratic. So on the whole, we expect improvement in CRE, gradual improvement in CRE. And the offsetting that potentially will be of normalization on Corporate Bank, which we actually saw very, very low defaults this year. So on the whole, trending downwards towards my target rate, CLP rate and also on CRE expecting improvement year-over-year.

The next question comes from Máté Nemes from UBS.

James also from my side, thank you for the dialogue, discussions and all your help in the past couple of years, and wish you all the best for the next stage of your career. As for the question, I just wanted to go back to the banking NII guidance of EUR 14 billion for 2026. It seems like a EUR 700 million step-up from 2025. And when I look at the Slide 25, the hedge rollover, that seems to indicate also roughly EUR 700 million positive year-on-year in 2026. So in that context, it seems like the over EUR 14 billion number doesn't have much in terms of benefit from either the growth in size of the hedge or loan growth, deposit growth and so on. Could you help me understand the moving parts here?

And the second question would be on your EUR 21 billion cost guidance. It seems like in some areas, perhaps you have pockets of opportunities that help you outperform the EUR 33 billion on the revenue side. If that is the case and perhaps FIC revenues also end up better than flat this year, is the EUR 21 billion number slightly flexible or that is a very hard cost target for '26?

Let me take the second question first. Look, the cost number can always remain flexible. Obviously, given that we have significant investments in there, but we have a lot of conviction around those. And what we have -- I mean, not me, but James and Christian have demonstrated that they have the ability to be pretty disciplined around costs. So look, I think if the FIC comes out much better than what we expect, I think that's actually a great tailwind to the bottom line for us because we can manage this organization pretty nimbly. So let's see. But at this point, our best estimate is to be a little bit over EUR 21 billion, assuming that all the investments get made in the calendarization that we have now laid it out to be and the revenues -- and the revenue mix more importantly, plays out the way we have thought.

So that's kind of our best view at this point. But that said, we are constantly looking for other opportunities to improve our cost base. And that work doesn't stop just when we commit to the plan. That work is going to continue to go on through the year. And if we see opportunities to take some of the productivity benefits that we actually have slated for '27 or '28 in X rate, then we'll certainly going to try to do that.

So on the NII guidance, you're absolutely right that the hedge rollover, which, by the way, I consider that as a component of how we manage the overall deposit book is actually a big beneficiary -- we are a big beneficiary for that and actually that's a very well-designed hedge program. Remember, I also talked about that we are making intentional decisions on the loan portfolios of exiting out certain portfolios where we are not SVA accretive, and that also goes for -- even including the net interest income. So there are some deliberate decisions that mute the underlying operating growth of NII along with the hedge rollover. But the expectation is that as that calibration of the exiting portfolios tapers off, then you will not only have the benefits from the hedge rollover in the outer years, but you also will have a real bottom line increase in the NII from both loans and deposits.

Just one other thing to add is in 2026, you're going to have, if you like, a grow-over effect for both FX and the margin compression that took place through the year. So there's some other dynamics in the numbers that are harder to pick out.

And the next question comes from Stefan Stalmann from Autonomous.

James, thank you very much for everything and all the best going forward. I have 2 questions on asset quality, please. The first one on the U.S. CRE book. It does look as if you actually exited about EUR 2 billion of office exposure during the quarter. And at the same time, the average LTV on the office book in the U.S. went up quite a bit during the quarter. Can you maybe add a little bit of color on what happened? Do you actually sell NPLs? Was there a general mark up or mark down of collateral? Any color there would be useful.

And the second question, there was a media article maybe a few weeks ago about your intention to hedge your data center lending exposure. And I don't recall whether you actually commented on that already or not. But if you can to the degree you can, could you give us maybe a bit of a sense of how big this book actually is and whether it actually overlaps with your U.S. CRE book or whether that's considered a corporate exposure mostly in your perspective?

Thanks, Stefan. And to you and all the others, thank you for your very kind words and the partnership. On CRE, we noticed that as well, and it's really mostly payoffs of loans that took place. And the effect, especially of payoffs with low LTVs has been to increase the average LTV of the remaining book. There were some -- the closings of some of the sale transactions that we first sort of announced in the third quarter and executed in the third and fourth quarter. So some of it was loan sales. Some of it were pay downs and the net effect on the LTVs was to increase them.

On the data centers, we didn't make a public statement about that. It did become public, and there's truth to it. But the truth -- the wider truth is, we've been a very strong participant in this marketplace for several years. We're very proud of the franchise that was built here, but we've always operated that business under, as you'd expect, risk appetite sort of parameters for our overall exposure, both on the book and in new originations.

And as you'd expect that given those parameters, we -- as we do for -- in a sense, all other financing types here, we manage those exposures carefully, especially in an underwriting period. And so that, I would just characterize as ordinary course risk management. Remember that the hyperscalers, what we do in that book is obviously seek out the highest quality loans to underwrite. And the feature is an interesting one, which is that the stronger the contract with the ultimate offtake provider, the more highly rated the underlying position is. We lend mostly to investment-grade tenants or indirectly, if you like. And so we feel very good about the strength of the portfolio, but nevertheless, manage it carefully.

As to the CRE, I believe the -- if you like, direct CRE exposures -- data center exposures are treated as CRE in the same way that warehouse distribution and hotels are commercial real estate. And so it does, I believe, add to the total balances.

And the next question comes from Joseph Dickerson from Jefferies.

Most of my questions have been asked. But I guess, as you look out in your ability to deliver on your targets for 2028, the market didn't believe you on what you've achieved on this plan through 2025. And if I look out at 2028, it looks like expectations are sitting at least 100, if not 150 basis points below your RoTE target. I guess what do you think that the Street is missing in that regard about your ability to deliver the RoTE that you've outlined?

Look, let me start, and my 2 CFOs may want to add the luxury this quarter still. To be honest, I think it's execution and evidence. And if we deliver again on the next step in 2026, and we committed to a gradual improvement year-over-year, we actually told the Street that we will invest a bit more in 2026 in order to capture all the opportunities. I'm absolutely sure that also the Street will move its consensus.

And to be honest, if I see actually the gap between consensus 3 years ago to the 10% and where we are now with the gap to consensus to 2028, I think there is a huge amount of credibility we have already gained. It's on us to show that quarter by quarter, year by year. And we will lose nothing of the dedication and discipline we put into this company going forward. So it's actually nice to, so to say, race and beat all the time.

Thanks, Christian, if I may just to add. I think, obviously, the company went through a transformation internally and now that transformation has been visible to externals. I think at the same time, I think the pivot that we have from now defense to offense, while we have all internally bought off on it and understand what we are doing, that is -- there's obviously going to be a natural lag for people to get a full understanding of how we will get there. And I think that's completely understandable.

So it is our job, I think from my perspective, there, we have 2 jobs. One is to deliver on what we said we will deliver on '26. But more importantly, we want to show you the underlying drivers of what is leading us up to '28 in terms of the KPIs that we shared at the Investor Day. So even if the underlying financial output of that is on a lag, we want to be able to show to you what we are actually doing on the cash side, what net new assets we're boarding, how many advisers we were able to bring in, how our volumes are increasing. So I think my hope and my expectation is that once we start delivering quarter-by-quarter in '26, show the discipline on expenses, and then start sharing the underlying drivers of where we are succeeding that gap will hopefully narrow and maybe we'll end up at a stage where we are being -- we are behind the other way around.

The next question comes from Jeremy Sigee from BNP Paribas.

And thanks and wishes to James from me as well. A couple of follow-ups. One on the NII discussion and the sort of the limited progression to the EUR 14 billion. You mentioned loan portfolio exits. You also talked earlier about negative margin impact. Are they largely done now? Or is there a bit more of the negative margin impact still to come through in '26? That's my first question.

And then secondly, just a very broad question for Christian perhaps. You touched a couple of times on the German stimulus and deregulation programs. I just wondered if you could give some further perspectives on those, particularly from your conversations with corporate clients and the extent to which they're moving from kind of just thinking about it to actually doing something and preparing concrete plans for investment and borrowing and all that kind of good stuff?

Sure. Let me take the first question. Look, we had said out at the Investor Day that we -- it was our intention to move our SVA from 40% to 70%. Now obviously, that was on the business level. As you saw this quarter, each of our businesses on an RoTE basis was in excess of 10%. So at a portfolio level, we are obviously in a pretty good situation, but there are certainly pockets of activity inside our businesses or in geographies, which we either need to improve the SVA on or through their expenses, through better capital allocation or better pricing or we decide need to downside -- to downsize to create capacity for lending that makes sense. So that work will continue to go on over the next 2 or 3 years. But obviously, this '26 is a start for that. So it's a little bit more transparent.

On the margin headwinds, we expect that we will probably -- they will subsist for the first half of the year, as James said, but we think that we will most likely grow over them in the second half of the year, especially, it will become a little bit more prominent in corporate bank where they have been the most impacted by the margin.

[Operator Instructions]

Sorry. Sorry, I was on mute. I just wanted to take the second question, and that is on the German stimulus. We see actually in the fourth quarter and now in the start of the year, the impact of the stimulus in particular, so to say, in 2 asset classes, defense and infrastructure financing. As I said before, we can see quite a good momentum, in particular on the defense side, also with mid-cap companies because in Germany and in Europe, it's actually the case that it's not the big defense companies who actually need lending. It's actually the mid-cap companies supporting these large-cap companies. And there, we're working not only by ourselves, but with banks like KFW, you have seen our announcement with EIB actually on a joint program where things are really developing.

And I do believe from all that I can see in Germany, but also in Europe that actually the activity is slowly starting. And hence, from a planning point of view, I outlined that before, we firmly stick to our EUR 2 billion of revenue increase out of the EUR 5 billion coming from Germany. But I think for the right reasons, we have put most of that actually into the years '27 and '28 because it needs preparation.

In this regard, although it sounds sometimes differently in the media, the government is doing everything they can in order to focus on competitiveness and growth. We have seen a couple of reforms. And of course, we all wish for even quicker implementation. But I also have to say that on the European level, things are moving. And therefore, I gave you the example of regulation, how the talk is there. But also the extra summit, which will take place in 2 weeks' time, which actually at the request of Germany that we need more reforms in Europe on bureaucracy, less regulation, Capital Markets union, digital investments. It all shows that something is happening.

And that brings me to the last point where we obviously benefit. We should not only think when we talk about stimulus in Germany and hopefully also growth in Europe. The biggest theme in Davos last week, next to all the geopolitical discussions was actually the investors talking about redistributing their assets. And they are doing it for 2 reasons, and the beneficial is Europe for diversification, but also because they see Alpha in Europe and they see Alpha in Germany. And that's what we also see in the Made-for-Germany initiative. So therefore, I remain positive personally. Of course, I also want to have things always quicker, but I can clearly see that things are picking up.

[Operator Instructions] The next question comes from Andrew Coombs from Citi.

Firstly, just all the best James. On the questions, same theme I'm afraid, but I wanted to touch upon margin in both the Personal Bank and the Corporate Bank. Obviously, you have fantastic deposit growth. It hasn't shown through in the net interest income thus far. And I know the comments that you've made on the trajectory for this year. But on the PB side of things, can I just ask what you're seeing in terms of deposit competition and any commentary you can make around household deposit meters, where they stand today, where you think they're going to trend to?

And on the Corporate Bank side, you've talked a lot about the first half of this year, still having an impact from lower rates in FX, but how you plan or think you'll exit that in the second half, but can I just clarify how much of your deposit book in the Corporate Bank is dollar-denominated rather than euros? And what's the consequence of lower Fed rates on the margin there?

Let me start with the PB. As I mentioned earlier on, we're certainly seeing some competitors coming in with teaser rates in January for -- through all the markets for new and fresh money, a couple of outsiders in there as well. We also have some campaigns running. So at this point, from a growth strategy perspective, we don't see an impact of us basically losing out on these deposits in the short term.

As I mentioned, we've done that pretty successfully in the previous year. But there's certainly some pressure, which I think there was an NII question earlier about as well as to why they were not -- why the hedge was the predominant contributor. Part of it was loan exits, but part of it also was some deposit compression.

On the CB side, at this point, we are not seeing the deposit pricing trends change, but we do have the year-over-year headwind that I talked about earlier that I think is going to persist at least to the first half of the year before we start exiting out of it and start seeing sequential growth. That's kind of what we're seeing on CB. In terms of the deposit mix between U.S. and Europe, I'll may have to get back to you on that one from Ioana. But obviously, we have a pretty global franchise, and we raised deposits -- institutional deposits across the world, but I will have to get back to you on the precise mix.

So it looks like there are no further questions at this time. So I would like to turn the conference back over to Ioana Patriniche for any closing remarks.

Thank you for joining us and for your questions. For any follow-ups, please come through to the Investor Relations team, and we look forward to speaking to you at our first quarter call.

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

Great. Thank you very much. We're here with Christian. Christian, it's great to have you. You just had your investor update on Monday. So I suggest you have a look at the slides, a lot of details around the business outlook and the guidance and targets. And we want to unpack that a little bit today.

And I remember last year, Christian, we were here, and we were discussing can Deutsche make 10% RoTE in 2025, which is your target for this year. And there was a lot of skepticism still at that time. Clearly, that skepticism has been cleared up. And now we have a new RoTE target of 13% plus by 2028. And really, it would be great to hear how the strategy has evolved, the scaling up of the Global Hausbank strategy. And how you see this 13% RoTE target, which is a medium-term target? And how should we think about Deutsche Bank long-term targets?

Well, thank you, Kian, and welcome, everybody. Always great to be in this, I have to say, one of the nicest halls I know in London. So nice environment. .

Look, I'm really pleased with the overall development of the bank, and everything what we presented on Monday is a part of a really long-term journey for Deutsche Bank. And I knew that when I took over in 2018, also when we had our first restructuring then in 2019, I knew that after the first 2 or 3 years, we can really start building the future of Deutsche Bank. And we did this in 2022 when we called our strategy to become the Global Hausbank. And we have made step by step over the last 3 years to get there. You just mentioned the 10%. I think we are very much on track to achieve that with all the numbers which we have shown to the market. And now it's the next evolution in the strategy.

But what is very important to understand, and that was key for the management when we were sitting together since May and preparing the Investor Day for Monday. It is clear that we have a far longer story beyond 2028. And therefore, it's an evolution of this Global Hausbank strategy. Now we are calling it scaling in the Global Hausbank, because our clients, the overall environment really view us as their Global Hausbank and now we can build on it. But 13% or larger 13% in 2028 is another milestone only. It will go beyond that. But I do believe we need to stay credible. And therefore, we are doing it step by step.

What makes me most confident about this plan is, to be honest, Kian, that we, starting in the management board, have fixed the core, and now we can focus on that what others have done already and that is growth, day-by-day efficiencies and applying a different type of discipline and management of the capital. These 3 levers on its own, totally in our hands, will bring us to the above 13%. And from that, honestly, we want to march on.

And unpacking a little bit more the targets. As you mentioned, 13% RoTE by 2028. The medium target below 60% cost-to-income target or guidance. And are these the right numbers in your view in terms of the mix of the group, the way the group is positioned? And tell us about how you get there? You clearly have additional targets around these group targets. How do you actually get to these numbers?

Yes. So first of all, it's different than 6 years ago because, to be honest, when I presented in 2019, the strategy also in London, to be very honest, these were top-down numbers. I said this is the minimum we need to achieve. All that what we presented on Monday is bottom-up. We have detailed, detailed business plans for each number which we presented to 2028. I have the biggest confidence in delivering on the growth side, on the cost side and on the capital side because I can see that for each sub-businesses, it's not only assumptions, we have the underlying plans.

What we wanted to show in the environment where we are is a credible plan, but a plan where we beat and raise. That's for me most important. And I wanted to have a plan where year-by-year, we are showing improvements. We know that there are lots of opportunities for us, and we want to grab them. Whether it's opportunities in Germany, whether it's opportunities in Asia Pacific, we want to invest into them. But we also said, and this was one thing for Raja, our new CFO, who came in and said, "I want to see improvement year-over-year." And we have planned that in a way that I think it's not only credible, but we have detailed assumptions for all of that.

And I do believe that actually it's rather a prudent plan because of a lot of upside which we actually see, not only in the home market, but also in other business and areas that are not part of the plan. And therefore, I'm so confident that we'll achieve the larger 13%, but also that there is room for further growth actually beyond 2028. So again, it's based on a very focused growth story. We know exactly where we have opportunities to grow, where we don't have yet the market share, which we should have. It is now, while having fixed the core also on the regulatory remediation side, that we can put all the focus actually on spending money in the operational efficiencies, and last but not least, making sure that every day when we deploy capital, we make sure that our hurdle rates are met.

And clearly, one part of this improving RoTE and this new scaling up Global Hausbank strategy is growth. You have a hurdle rate, which we estimated 13%, and you generate 40% of your business at this hurdle rate. You want to scale it up to 70% and take more share in that. Can you discuss the growth areas where you see opportunities and where you're focusing on to scale up to the 70%?

Yes. It's a mix. Exactly right. I mean, we call it, at the end of the day, the SVA methodology. And also as a result, if you look at SVA, all 3 items or all 3 levers I'm talking about are positively paying into SVA growing, taking costs out and obviously allocating the capital in a smarter and more disciplined way. Now when we think about growth, I do believe that we, in particular, have a better chance in the asset gathering business, whether it's in the Private Bank, in the Asset Management, but also in parts of the Corporate Bank.

We have a tendency that we were very much focused in the Private Bank on the lending part, mortgage business, partially consumer finance. If you really see the environment in Europe, in particular, in our home country, the biggest focus for the next 10 years is actually on the pension and investment business. And that was the reason why I asked Claudio almost 3 years ago to come actually to the Board of Deutsche Bank, because he has an investment background. And I do believe that the biggest chance where we can actually grow in the Private Bank is in this asset-light business and in making sure that our 18 million clients in Germany, outside the Wealth Management line, so 18 million retail clients have access to the best investment products.

83% of the Germans, it's our most recent survey, are clearly saying that they don't believe that the state pension on itself will be sufficient for their age. They need actually a private pension. The chance for Deutsche Bank with the product delivery we have in Wealth Management, Asset Management and in the IB for these 80 million clients is fantastic. For the first time, we have the chance to serve these 80 million clients with one platform. Postbank clients in Deutsche Bank, 14 million clients didn't have access to investment products in the past. Now they have. And if you think about what the most urgent need for these clients is, it's investment. So just there, we have an unbelievable chance to grow, and obviously, it is capital-light.

Corporate Bank, the next one. In Corporate Bank, if you really think about what is happening, it's very much about cash management, payments services. When you think about where we invested over the last 3 years was exactly in those areas. We fixed, again, on the regulatory side a lot, where do we want to grow, in cash management on the corporate side and on the institutional management side. We actually didn't grow on the institutional cash management for the last 5 years because we fixed the core. Now we can do it. We have invested into programs like we come out now in 2026 with the Miles & More program with Lufthansa. It's a 10-year contract. It's 10-year annuity streams.

Now other corporates in Germany, seeing that we can offer this platform, they are asking us whether we can work together. So again, asset-light, and in this regard, we are obviously then taking down a little bit those products where from an SVA point of view, and that is the reason why we are only at 40% in the past, we have not delivered the returns. And again, Claudio started this year. We reduced mortgages in Germany, increasing the SVA. So therefore, it's a focused growth story on areas where we know we can take market share and the environment is positive for that. And at the same time, a smarter allocation of capital.

Yes, you can see it very nicely in the German bank already where you're not growing risk-weighted assets and your returns are constantly improving as you're increasing the fee side, yes.

And last year, when I was here, you asked me, and actually, you challenged me for years, whether we will be ever able to show a return on equity in the overall Private Bank of larger 10%. And I told you the mid-teens digits will be there. Our target is larger 18%, and we are now already above 10%. So above 10% is obviously not sufficient, but you see the turnaround because we started to do it right.

And we should maybe talk about Germany a bit more. As you have a EUR 5 billion revenue growth target between '25 and '28, you mentioned EUR 2 billion of that is Germany related. And clearly, how much should we think about the German stimulus as a driver of the revenue guidance?

Look, the Germany story is twofold. And to immediately answer your question, our Deutsche Bank research believes that Germany will grow next year with the stimulus and the changes by the government by approximately 1.5%. We didn't take that. Our assumption is actually that the GDP growth in Germany for the plan, the assumption for the plan is 1.2%, where I think, you know what, it's the right number. I think there is a good chance that we see a higher number, and that would be upside to the plan.

But coming back to your question, the first thing what we need to do better in Germany has nothing to do with any changes on the political side, on the economic side. We simply need to harvest our home market better. Are we, in most of the segments, the #1? Yes. But I'm disappointed with kind of the quality of the #1. We can be better. And I give you one example, and therefore, Fabrizio made the changes also in the leadership in the Corporate Bank, moving them to Germany.

We have a cross-sell ratio with the top 250 German clients, corporate clients, DAX companies, MDAX companies, up to the larger 50 of approximately 5x, 6x. You know Germany quite well. Then you come to the clients where they are as international as Siemens or Mercedes, but they are family-owned, they are mid-cap, hidden champions, but all in a revenue environment between EUR 1 billion and EUR 5 billion, but not listed. Our cross-sell ratio is unfortunately south of 5x. Why? Because we haven't covered that segment in the way we have covered the large ones. And therefore, we said we can be better there. What we can do for the large ones, we can do actually for that segment.

And that is the reason why I wanted to send the clear signal, irrespective of what is happening on the political side, we can do better in Germany. And therefore, you see that of the EUR 2 billion you are quoting, more than 50% has nothing to do with the stimulus program. It's simply the way that we are better exploiting our clients in Germany and that we are doing more business, and we can do this. And the external environment in this regard, Kian, is helping us, because the clients in each and every meeting I have with the wealth management client and in particular, with the CEO of a corporate client, be it a family-owned or a listed company, one of the top 3 questions is risk management. And what they need is an international bank with a big network and investment banking products so that I can risk manage their risks. And therefore, we have a real chance with the existing clients to do more. That's number one.

Number two is, of course, that we want to benefit from the stimulus program and what is happening there. And I can tell you, in particular, in the areas of defense and infrastructure, we are seeing it actually very much. And in those areas where we can't do something directly because at the end of the day, it's potentially above our risk appetite, there we are working with institutions like KfW in order to channel the money which is coming from the state, leverage it with guarantees, with first loss pieces, with other investors. And there, to be honest, we are, in my view, like a spider in the net, because we have worked with KfW through COVID for decades actually. And now we have the chance to leverage the stimulus program. So it's actually 2 items, yes, all the changes we see in Germany, but in particular, working on ourselves with new processes, a different coverage system to exploit that market better.

And I mean, you mentioned penetration. I mean, it really feels like you're moving to a different level of, as you say, upscale, the Global Hausbank, the penetration of the client base. Can you just talk a little bit what has, in that case, changed? Is it also technology that you have a better understanding of the client demand? Is it you're more comfortable on the capital side? Is it just the perception of the bank has changed or products? What -- or is it all of these things together, just to understand for the audience also what is this kind of uptick of SVA penetration? Because you were at 20%, I think, in '21. Where are you in '25?

I think we were even below 20% in '21. Look, it's all of that. And to be very honest, if you are in a situation like we were in 2019 and 2020, where you fight your legacy assets, where you have a lot of litigation out there, when you have legal issues, regulatory remediation, to be honest, the focus of the management on the best capital allocation does not get the top priority. It is what it is. And of course, in a situation where you got 7 rating upgrades from rating agencies over the last 5 years, your perception with clients is a much better one than before.

And therefore, reputation, in particular for a bank, we are a people's business, we don't have an asset like a car company, reputation and trust is our key cornerstone, and we regained it. And that is the reason why we see this momentum. And if you have this momentum from the outside, you know, Kian, what is happening? I've been 36 years with Deutsche Bank. When I came in 1989 to Deutsche Bank, every person in this bank was proud to work for Deutsche Bank. We lost that. We lost that in the years after the financial crisis. Now we regained it.

If you see in our people survey from 2018 to 2025, the ratio of being proud again for Deutsche Bank, it goes like our profitability. And we can still go higher. But if you have this feel again, this dedication of the people, the passion of the people, then this is another factor why it's going better.

Thirdly, the environment out there is net-net beneficiary for us, because what is happening around the world is that the people are uncertain. We have a volatile situation. And that means that, again, an expertise and offering about actively risk management, our clients, giving advice, super important, whether you talk private, corporate or institutional clients.

And then there is the third thing, and we should never forget that. In this situation, where the geopolitical situation is like it is, and in my view, it will not change, the call for a European alternative is bigger and bigger. The mandates we received over the last 12 months, of course, we had to do a good pitch, but also for the reason that they said, "we like the U.S. banks, they are fantastic, but we want to have, for that decision, a European alternative at the table" is unbelievable. And that is our chance. And then look at Europe, how many Global Hausbanks out of Europe you have left with the offering we have and with the network. And all this together, with the focus of the management now kind of freed up from the past and focusing on growth and on the active management of the bank, that is the reason why we have such a momentum, and it will not stop.

And it's good to see your -- based on our numbers, the #1, 5 fixed income house in the world. The biggest in Europe, therefore...

While we're fighting with you always.

In Europe, yes, you do. So you're really the top player in Europe clearly. And globally #5 based on our numbers. You're Euroclear #1. So despite those concerns, you kept the key market shares.

Because we focused on that. And therefore, I think a lot of decisions, and I'm sure I've also done mistakes, but a lot of decisions we took since 2018 were the right ones. Remember 2019, when we said, Deutsche Bank is a global debt powerhouse. Let's focus on the FIC business. People were not sure whether it works. Because of that focus, because we rooted the investments into that, the job Ram Nayak has done to reposition us as the #1 in Europe, to make sure we are #3 in Asia. For the time being, we are #7 in the U.S. We will become #5 in the U.S. in the FIC business with all the focus we are putting on this. Focus was always the most important, and we did this on our strength. And now in the next phase of the strategy, we focus on the items I just mentioned, asset gathering, corporate bank, and I tell you, we will see the same result.

Moving to scaling the operational model has been a big thematic. What does it actually mean in practice? And in that context, one question that I've asked you a lot in the past in the conference calls is about cost flexibility, because you have a cost-to-income guidance of below 60% now by '28, then the revenue picture changes, which is clearly also important from a multiple perspective.

Well, it means operational efficiencies or operating efficiencies means actually, in my view, 2 things. Number one, the investments we are doing over the next 3 years plus, so to say, extra investments next year, where we got a lot of questions on Monday, are all hinting at 2 items. Number one, making the client experience better and really taking cost out of the front-to-back processes in the bank. If you now look where our investments are going, 70% to 80% is going into business growth and operating efficiency. If you look back 3 or 4 years ago or 2 years ago, half, if not more than half, into regulatory remediation. So we can now direct the investments into everything which makes us leaner or where the client is getting a better experience.

So if I'm talking about growing my assets and doing investment business for 80 million retail clients, your question must be immediately, well, Christian, you can't do that via branches in Germany, because you can't cover a normal retail client one-to-one. Therefore, Claudio is getting the investments to actually establish a digital investment platform for 80 million clients, and we will be there.

If you think about the next one, I told you that I want to exploit better my clients and do more business in Germany. Well, we need to redesign the credit process for German mid-caps. A lot of investments is going into an AI dominated credit process without changing the risk appetite for mid-caps. The time from origination to approval will be reduced in a significant way. So everything what we are now doing is actually either improving the client experience or reducing cost or actually doing both. And that is where we invest.

Now to your question, of course, we can stop that. And therefore, look, we have EUR 2 billion in cash terms. We have EUR 2 billion of CTB investments every year. We have some extra investments next year. And if we need, we can stop it. It's not that I'm saying, I'm locked in for the next 2 or 3 years. But to be honest, with the momentum we see, I don't think that I need to be in that position. But theoretically, I could do it. And the nice thing is, which, again, and thanks to Raja and the way we have planned it, I'm not allowing a year where we are not making progress. 2026, despite the investments, will be the next year of progress in terms of RoTE. That's key for us.

Yes. Maybe just to detail that out a little bit, because I think there has been some questions post the Investor Day, are the returns -- basically, is the cost upfront and the returns later, i.e., is it more of a hockey stick trajectory? And in that context, can you just outline a little bit how you think about the progression of investments, and will we still look at 10% plus RoTE in 2026 for the group as well despite the investments that are coming?

As I said, it will be an improvement year-over-year, as we are very confident that we are above 10% in 2025. You have the answer for 2026. But we also said, look, we have now an opportunity, whether it's in Germany, whether it's in certain parts of asset gathering, whether it's in the advisory scheme, in the capital markets business, to grab business, and therefore, we want to invest. But despite the investments, clear [indiscernible] management team to improve returns year-over-year, and then even more improve it in the years '27 and '28, but it will be a year-over-year improvement, yes.

And you clearly have given a cost guidance as well for '28, yes.

For '28, we have given the cost guidance, and we have gross efficiencies of EUR 2 billion. I think we've earned the credibility. We had -- up to 2 years ago, we gave ourselves EUR 2 billion of gross efficiencies for 2025. We saw that we are better. We upgraded it to EUR 2.5 billion. We will meet the EUR 2.5 billion. Now we again gave EUR 2 billion. And you know me a bit well. So obviously, internally, I'll ask for more, right? It's beat and raise.

Maybe changing gears and looking at capital discipline. Clearly, we talked about SVA. We talked about growth. And one key area is also improving revenues to risk-weighted assets by 100 basis points by '28. Please talk to us about what areas, where do you see the opportunities to achieve that?

Yes. Look, first of all, I think we need to -- and this is really a little bit also education. We haven't run the bank in the last 6 years based on the SVA model. And therefore, we started at the beginning of the year, with the fourth quarter results in January, I talked about Deutsche Bank 3.0. And for the first time, I mentioned the word SVA. We started to, so to say, informally introduce it this year, got the transparency that finance gives to the people, the transparency how is their portfolio looking based on SVA. And hence, we have built the platform to do this now. So there is a far different attention in the bank for SVA. Everybody now understands how we are driving it, and compensation will be linked to it, because otherwise, I wouldn't be consequent.

Second, there are a lot of pieces in Deutsche Bank where our SVA is very positive already. But we have some areas in the sub-portfolios and kind of in each and every business, except Asset Management, where we are in parts SVA negative. Now I gave you the example of mortgages. And therefore, we took a conscious decision to say, look, let's reduce mortgages in the white label area for DSL. We simply stopped it. We are not originating anymore. Could we have done it 4 or 5 years ago with the reputation we had at that point in time in our home country? No. Now we can do it. And we didn't even lose clients because of that.

Now the next one is in the Corporate Bank. We have a wonderful Corporate Bank, but we are too heavy compared to our cash business in the trade finance business. And if you compare, again, Deutsche Bank with JPMorgan, if you compare the weightings, the ratio, how big we are in trade finance versus cash, you have a better ratio. And we want to change that. We want to, over time, change the ratio of how exposed are we to trade finance with the clients versus cash, and we are having the discussions.

The third one is pricing. Pricing is an issue, Kian, which we could not raise in the situation we were 3 years ago with our clients. Now we can do it. Now we are doing it obviously in a way that you are doing it step by step, but the clients have an understanding, and I said it exactly like that in my prepared remarks on Monday that we need to deploy our capital commercially. Now if you have the transparency for each and every relationship manager that he can see the SVA contribution of his client, then he also knows far better what he needs to change. And that's what we are doing.

So mortgages in Germany, trade finance in the Corporate Bank, some areas in the FIC financing, where I think we can even do better. And then there are potentially certain sub-businesses on the edges where at the end of the day, we might exit it completely. Now we are not talking openly about those, obviously. But if I don't think that we can turn something sustainably around, then there are no limits, and we will do this. Last but not least, as a result of that, PB, CB and the Investment Bank, all 3, each will increase SVA by EUR 1 billion by 2028.

Yes, around EUR 3 billion. And you have a model now where you can see a client view, I assume, where you can see exactly what does the client generate across the different...

Exactly. And you need this management tool. And again, you can criticize us for that. We didn't have that in the past. Now we have it. But even when you have it, you first need to do the education of your people. They need to understand the concept. We have all done that. Now we can apply it.

So it's an optimization of it forward?

Yes.

Now looking at your capital levels, capital ratio of 14% plus, please talk to us about payout, which is 60% target. How should we think about the mix and progression of that?

Yes. First of all, we wanted to send a signal that also with the healing of the bank, with the transformation being done, I'm always going we are now a normal bank, that obviously, we also want to put the shareholder, so to say, more into the focus and also really appreciate that what our loyal shareholders have done with us. And therefore, we said, look, we earn more money. There is a rising profitability, and we want to actually give back more to our shareholders.

Now how does it work? A higher payout ratio, 60%. Now from a -- how is it comprised? Raja said it, and I think it's right, we have seen, over the last 3 years, an increase of our dividends on an annual basis by 50%. I think we will further see increases in dividends, but not potentially with another 50%, but we will actually balance that with higher buybacks. So clearly, more distribution to our shareholders, but a different mix between dividends and buybacks. Dividends will increase, but most likely not after next year, because we still plan to go for another 50% increase for the dividends paid in May for 2025. After that, not such a steep increase, of course, an increase, but more via buybacks.

And you just said it, our guidance is 13.5% to 14%. We do believe that actually with all I see that there is a good path to be sustainably above 14% on top of the 60% payout ratio. Obviously, if we are sustainably above 14%, there is excess capital to be distributed.

Really, it's been a quite impressive journey from where, as you said, I remember going to the U.S., marketing and all I talked about counterparty risk of Deutsche Bank to a lot of hedge funds, to 10% RoTE, which we discussed last year, to now discussing 13% and above, and everything seems to come quite nicely together with a nice German stimulus on the back as a tailwind. Fourth quarter, we've talked a lot about strategy, but we should touch on fourth quarter. How should we look ahead of the fourth quarter, but also look ahead for next year?

Positive. Look, one thing is clear, the fourth quarter is always, compared to the first 3 quarters, a bit weaker. I don't know what is happening after Thanksgiving. And therefore, we are prudent. But we see a very nice run in Asset Management, Private Bank, Corporate Bank, very stable to that numbers and I think even a little bit better, in particular, in Asset Management in the fourth quarter, but otherwise to the numbers we have seen before. As I said on the earnings call, we had a really nice October. So I think it all gives us the confidence that we deliver the larger 10%. And therefore, it gives us the operating momentum that we continue into 2026.

And as I said, we want to have a 2026 which is better than 2025. Hence, there is no pause. There is no transition year. Yes, we will invest a bit more, but with a clear aim also to start delivering more. And therefore, the fourth quarter is actually, with all its uniqueness, like you always have in the fourth quarter, but it's a quarter which will bring us and show at the end of the year that we are above the 10% RoTE.

So another confirmation of the momentum in the bank. With that, I think we'll open up for questions. It's been so far quite a shy audience, I have to say. There's one. Yes.

A quick question on stablecoins. How do you see the competitive environment when it comes to mobility of capital impacting the balance sheet and obviously the profitability of banks in general? And I guess, extended how high is that on your priority list, if at all?

It is on my list. It's not the #1 priority, but it's clearly a priority topic. And to be honest, if you see the activities we have in the Corporate Bank, which we have in Asset Management in DWS, you can see that in certain areas, we are even a leader in Europe. You may have also seen the announcement that we are working together with some European and U.S. banks on a stablecoin initiative. So clearly, I think if we miss that boat, then we may have a competitive issue. And therefore, we want to position us at the forefront of this.

And maybe to add, we have been doing a lot of researches comparing the different European players. And I think also with your background as #1 in Euroclear, you are actually coming up, in our research at least, quite advanced relative to most of your European peers. A few out there which are keeping up with you, but I have to say, Europe is generally behind the U.S., but you're really keeping up in terms of most of the projects which are well advanced on your side relative to both tokenized deposits, et cetera.

Exactly. So a lot of credit to Fabrizio and Stefan Hoops, who have both actually invested a lot of time in that. I'm speaking to my colleagues of the European banks. And as you're saying, we have -- with 3, 4 other banks, we are really pushing this. And I think we must be, in particular, because of our #1 status in Europe on the clearing side, we must be on top of that.

Yes. Any more questions? I have lots to go. There's one.

Just with the sort of application of technology to your cost base. Why shouldn't you deliver much more cost savings rather than -- on a 5- to 10-year view?

Oh, yes, I never said that I'm not delivering more, and I never said that 60% is the end game. I tried to say my first answer, we are on a journey. And to be honest, look, I'm super confident that we achieve a larger 13%, below 60% cost-to-income ratio by 2028. And again, it's a milestone in a journey, and therefore, we must go further down. But technology is a great example. We had, I don't know, how many discussions on application of AI. And 2 comments on that. Number one, again, Raja and James told us, look, let's go prudent with the assumptions. But if I just think about how we apply cost savings in the application of AI when it comes to coding, then there are competitors out who think this will save -- in terms of coding cost, this will save 30%, 40% or 50% over the next 3 or 4 years. We apply 20%, because I want to beat and raise.

And therefore, I gave you the example that without even AI, over the last 3 years, we came up with a EUR 2 billion efficiency, we delivered EUR 2.5 billion. And that is the way I want to convince the market. I think on AI, so I really do believe this is part of the upside, which we introduced to you on Monday that I think 13% or larger 13% is the floor. One of the upsides is AI. And therefore, I'm so optimistic that we are better. But there is more to it. It's not only AI in itself. The most important on AI, and that's what we are daily discussing with our managers is actually the leadership on AI.

Because I get a lot of use cases, great use cases and saying, look, with AI, I can do that and that and that. You need to do the consequence management thereafter. And therefore, we decided, for instance, in research, David Folkerts-Landau said, with AI, I can actually cover up to 50% more corporates in terms of research than before. And I told him, either you agree with Fabrizio that we are doing it, it's good for our client relationship, or we need to discuss something else. And that translation of AI into management leadership is for me the most important. I will not be the most sophisticated one in order to change the coding of Deutsche Bank. I'm not a tech. But it's my job to make sure that AI is combined with leadership. If we do this, to be honest, way more than 20% than what we have in our plan.

And Christian, lastly, we have talked a lot about bottom-up execution, improvement of penetration of your client base. So it's a very much bottom-up driven strategy. Where do we stand on inorganic growth from your perspective in terms of either add-ons or anything else?

Look, I'm of the conviction, if you have, like we, the key levers in your hand, in our own hand organically to grow to above 13% over the next 3 years, that gets our full priority. Now if there is a unique opportunity in businesses where I think it's easier to do M&A, but really unique issues like Wealth Management, Asset Management, we potentially would look at it. But M&A, also per Raja's presentation on Monday, if you look at the ranking, has the lowest ranking, because we believe it's in our hand. And if I can drive something organically, I always prefer that.

It's been a pleasure, Christian. We hope to have you here next year again to see the progress and a strategy which is really a major shift from the discussions we had last year and even especially the years before. Thank you.

Thank you.

[Operator Instructions] Please welcome Head of Investor Relations, Ioana Patriniche.

Good afternoon, everyone. I'm Ioana Patriniche, Head of Investor Relations. I'm pleased to welcome you today to Deutsche Bank's 2025 Investor Deep Dive. You'll shortly hear from our Chief Executive Officer, Christian Sewing, and other management team members, who will give you an update on Deutsche Bank's progress, forward-looking strategy and financial trajectory for the group and its businesses. But before we get going, let me briefly talk you through some housekeeping items.

The presentations are now available on our Investor Relations website. You can access these by scanning the QR code on your passes, which also have the WiFi details. And these are also displayed behind me. We will upload respective speaker notes after each individual presentation has finished. We've made a few visual adjustments of the slides for the screen. So if you're asked the details in the footnotes, please refer to the uploaded materials.

We will have a short break of about 20 minutes at 2:50 p.m. Thereafter, the final set of presentations will resume, and we will finish with a question-and-answer session for those in the room and joining us virtually. The Q&A will begin at around 4:20 p.m., and I will give you more details on that at a later point. And for those that listen to the very beginning of our quarterly calls on a regular basis, you'll know I also need to remind you that every presentation contains forward-looking statements, which may not develop as we would currently expect. But with that done, let's start our event.

[Presentation]

Please welcome Chief Executive Officer, Christian Sewing.

Welcome, everyone, to 21 Moorfields. My colleagues and I are delighted to see you at our London headquarters. Thank you for joining us today for our Investor Deep Dive. Today is a very special milestone for us. We are going to discuss with you our way forward for the next three years, where we are going, how we plan to get there and how our financial targets look through 2028. But today, we are going deeper than in any previous other Investor Day. We are going to share with you our long-term vision for Deutsche Bank.

Two years ago, we defined our purpose, the reason why we exist, dedicated to our clients' lasting success and financial security at home and abroad. That's our North Star. That's the reason why we exist, that guides everything we do. And more so than ever, our clients demand exactly that, like we have just seen it in this small video. We also set our vision to be the Global Hausbank and the European champion. And today, we will show you on how we are living our purpose every year, every month, every week and yes, every day.

Everything you hear from us today is actually part of a bigger story, a well-thought and carefully thought-through story, which spans for the next three years. And you will hear a clear message from us, Deutsche Bank is fully back. And actually, we are going from defense to offense. And we see all this in the eyes of our stakeholders. We see it in our daily dealings with our clients across the four businesses. We see it in the capital markets with political leaders or in the communities we serve. And we see it in the way our people are united in Deutsche Bank's purpose and the way we collaborate. We also see it in the world-class talents we now attract to our platform. And we hope you will see today how we make this vision a reality and how we go over the next three years as a fully united management team. Today, more than ever, we are ready for what's next.

With that, thank you very much, and I hand over to our CFO, James von Moltke.

Good afternoon. A warm welcome also from me. My name is James von Moltke, President and Chief Financial Officer of Deutsche Bank. My role today is to talk to you about the journey that we've been on, the bank we've created and the foundations we've laid for the growth that lies ahead. On a personal level, it's an opportunity to look beyond the incremental quarter-by-quarter progress that we've reported to you and instead show how it's added up to something transformational. I'm immensely proud of what we've collectively accomplished. Our achievements reflect the leadership that Christian has provided, the hard work and partnership of my fellow management Board members and group management committee members, but most importantly, it reflects the dedication of our 90,000 employees around the world. It's been a team effort, but I'm also confident that there's more to come.

Let me start by saying this is a transformed bank. We're now well placed for profitable growth, and we've made the necessary foundational investments. The ambitions we will set out today are, in many respects, a continuation of what we've achieved in recent years, but now with the wind at our backs.

From 2018, just after I arrived and Christian was appointed Chief Executive, we initially focused on stabilizing the company. We needed a clear business model to reset our cost structure and to address gaps in our capabilities. We had achieved all of those goals by the last time we spoke to you at our Investor Deep Dive in March of 2022. Since then, we've delivered sustainable and increasing profitability while making targeted investments. We've significantly strengthened our foundations, rebuilt stakeholder confidence and position the bank for sustainable value creation above our cost of capital in the years ahead. We've embedded operational efficiencies and created a culture of accountability and control. Christian, Claudio, Stefan, Fabrizio and Raja will tell you where the bank is headed. But to set the stage, let me tell you where we are today.

We are Germany's leading bank with the 4 complementary businesses you see on the left. We are dedicated to our clients' lasting success exemplified by the EUR 1.7 trillion of assets entrusted us to invest. We are also dedicated to their financial security, holding EUR 660 billion in deposits on their behalf and around EUR 4 trillion of assets under custody, we safe keep for them. We have around 19 million private clients in Germany alone and support all our clients as they pursue their ambitions across 60 markets around the world.

The Global Hausbank concept is at the heart of our strategy. As the Global Hausbank, our goal is to build deep and lasting relationships with our clients, leveraging our talented people, advisory capabilities, international network, technology platform and our strong balance sheet. We have 3 types of clients under one roof: private individuals, corporations and institutions. Our franchise has a balanced revenue profile across these 3 groups with all of our divisions working closely together to serve them. We have transformed Deutsche Bank into a simpler, more focused business with a significantly improved financial profile. We expect the strong franchise performance momentum across the bank to deliver our revenue ambition of EUR 32 billion for 2025.

Our efficiency program has helped to deliver declining expenses and sustainable core operating leverage of 28% since 2021. Our tangible book value per share has increased by 22% to EUR 30 since 2021. We've also improved shareholder reward. Including the EUR 1 dividend per share we expect to pay next year and additional expected share buybacks, we should comfortably exceed our EUR 8 billion cumulative distribution target.

Let's look at how we've done this. First, as shown on the left, we reduced revenue volatility, simplifying our investment bank and focusing on 4 core divisions. Second, we have a balanced revenue mix, which is helping us to meet our targets in different operating environments and through business cycles. There's been a steady relationship between net interest income and noninterest revenues. Our revenue base is also diversified by region with around 20% from the Americas and just under 15% coming from Asia. Third, our growth since 2021 reflects broad-based contributions across the businesses. Our compound annual growth rate of around 6% over this period results in revenue growth of around EUR 6.6 billion. This shows the success of the Global Hausbank strategy in action with all divisions contributing to our revenue objective.

We also significantly improved operational efficiency, raising our cumulative target for cumulative cost takeout from EUR 2 billion to EUR 2.5 billion, a level we expect to achieve by year-end. Of this amount, 28% has been delivered through the optimization of our distribution platforms in Germany. Among other projects, we completed the IT migration of Global Hausbank, leading to EUR 300 million of annual savings. We closed around 200 branches in Germany over the past two years and continue to optimize our workforce, particularly in non-client-facing roles. Another 28% comes from front-to-back process redesign, for example, in the corporate bank operations and our Know Your Client platform. And 44% of the EUR 2.5 billion was achieved from technology and infrastructure efficiencies with over 2,000 applications retired and a 30% reduction in office space.

We've made self-funded foundational investments that were absolutely necessary to enhance our technology architecture, control environment and franchise while partly offsetting inflation. Our cost base in 2025 is expected to be about EUR 1 billion lower than in 2021, a reduction of over 4% over this period, creating significant positive operating leverage, as I said, as we increased our revenues by nearly EUR 7 billion over the same period. We've also closed out the majority of our legacy items that were unresolved at the time. Together with a diminishing need for restructuring costs, we intend to normalize our reporting of noninterest expenses from the first quarter of next year and no longer focus attention on adjusted costs.

Let me touch on the investments made. Some supported our business momentum, shoring up the client and product franchise where there was a need to rebuild or close gaps. This included strategic hires in Wealth Management and the revitalization of our Corporate and Investment Banking client coverage. We also invested in our FIC and Corporate Bank client delivery platforms. We've continued enhancing our compliance and control framework with steady progress towards a business-as-usual environment while recognizing that the anti-financial crime and compliance landscape will continue to evolve. And in technology, we have simplified our architecture, migrating business-critical systems to Google Cloud, and we have readied ourselves for scalable AI adoption.

These investments have gone hand-in-hand with prudent balance sheet management. We expect to have increased our CET1 ratio since the end of 2021 to around 14% or by 80 basis points by the end of 2025, and our capital buffer has risen to nearly 300 basis points above our regulatory requirements. This reflects organic capital generation as well as our capital optimization efforts, where we have achieved the higher end of our target range of EUR 25 billion to EUR 30 billion of RWA efficiencies. We achieved this ratio increase despite higher distributions and in a more conservative measurement regime, including the introduction of CRR3 and significant additions to RWA due to model revisions.

A strong, stable liquidity position was maintained throughout with high-quality liquid assets of around EUR 240 billion and a liquidity coverage ratio of approximately 140% expected at year-end. We increased the funding contribution from lower cost deposits while reducing outstanding unsecured debt instruments, making our balance sheet more efficient. Our resilient risk profile is supported by well-established risk management and controls. We are navigating macroeconomic uncertainties as we've done throughout our history. Group risk appetite is calibrated to earnings capacity, capital adequacy and operational stability. We relentlessly scan the operating landscape to identify and monitor risks, and we conduct regular as well as targeted stress tests to identify vulnerabilities.

Compared to before our transformation, our market risk measured by value at risk has significantly declined and has been running at an average of EUR 35 million since 2018 when Christian and I took over and remained broadly stable despite a number of volatile periods. And we have achieved record high revenues in our markets businesses. On the credit risk side, our loan book is high quality, well diversified and highly secured, and we deploy hedging strategies to manage concentration risks.

From this position of strength, we are now embracing our Shareholder Value Add or SVA methodology, implementing tools to measure value creation not only by looking at profitability, but also by taking into account the resources deployed. At a divisional level, we set a 13% hurdle rate to assess contributions. This pivots our capital allocation towards more profitable activity while offsetting the drag from the Corporate Center. To be clear, 13% is not the RoTE target we aspire to for each of the businesses. Rather, SVA measures in euro terms the shareholder value each activity produces. We've built sophisticated allocation mechanisms and reporting infrastructure to help our businesses understand how to drive value-accretive client engagement, price, end-to-end value chains and create SVA positive commercial outcomes.

We've already seen improvements with the proportion of business activities meeting the SVA hurdle increasing to around 40% in 2025, up from around 20% in 2021. Going forward, we will manage the bank increasingly under this paradigm, resulting in a sharpened business model, generating greater shareholder value. Christian will explain how we think about this later on.

Before I close, I want to say a few words about sustainability, which has been a central element of our management agenda since we launched our Compete to Win strategy in 2019. We've made tangible progress and shown consistent commitment to ESG principles across our businesses and are now a leader within our peer group. Carbon intensity targets are directly tied to long-term compensation for the Management Board. Our culture, controls risk management and governance all feed into how our bank can be not only sustainable but also sustainably profitable. Looking at the very detailed submissions to the agencies every year as I do, I believe the numerous ESG rating upgrades since 2021 exemplify the transformation the bank has achieved across all dimensions. This, too, reflects the solid foundations we've built for well-controlled growth.

Let me now turn to our financial performance in 2025. We are on track to deliver on our financial targets, starting with a greater than 10% RoTE. Our diversified complementary business mix is driving strong revenue performance with an expected compound annual growth rate of approximately 6% since 2021. Increasing cost efficiency and delivery of our critical programs is expected to result in a cost/income ratio of below 65%. Our capital base is stronger than ever with an expected CET1 ratio of 14% at year-end. And we have increased shareholder returns with distributions of more than EUR 8 billion expected for the years 2021 to 2025.

The results of disciplined work across the organization is a transformed bank ready to scale. We have a more balanced and stable revenue profile. We have continued to rightsize operating costs while self-funding investments and managing inflationary pressures. The majority of legacy litigation items are now closed, reducing tail risks. We've strengthened our capital base and launched substantial shareholder distributions. As I said, I'm very proud of what we've collectively achieved. Deutsche Bank can now accelerate value creation through a rigorous SVA-driven approach. The cultural shift across the bank is equally, if not more important, with a strong sense of accountability and purpose as well as better collaboration across the divisions.

I'm proud too to be handing the reins as CFO of this company to Raja Akram at a point where we have built solid foundations, and we're positioned to succeed. Raja and I have known each other for more than 16 years, and we worked together closely for 8 of those. But we've never worked harder or better together than since he joined Deutsche Bank, and he and I have worked to build the strategic and financial plan, which he'll have the job of presenting shortly. Thank you.

And with that, I'll hand over to Christian.

James put it simply, we have delivered what we promised and we are a different bank today. We delivered growth from refocused businesses, reduced costs and build operating leverage. We have a very strong balance sheet and firm control of our risks. And most importantly, our clients have full trust again in Deutsche Bank. As a result, we have put Deutsche Bank on a path to meet or exceed its targets and increase distributions to shareholders. And since we launched our transformation back in 2019, our share price has risen from less than EUR 7 to above EUR 30.

We are the strongest we have ever been. As the Global Hausbank, we are uniquely positioned to help our clients steer through a changing environment. We have a clear path to deliver value and elevate returns by scaling our Global Hausbank. And today, we are going to tell you how we plan to make this happen. Yes, we are proud of what we have achieved, but hitting our 2025 targets is not a destination, it's a milestone on a longer journey.

We have built considerable operating momentum and trends in the environment play to our strengths. Furthermore, AI gives us transformational opportunities right across the entire bank. We are moving from defense to offense. And our way forward is clear. From 2026 to 2028, we will accelerate value creation by scaling our Global Hausbank. And this will enable us to reach our long-term goal to become the European champion. A truly global bank, domiciled in Germany, the largest economy in Europe and the #3 in the world, a champion for our clients as their trusted partners and a champion for shareholders in the value we create for them. And today's world, as I said, is playing to our strengths.

First, globalization is here to stay, but it is being redefined. Regional blocks are forming and governments are more assertive of national interest. But let's be clear, trade flows will shift, but global trade overall will continue to grow. Demand for globally connected financial services with local expertise is clearly increasing. Second, Europe is taking steps to boost growth and competitiveness. Not surprisingly, we have already seen that investor interest in Germany picked up in particular in Q2. Third, populations are aging, driving generational wealth transfers. In Europe, corporate and private retirement provision is far behind the U.S. and other markets, and this must change.

Fourth, AI is changing the world. Many companies will need to transform and invest significantly to stay competitive. And Deutsche Bank is also transforming, and we will talk about that later. Fifth, geopolitical uncertainties are impacting the global economy and driving volatility. And finally, new risks are emerging and happening more frequently. Regional conflicts, cyberattacks, extreme natural events all make risk management a top priority for our clients. And these trends have one common denominator. Financial strength, global reach, local expertise, strong advisory and risk management capabilities are vital to our clients. A reliable partner, a partner you can trust is more valuable than ever and Deutsche Bank is that partner. What we see increasingly in client meetings all around the world is the demand for a European alternative. And in global banking, we are that alternative.

Now let me discuss why our offering is so well aligned to our client needs in the world of today. In Europe, savers are preparing for retirement. The most recent survey by Deutsche Bank and DWS shows that 83% of Germans do not believe that the state pension on its own will be sufficient or enough. We have a comprehensive offering to address this gap for our 19 million private clients in Germany, who will see investments as their key need. In uncertain environments, clients need to deploy liquidity and capital more quickly, but also more safely. Our global payments and servicing capability covers a full range of cash management, payments and security services, and we have invested heavily into these segments. We can provide advisory expertise and capital markets access to help clients execute complex transactions. Our global markets expertise, especially in fixed income and currencies, offers clients ways to manage and hedge emerging risks.

At the start of our transformation, we took a very conscious decision to build a focused global debt powerhouse and exactly that decision paid off. Also, not everyone would have predicted that foreign exchange would reemerge as a vital capability, but it has, and we are the global leader. Our fully integrated financing supports clients in funding the transformation of their businesses. We also plan to build on our momentum in helping clients transition to more sustainable business models like James just outlined. In other words, we do have the complete set of capabilities suited to today's environment and tomorrow's challenges. But to scale up, we need to do more. And that is exactly what we aim to do.

All 4 of Deutsche Bank's businesses have leadership positions in Germany and Europe, and they have global strengths. And to scale up our client offering, we plan to focus on key priorities. First, we are fostering a culture of client-centric accountability and collaboration. Look at our purpose statement. We have united our business around this common purpose. And this is exactly helping us deepen collaboration across business, remove the silos of the past and deliver the one bank to our clients. Already, the Corporate Bank and Investment Bank are teaming up more closely to capture opportunity in growth areas like defense and infrastructure. We are already connecting the outstanding investment product of DWS to our private clients. Now we take it a step further. We are strengthening the collaboration on entire retirement provisioning. My colleagues will discuss far more examples with you today. But the way we are offering One Deutsche Bank to clients is improving every day.

Second, we are leveraging a key differentiator, a network spanning 60 markets globally. Our global network connects German and European clients with global opportunities. We also offer a gateway into Germany and to Europe for our international clients. And we are actively covering new trade corridors such as the growing trade between Asia Pacific and the Middle East. Third, we are scaling to grow in areas core to our Global Hausbank, such as asset gathering, payments and servicing and advisory. Where we have leadership positions, we are gearing up to consolidate our market leader advantage. And this applies especially to our global markets and financing business. And this comes at a very low marginal cost.

We have an established scalable platform. And in particular, in these times, clients prefer doing business with recognized brand names. Finally, we are actively expanding our digital channels to connect us more closely to our clients. To summarize, the operating environment plays to our strengths, and this gives us a unique opportunity to scale our Global Hausbank. And this enables us to accelerate value creation for shareholders between 2026 and 2028. First and foremost, we plan to accelerate from an RoTE of above 10% in 2025 to an RoTE of greater 13% in 3 years. And that will enable us to increase distributions to shareholders also based on an increased payout ratio. We are confident in achieving this as the key levers are firmly in our hands. SVA-driven steering and accountability supports all of these levers. And let me start with focused growth.

We have built revenue momentum. Now we are using this momentum to full effect to accelerate further in the most value-accretive areas. The second lever is strict capital discipline. We have built capital strengths. Now we are going further by actively managing this capital for the benefit of our clients and shareholders. We will enforce strict hurdle rates, take balance sheet to the next level and eliminate inefficiencies. Our third lever is a scalable operating model. And this means further integrating and automating core processes, investing further in technology, AI and innovation and very important, attracting the best talent. This third lever is all about client experience, process efficiencies and strong controls. And all this enables us to turn revenue growth into higher operating leverage. And as you can all well imagine, transforming that what James talked about, transforming Deutsche Bank required a lot of internal focus. We simply needed to fix the core, controls, compliance and technology. It was a restructuring exercise.

Now we are all shifting our focus decisively towards growth, towards clients and ultimately towards our shareholders. And that starts with me and my colleagues on the Management Board. What will not change, however, is that everything we do is built on very strong foundations. James outlined our diversified business mix and our significantly improved financial resilience. Later today, we will discuss how this helps us to accelerate value creation and generate strong returns through the cycle. So let me now discuss these 3 levers in detail, our objectives, the actions we plan to deliver and the financial impacts, starting with focused growth.

Deutsche Bank today is a growth story. We aim to grow revenues by more than 5% per year compound and that would increase annual revenues by around EUR 5 billion by 2028. And we see this as highly achievable for several reasons despite normalizing interest rates. Part of it is already locked in, as Raja will explain later. In addition, we have grown revenues at 6% per year compound since 2021, while fixing the core at the same time. And on top of that, the environment is more supportive to our growth than ever before.

Going forward, our objectives are to capitalize on our leading position in our home market, to integrate the Global Hausbank more closely into a seamless experience for clients across the world and to take full advantage of our strength and capabilities to help clients navigate the changing environment. In practice, this means scaling up in focused growth areas such as asset gathering, payments and advisory. We actually expect around 75% of our revenue growth to come from these areas. And of course, we are aligning our investments around them. And where we have leadership, we aim to build on and consolidate it. We are determined to remain a debt powerhouse across our world-class FIC franchise, financing and lending. And here, we will create value by growing scale while optimizing platforms and resource efficiency.

We aim to grow these areas across several dimensions. First, by deepening our share of wallet with existing clients through better connectivities across the businesses. We see considerable still untapped potential to do more with existing clients. Second, by attracting new clients as we scale up the Global Hausbank as we just discussed it. Third, by improving client experience through digital interfaces, my colleagues will say more about this. And fourth, through innovative new products to meet clients' needs as they emerge. And SVA is also a growth catalyst. It highlights opportunities and focuses our client efforts on the most accretive growth areas.

In each focused growth area, we have set ourselves clear milestones for 2028. These enable us, but also you to track our progress. For example, in asset gathering, we aim to reach EUR 1 trillion in client assets in the Private Bank, roughly an additional EUR 200 billion from today's level. In Stefan's business in the Asset Management, we want to achieve cumulative long-term net flows of more than EUR 160 billion. We aim for deposit growth of around EUR 100 billion across the Private Bank and the Corporate Bank. In Advisory, we continue to aim for a market share of greater than 3% in the global investment banking fee pools. In sustainable and transition financing, we plan to build our progress since 2020 with a new target of EUR 900 billion in volume by 2030.

Now let me discuss how we aim to capitalize on our home market leadership. And I'm fully aware that you are all very interested in our Germany story. And yes, Deutsche Bank's leadership in our home market is a key asset and will always remain a key asset. We already have a higher market share and customer penetration across all businesses. For example, all German companies listed on leading indices do business with Deutsche Bank. However, we cannot rest on our laurels. We can still do better and Claudio, Fabrizio and Stefan have already made key changes to gear up. And I'm convinced we can. No actually, we must do a lot more to fully leverage the opportunity presented by our home market.

We have significant potential to capture additional market share across all businesses. In fact, we expect Germany to account for EUR 2 billion out of the EUR 5 billion of the total revenue growth we aim to achieve by 2028. By leveraging a strong and scaled-up platform, we have headroom to grow at a low marginal cost, and that obviously further boosts operating leverage. And we can achieve this by our unique combination of strengths. First, no global competitor can match our deep roots in Germany. For over 150 years, we have been the trusted adviser to German industry and society, and that will not change.

Second, no local competitor can match our global network as a gateway to or from Germany and Europe. By connecting our home market position with this global network, we plan to attract both inbound and outbound business flows. Third, we plan to use our large and stable base of customer deposits to fund further growth at attractive costs. And we see opportunities to further improve. We can harvest the benefits of recent investments to integrate the technology behind our core banking platform and client coverage.

We also plan to upgrade our client-facing product platforms and interfacing across retail and corporate clients. In addition, we have already strengthened our leadership bench in Germany. And all of this is our own work. None of these measures depend on any German stimulus program. That's all us. However, we also plan to amplify the returns from our own efforts by taking advantage of tailwinds in Germany's policy and macro landscape. And several trends are aligning in our favor. And let me say a few words on this.

Germany remains a large and innovative economy. The number of German unicorn companies valued at more than EUR 1 billion has actually tripled in the past 5 years. You don't read it, but it's a fact. In our view, economic momentum will accelerate in 2026 and beyond. Fiscal stimulus is expected to add around EUR 400 billion of investments through 2028. And initiatives such as Made for Germany prove that these measures attract a powerful private sector multiplier effect. Investment commitments from corporate Germany are already above EUR 700 billion to 2028 and rising.

We are convinced we have only seen the beginning of what's possible from the partnership between the public and the private sector. And also in this regard, don't forget, Deutsche Bank has considerable experience of working with institutions like KfW to transmit the benefits of policy measures into the real economy. The government's long-term transformation agenda may also add as much as EUR 1 trillion to Germany's economy over the next decade. All 4 of our businesses have strategies in place right as we speak to take full advantage. In the Private Bank with Claudio, we plan to help clients boost retirement savings by accelerating deposit capture, converting deposits into investment and pension solutions.

In Stefan Asset Management, we plan to accelerate growth in private markets and scale up offering in ETFs. In Fabrizio's Corporate Bank, we see opportunities to finance capital and operating expenditure for clients as they gear up to capitalize on the improving economic outlook.

And this will drive, think about the Global Hausbank, cross-sell right across the franchise. In the Investment Bank, we grow in sectors which benefit from stimulus measures as defense and infrastructure but also certain others. And we also expect these to boost capital markets issuance volumes. Altogether, we see the fiscal and policy backdrop in Germany is contributing positively to revenue growth in our home market. But here, too, we are planning prudently. We only factor in the financial benefits of measures which are agreed as of today. Hence, our business could accelerate further if stimulus and structural measures gain traction beyond this.

Now moving to our second key lever, strict capital discipline. We are convinced we can further improve capital productivity in the next 3 years. Today, as James outlined, we are financially stronger and far better positioned with clients who actually understand that we need to deploy capital commercially. And this enables us to increase capital productivity more forcefully in this next phase of our strategy. We have identified scope to boost our revenue to risk-weighted asset ratio by 100 basis points between the end of this year and 2028. And this would represent a material improvement from the base of around 11% to around 12%.

Our objectives are the following: First, to deploy more capital towards higher return areas. Second, to eliminate capital drag from areas whose returns simply do not meet our criteria. And third, to increase return of capital to shareholders. To boost capital productivity, we plan to apply several levers. These include applying a more rigorous pricing and clear SVA hurdles when we originate business; reallocating capital away from sub portfolios which do not meet our hurdle ratios and criteria in a more disciplined manner than before; and taking balance sheet management to the next level, and thus increasing asset and balance sheet velocity. We intend to optimize origination practices to make it easier to move assets off balance sheet and to expand the use of SRTs and cash securitizations. All 4 businesses will contribute to this effort, and here is how.

In the private bank, we plan to optimize capital efficiency in our mortgage and consumer finance business and actually focus on capital-light Lombard lending. And initial results in Claudio's business, and parts of the German mortgage business are very encouraging. In Asset Management, we plan to deploy seed capital in Alternatives and selectively pursue opportunities to grow inorganically. In the Corporate Bank, our plan is to optimize capital use in Trade Finance and Lending and reallocate capital into higher-return activities. In the Investment Bank, we are convinced we can redeploy capital into higher return areas within the FIC financing business and increase overall balance sheet velocity. And yes, finally, we will evaluate selected exits of subscale offerings and geographies in a disciplined manner.

Now let me come to our third lever, a scalable, business-led operating model. So what does a scalable operating model mean for Deutsche Bank? It means our processes are integrated and automated. Our organization is lean and adaptable, and the innovative use of AI is a core element of how we operate. In this next phase, we have made a conscious decision to invest further. However, the focus of our investments will shift away from fixing the core towards efficiency and business growth. And we expect this to further boost our operating leverage and improve our cost-to-income ratio to below 60% in 2028.

We plan to roll out targeted programs to drive a further EUR 2 billion in gross annual efficiencies. And this comes on top of the EUR 2.5 billion we have delivered through 2025. It also allows us to address the areas where we lack our peers on costs. And from benchmarking, we know exactly what these are, and we will take them systematically.

Last but not least, Deutsche Bank today is attracting world-class talents. And we are uniting both new and existing talent around our common purpose, our Global Hausbank vision and a simpler organization.

A scalable operating model benefits our clients, our own people, our capabilities and processes and our technology. And as you will see today, we will expand digital and self-service offerings across our business to improve client experience. By simplifying our organization, we actually provide our people with clear accountability and faster decision-making. We create development opportunities which make Deutsche Bank an even more attractive place to work for. And we are also changing how we deliver capabilities and processing by moving towards a model of enterprise-wide delivery platforms.

Our aim is to do everything but only once. For example, one payment platform in the Corporate Bank but servicing all divisions. Or we aim to apply a unified lending process across the Corporate Bank, the Investment Bank, but also part of Wealth Management. And this enables us to remove duplications and to optimize front-to-back with a clear business ownership. We are also moving towards an integrated target technology architecture based on a hybrid cloud. And this will give us added flexibility and scalability while further enhancing resilience and security. We aim to reduce costs by around EUR 400 million over time with this improved technology architecture.

AI also has a very significant role in our future plans. Based on our experience so far, we are convinced AI offers us a potential step change in cost efficiency and the delivery for our clients. And let's discuss that more in detail.

We are already deploying AI at scale, and that right across the bank. We have built firm foundations across our technology platforms, our organization and governance and our control environment. And let me give you a few examples of the concrete benefits which we are already seeing. Deutsche Bank Research has identified potential to use AI to double the number of companies covered without adding additional resources. In software development, we expect productivity improvements of up to 20% over time just from AI-assisted coding. In the Private Bank, we identified around EUR 300 million in savings by moving to an AI-enabled operating model. And we are using AI to strengthen essential controls while achieving our cost efficiencies.

Ladies and gentlemen, this is only the beginning. AI is developing so fast, and I'm convinced that more, much more is actually possible. Our ambition for the next wave is to make Deutsche Bank a truly AI-powered bank. And in this regard, I have tasked every member of my executive team to take full accountability and responsibility and lead the next wave of AI transformation in their respective areas. And we are rolling out AI training, not only for senior leaders, but across the entire workforce. It starts with an AI-first mindset and a clear focus on the greatest opportunities.

We are aiming to deliver hyper-personalization and integrate agentic AI. And additionally, we are preparing for a generational transformation in our workforce, as Raja will explain later. As our people retire, we aim to shift activities to AI, while at the same time capturing the knowledge and experience of the departing colleagues. And given the speed at which the opportunities are evolving, the true financial benefits of this next wave to Deutsche Bank could far exceed what is in our plans today.

So let me sum up the 3 levers of our road map to an RoTE of greater than 13% over the next 3 years. We have achieved growth momentum. Now we will drive accelerated growth in our focus areas. We have built capital strengths. Now we will further sharpen capital discipline. We have improved operating efficiency. Now we will implement an integrated, lean and scalable operating model. So how will this accelerate value creation?

In the past few years, and James hinted at that, we have roughly doubled the share deployed in business activities exceeding the hurdle rate to around 40%. By 2028, our ambition is to raise this proportion to above 70%. We see opportunities to increase SVA generation across all businesses. In the Private Bank, our focus will be on operating efficiencies in retail, scaling up Wealth Management and optimizing capital deployment. In Asset Management, we plan to leverage the position of DWS as the gateway to Europe for international clients and exploiting the potential for digital disruption.

In the Corporate Bank, we will focus on growing our capital-light products and fee-based platforms, optimizing our capital usage and unlocking structural efficiencies. And in the Investment Bank, our priority is twofold. First, to refocus our client management towards advisory and corporate relationships; and second, to maximize returns from our leading position in FIC and close out remaining gaps in our competitive position. Reinforcing a culture of accountability is essential to our use of SVA, and this will include aligning management incentives more closely to value for shareholders and linking SVA directly to the compensation of our senior leaders.

Before I conclude, I would like to summarize how we aim to drive RoTE in this next phase of our strategy.

This management team is firmly committed to taking Deutsche Bank to an RoTE of greater than 13%. As we have seen, our Global Hausbank is the key differentiator in the changing world of today. We have, in our hands, all the strategic levers which get us to our target. We are using SVA to drive greater focus on returns. And we aim to distribute more of these returns to shareholders and increasing our payout ratio to 60% from 2026. Our incentive structures are more closely aligned to shareholder value than ever, and we consider an RoTE of greater than 13% as a floor, given the upside we see from several tailwinds in our environment.

A few words on this. Some external factors are already in our plans, but with very prudent assumptions, and could well take us further. The German economy may accelerate faster as stimulus and structural measures take effect. We may capture a significant further AI benefits that go beyond our plans. Furthermore, the upside from other factors is not included at all in our plans. EU-wide initiatives are harder to predict for us, but may bring considerable opportunities. And as you know, Deutsche Bank is perfectly positioned to benefit from further harmonization of Europe's capital markets, not in the plan. As the focus of policymakers shift to growth and competitiveness, we may see a more level playing field in our regulatory environment, not in the plan. This would benefit both Europe's banks and Europe's economy. In short, the upside beyond our target is considerable.

Now let me conclude with our long-term vision. Scaling our Global Hausbank in the next 3 years enables us to achieve our long-term vision to be the European Champion. What does it mean in practice? It means leadership in key business segments. It means, in this world, being the partner of choice for our clients. It means leading the market in returns. And it means a scaled, deep global presence and network. And yes, it means becoming a truly innovative and AI-powered bank.

We have everything we need to make this vision a reality. We have the financial strengths, we have the momentum, we have the right team, we have the restored trust of the franchise and society, and we have the deep dedication. If we have regained pride in Deutsche Bank, which I feel and see in this great organization every day, today the world needs a Global Hausbank. And I'm not shying away. In fact, the world needs Deutsche Bank.

With that, let me hand over to Claudio.

Thank you, Christian, and a warm welcome to everyone in the room and online. I am Claudio de Sanctis, and I'm the Head of the Private Bank. And over the next 25 minutes, I'm going to present you a plan that is clear, predictable and compelling, one which is based on a strong track record of past execution, one which is built on a consistent and focused strategy with many of the levers already underway or in our hands to deliver, a plan which will generate EUR 1.2 billion of incremental SVA with further potential upside.

In the first part of my presentation, I will show you how we have delivered one of the most compelling operating leverage improvements and how that has laid the foundation for the future growth of our 2 businesses: Personal Banking and Wealth Management. In the main section, I will explain the key levers that will deliver our future incremental SVA. Specifically, in Personal Banking, we will focus on all 3 levers: revenue, costs and capital. In Wealth Management, on the other hand, we will now invest to accelerate asset gathering, to scale up the business. And finally, I'll close by sharing with you a couple of additional growth drivers, which will highlight further potential upside to the plan.

So let's look at our track record, and let's start by showing you how we delivered our operating leverage improvement. This was, first of all, the result of a consistent strategy of strict focus on clear segments and geographies where we can compete to win. In Personal Banking, we are market leader in our home market with 18 million clients, banking a 1/4 of Germany through 2 distinct and complementary propositions: Deutsche Bank as the Hausbank for financial advice and Postbank for digital-first everyday banking.

Internationally, we're focusing on emerging affluent clients as a pipeline for wealth segments. In wealth segment, our competitive strength lies in delivering our Global Hausbank, to ultra high net individuals and their family offices, from LA to Europe, the Middle East, all the way to Asia. Through our bank for entrepreneurs, we are ideally positioned to advise European family entrepreneurs, offering one holistic approach for both their private and their company needs. And finally, we're focused on providing investment advice to affluent clients in Germany, in Italy, in Spain and in Belgium.

Since 2021, driven by a disciplined execution, we have transformed the Private Bank in a more focused, efficient and connected franchise with significant improvement in the cost/income ratio, which has reduced from 96% in '21 to less than 70% today. This was achieved by growing revenues 18% and reducing cost by 15%.

Looking now more in detail of the 2 businesses, which, by the way, we created a separates segment in '23. In Personal Banking, we're now seeing the benefit of our transformation with a 10 percentage point reduction in cost/income ratio, 9 of which just in the last year. This was achieved with EUR 650 million reduction of cost and with an 18% reduction of staff.

To give you an example of this cost initiative, in Germany, we've closed an additional 183 branches, roughly 20%. But we did that whilst at the same time making available to our clients, 12,000 retailers for cash withdrawals, improving, hence, a critical service at a significantly lower cost. We've also migrated clients to the DB, the Postbank clients to the DB platform. And we have upgraded all of our German clients to a common cloud-based online and mobile banking app. This has resulted in a saving of around EUR 300 million. But in Personal Banking, it has not been only about cost. We've also delivered strong revenue growth in key areas such as deposits and investments, which grew by 14% in the last 2 years. And we also started optimizing capital, where we have, for example, discontinued the DSL brand in Germany, our white label mortgage business.

Turning to Wealth Management. In this business, we keep executing our focused strategy and have become one of the most efficient in the street. Since '23, we've improved the cost/income ratio by 13 percentage points to 63%. And focused strategy means that we exited nonstrategic areas such as our DB Financial Advisory business in Italy and the LatAm business booked in Germany. And we've also dramatically simplified businesses like in the U.S. On the revenue side, we've delivered double-digit growth in APAC, in the Middle East, in the U.K., in those places where most of our strategic hiring took place. And at the same time, we've also grown globally our revenues from Discretionary Portfolio Mandates by 70%.

Looking at the asset gathering, we have a strong momentum across both our business, and this is a solid foundation for the future. Since '23, we've grown our Personal Banking AUM by 9% per annum, driven by strong deposits and investment volumes. And in the same period, in Wealth Management, we've generated nearly EUR 60 billion of net new assets, a 4% growth rate which is higher than peer average. Additionally, we launched our flagship Strategic Asset Allocation to great success, with around EUR 17 billion inflows into this solution since inception. So in aggregate, this has led to a significant improvement in the Private Bank's return on tangible equity, rising from 2% in '21 to 10% today.

So with this track record in mind, let me now take you through the main levers of our plan. As I mentioned earlier, in Personal Banking, we're focusing on all 3 levers: revenue, cost and capital. Let me start with revenues. We do expect a prolonged period of structurally higher interest rates, which will continue to support higher margin and drive demand for deposits.

So far, this year, we've attracted EUR 15 billion in fresh deposits, much of which came through low-cost digital channels. For example, the last campaign we did in Postbank, 75% of the new accounts were opened digitally. Looking ahead to '28, we aim to generate EUR 50 billion of additional gross new deposits. And again, mostly via digital or remote channels. The expected fiscal and pension reform in Germany, as Christian was mentioning, presents a significant opportunity for us, given our competitive position as the leading German bank for investment advice. We will help our clients manage their pension needs through dedicated discretionary and investment solution.

And finally, digitalization and AI are radically transforming how we engage with clients, enabling greater personalization and actionable insights. AI-powered analytics help us anticipate needs, attract clients and increase the number of multiproduct relationships. Clearly, this will require a doubling of investments into that -- into digital marketing. So altogether, we expect the revenues of the Private Bank to grow at a 5% to 6% compound annual growth rate between '25 and '28, with Personal Banking growing slightly below that range but at a steady rate.

Turning to cost now. We will continue to get additional run rate benefits from our existing programs. For example, as announced already, we will close a further 100 branches by the end of next year and we will continue to review our sales network in line with customer preference. And in fact, around 35%, 35% of the cost savings in the next -- in the next 3 years have already been negotiated and started. But of course, we will also launch new programs. Consider operations, where given the issue we faced around the integration of the Postbank platform, we have to actually increase staffing and slow down the pace of digitalization and automation.

Now with the remediation of the backlogs completed and we restored customer service, we are ready to deploy agentic AI to fully modernize and automate this critical function, whilst at the same time providing an enhanced client experience. This will entail extending digital onboarding to more clients, increasing self-service in our digital channels and improving our communication to customers by providing in-app notification and much more, but we will also radically simplify business processes to reduce duplication and drive standardization. For example, we will consolidate our KYC processes from 27 to 2, aligned by client risk type. As a result, by 2028, we expect the cost of operations to reduce by at least EUR 100 million.

But by far, the largest driver will be the overall transformation of the Private Bank operating model. Today, globally, we operate 15 different core banking systems. Going forward, that will be consolidated into 2 modern cloud-based platforms, one for Personal Banking and one for Wealth Management. As you heard from Christian, agentic AI will play a key role in accelerating the modernization of our technology landscape to discovery, data management, code translation.

To further simplify our operating model, we will also redesign our application landscape. And we aim to reduce the number of applications we use by around 40%. This will be a multiyear program, leveraging the expertise we've gained from recent transformation programs, starting first in Germany and later being rolled out internationally. The phased approach and the significant experience that we gained in the past 3 years make us confident that we can deliver this program, mitigating the implementation risk. We are not simply looking to improve today's operating model. We are building the model for the future, one that fully leverages the best technologies available today. Overall, during the next 3 years, we will have to invest over EUR 600 million in IT, operations, AI, and we expect an overall run rate savings of around EUR 300 million by '28 and, of course, more in the following years. Together, these initiatives will continue to drive positive operating leverage in Personal Banking, reducing the cost/income ratio to around 60%.

And finally, we will continue to free up capital, freeing up from low returning portfolio in Personal Banking and redeploying some into Wealth Management and some in the transformation of operating model. The rest will be used to reduce the shareholder equity required to run the Private Bank. By 2028, we will decrease the shareholder equity in Personal Banking by a further 15%. And to achieve this, building on the recent successes in Germany and Italy, we are investing in a true sale platform, which will allow us to launch new types of securitizations. And in parallel, we are also continuing to optimize portfolio, portfolio that do not meet our strategic focus or do not generate positive SVA. For example, we will continue to transform tirelessly or if necessary, deemphasize our Personal Banking activities outside of Germany, where and when we do not have the scale to compete effectively.

Let's turn now to Wealth Management. Here, we will continue to invest in increasing client assets. Expanding the focus we had on asset under management to also include asset under custody. As we see assets under custody as an important feeder for investment. This effort will be underpinned by 2 key investments. Since '23, we successfully attracted 143 ultra-high net worth bankers while systematically managing out low performers with a net result of a 10% reduction, while at the same time producing the asset gathering growth rates you have seen in the earlier slide. We now plan to hire up to a further 250 bankers, focused on Germany, Italy, U.K., Middle East and Asia.

Now, what -- we will always keep enforcing rigorous performance management. But given the work we've done in the last 3 years, the overall number of bankers this time will grow materially. And please note that we have been working on a strong pipeline, and we expect the majority of the bankers to start in '26, bringing in assets already in the same year and becoming value accretive since 2027.

Second, the European affluent wealth. It is one of the largest pool of uninvested wealth globally. And we are already serving nearly 2 million clients, spanning 3 of the 4 largest Eurozone economies. And in order to better capture this opportunity, we're developing a new digital investment solution to support the wealth planning needs of these segments. At the heart of this offering will be a customizable discretionary mandate via gold-based planning interfaces. This will empower clients to save and invest more effectively as their life span increases and their private pension needs grow. With this, we expect to at least double our DPM volumes in the next 3 years. Overall, the asset gathering initiatives will lead to an increase of our annual NNA growth rate to 6%.

And in addition, we will continue to invest in our product offering to support the growing client base. For example, we're integrating private market allocations into our DPM solutions, working with best-in-class strategic partners such as our recent collaboration with DWS and Partners Group. This will give our clients access to new source of return and provide further diversification, reinforcing our position as the leading Eurozone provider for DPM solutions. Importantly, we will also grow Lombard lending, which allows our clients to keep their core assets invested while still accessing liquidity for new opportunities. We will embed Lombard lending in our asset allocation framework across all management, including digital proposition.

In summary, over the next 3 years, we will invest in this Wealth Management business, around EUR 300 million in talent, in platforms and in solutions. And as a result, we plan for revenue growth in Wealth Management that exceeds the 5% to 6% CAGR of the overall private bank. And ultimately, we expect the SVA of Wealth Management to more than double by 2028.

Let's look now at the upside. There are 2 main areas, which are largely in our control but are not yet fully baked into our plans. We've just discussed the impact of agentic AI as a powerful driver of cost efficiency. But looking ahead, we see a significant opportunity to leverage agentic AI to open new revenue opportunities. One of the most exciting developments will be the introduction of an AI voice-enabled agent which will act as a banking butler, the next generation of banking.

Let me explain you how it will work. The banking AI butler will interact through conversational voice as an intelligent proactive agent that understands the client context and behavior. It will support customer assistance through our mobile app and call centers to over time expand to manage end-to-end transactions. This unique service will create a fundamental bridge for the large majority of German customers who are not digitally native, changing radically how they interact with us, with the bank.

With the power of artificial intelligence, we can democratize access and extend high-end personalized service to every client. It will also collect specific personalized customer feedback. And it will analyze it in real time, reinventing the NPS approach, and providing us a real-time road map on how to best develop it. Within the next 3 years, our goal is to extend this AI banking butler to provide also advisory and investment solutions. From there, the step to nonbanking services is a small one, but an incredibly transformational one.

Second, Wealth Management. You heard from Christian, you heard from James, you will hear from all of us how [ disctincting ] a fundamental the Global Hausbank is, how it is our true competitive advantage. Through the fantastic partnership with Fabrizio around the IB team, we have perfected the connectivity, which provides our ultra-high net worth clients access to superior fixed income and FX capabilities. This is today the leading benchmark in the wealth management industry. Our partnership with DWS provides our clients with access to institutional investment solution. And it is with Stefan and his team that we will partner to launch the digital investment platform for our affluent clients, and we will also jointly develop the pension products.

However, there is one area where we have to yet fully realize the true potential of the Global Hausbank, and that is with the German Mittelstand and with the European family entrepreneurs. As the Global Hausbank, we are uniquely positioned to serve family entrepreneurs. And not only in Europe, but also globally whenever European connectivity matters. And for that, the corporate bank plays a key role in bringing the bank for entrepreneurs to life with joint client acquisition and providing essential services, such as cash management and trade finance. Together with our Wealth Management capabilities, this creates a single integrated value proposition for our clients, serving both their company and their private needs in one joint approach. And I, for once, could not be more excited to work with Michael and Ole to unleash this potential, and I am certain that there is further upside to our plan in this partnership.

In conclusion, this is a clear and simple plan. It is rooted in a strong track record with most of the levers firmly in our control. And it is with this plan that by 2028, we will have EUR 1 trillion of client assets in the private bank. We will grow revenues by 5% to 6% per year. And we will maintain positive operating leverage every year, bringing the cost/income ratio to 60%. And finally, it is with this plan that by 2028, we will deliver a return on tangible equity greater than 18%.

A personal note. Over the last 3 years, in the many discussions I had with most of you, I heard several times you referring to the Private Bank as a hidden gem. We would have discussions where I would present in my flamboyant way, the beauty of the Private Bank. And at the end, you'll be a bit surprised and say, "Well, this is a hidden gem." Now I genuinely trust and hope that after this presentation, you understand the value of this business without anything being hidden. And if you can see in your eyes, the beauty of this business just as I can.

With that, I thank you for listening, and I hand over to my partner, Stefan.

So good afternoon, ladies and gentlemen. My name is Stefan Hoops, and I'm the CEO of DWS, the asset management arm of Deutsche Bank. People say that asset management is a very simple business. So all you have to do is gather new assets, keep margins stable and manage costs with discipline. But of course, as many of you in the audience know, in reality, it's not that straightforward. So allow me to tell you how our strong ETF platform and the renewed investor interest in Europe have driven above-market net inflows over the last 3 years. How we are successfully addressing the industry challenge of margin dilution by building our alternatives offering. And finally, how we were able to grow revenues while reducing costs, creating strong operating leverage. These 3 ingredients have led to a strong share price performance over the last 3 years, with us ranking at the top of all traditional asset managers. We are fully focused on continuing on this path of delivering significant shareholder value.

Let me start with our platform. As you know, DWS is separately listed, with Deutsche Bank owning roughly 80%. What is distinctive about DWS is the breadth of our franchise. Our EUR 1 trillion in assets can be broken down across asset classes, client types and regions, and we have scale in each. Starting with asset classes. We are one of only a few global asset managers with more than EUR 100 billion in each of active equity, active fixed income, multi-asset, ETFs and alternatives. That gives us resilience through cycles without relying on any single style or capability.

Our global footprint reinforces the strength. We are present in markets where wealth is growing, and partnerships such as our joint venture, Harvest fund Management in China provide local depth while keeping us globally connected. And finally, we are well balanced across retail and institutional clients and not reliant on captive distribution. That independence reduces event risk and gives us greater control and agility. Our diversification across products, clients and regions provide stability, optionality and the ability to allocate resources to the most attractive opportunities.

We will continue to operate with a systematic and disciplined approach to resource allocation, which we introduced at our own Capital Markets Day in 2022. We continuously evaluate the components of our franchise, look at our relative strength versus competitors and the structural growth outlook for each segment. In areas where we have clear strength and where the market is growing, such as ETFs and alternatives, we allocate more resources to scale faster and take share.

In businesses with strong capabilities but limited structural growth, for example, in our active franchise, we maintain the level of resources with those areas largely self-funding. We continuously review our businesses and where we do not have scale or, frankly, the right capabilities, we reallocate resources towards higher return opportunities. Past examples include exiting our direct retail platform and our private equity secondary business.

And in areas with clear future potential, we provide targeted seed funding. For example, in digital assets and channels. This approach to resource allocation sounds simple, but few firms execute this with discipline at scale. This discipline has created significant operating leverage for us over the last 3 years. On asset gathering, we have delivered net new asset growth materially above market for 3 consecutive years, with around EUR 100 billion in total net flows driven primarily by our great extractors ETF franchise.

On asset gathering, we have delivered net new asset growth materially above market for 3 consecutive years with around EUR 100 billion in total net flows, driven primarily by our great X-trackers ETF franchise. All of this growth was delivered while reducing costs each year even during inflationary periods. We separate costs into volume-based good costs like custody or index fees that increase as we do more business and discipline-based expenses, which is everything else. While volume-based costs rose due to growth, we actually reduced discipline-based expenses.

So overall, costs came down by 1% per annum since 2022, strengthening operating leverage. At less than 60%, our cost income ratio is comfortably within the top quartile of our peer group and continues to trend lower. Our profits have grown strongly with profit before tax up 50% since 2022. These decisions build the foundation we have today, and we continue to apply the same discipline as we look ahead.

We operate in highly attractive markets with structural growth. Industry assets under management are expected to compound at roughly 8% over the coming years, supported by long-term wealth creation, retirement needs and the increased adoption of professional investment solutions.

Let me break that down across the key market drivers, in particular, ETF and alternatives and the evolving client preferences of both institutional and retail audiences. We see a distinct shift from higher fee active strategies towards lower fee passive products, particularly ETFs. While this has led to overall margin pressure in the industry, we are well positioned to manage and benefit from this evolution in client demand.

We are one of the leading ETF providers in Europe with a market share of approximately 11%, and we have steadily increased our market share over the last few years. In Europe, our broad offering positions us as an ETF supermarket. In the U.S. and APAC, we focus on thematic ETFs rather than competing head on with the largest index providers. That approach plays to our strength and client demand.

At the same time, we are actively building higher-margin areas. A core part of that strategy is private markets, where we benefit from well-diversified origination channels and a proven track record across cycles. We have more than 50 years of experience in real estate and over 25 years in infrastructure. Infrastructure continues to scale. And in real estate, we are seeing renewed momentum. We're expanding our teams and are actively fundraising in both areas. We are also building out private credit in Europe, focused on asset-based finance and real economy lending. We're doing this in partnership with the Corporate Bank and the Investment Bank, benefiting from Deutsche Bank's strong underwriting expertise.

Let's move to changes in client preferences. Approximately 1/3 of our ETF AUM now comes through digital platforms, and we continue to broaden digital savings channels and scale higher-margin active ETF solutions. For institutional clients, we're increasingly looking for outcomes, not products. We're expanding our solutions business, supported by our breadth across public and private markets. These capabilities are difficult to build.

ETFs demand scale and distribution, private markets require a proven track record. Institutional clients value holistic solutions and retail clients expect a broad and digitally enabled product set. Everyone wants to create a platform like this, but our ability to deliver across all of these fronts is quite rare and not easily replicated.

Now I want to outline how our strategic priorities actually translate into tangible actions. First, we aim to be the gateway to Europe for global investors. As Europe undergoes a major industrial and energy transition, global capital is seeking exposure, driving growing demand for our existing broad product set. Building on this momentum, we are also launching new products and are strengthening our presence in key growth markets, including our recent office opening in Abu Dhabi.

Second, we aim to be a top 5 foreign asset manager in each of the world's top 5 economies. Germany remains our anchor where we are strengthening our leading position and are well placed to benefit from upcoming pension reforms through scalable long-term retirement solutions.

In China, we hold 30% of Harvest Fund Management, the country's fifth largest asset manager. In India, we recently announced plans to enter a strategic collaboration with Nippon Life India Asset Management, focusing on alternatives, ETFs and global distribution. In Japan, our long-standing partnership with Nippon Life continues to deepen. And in the U.S., we are already the sixth largest foreign asset manager with future growth in focus.

Third, we're investing for the future of finance. In digital assets, we have translated a bold vision into tangible progress. Our joint venture AllUnity, launched EURAU, the first fully regulated euro-denominated stablecoin out of Germany, a milestone in our approach to digital assets.

Going forward, we will continue to broaden our crypto capabilities, develop further products around AllUnity and prepare to tokenize our first fund. On the client side, we are building embedded investment solutions through an API-driven model, aiming to connect investors seamlessly to products wherever they want to invest. We will apply artificial intelligence across our investment process, leveraging decades of proprietary data and the cumulative decisions of nearly 1,000 portfolio managers.

We will also enhance real-time data infrastructure and deploy an AI investment companion to support and challenge portfolio managers, helping to elevate disciplined insight-driven asset management. Together, these initiatives differentiate DWS and will embed us more deeply into the digital architecture of our clients and the broader financial system.

Now the progress you see in our numbers is not the result of one-off levers. It reflects a multiyear effort to build a platform that can scale efficiently and support sustainable growth. We have systematically simplified and strengthened the firm. We've made targeted investments in our operating model, streamlined structures, further developed our enabling functions and build up teams in India and the Philippines, creating scalable, cost-effective hubs.

At the same time, we are focused on developing talent from within. On the one hand, we quadrupled our graduate intake and increased our training budget, while on the other, we are limiting external hiring. So together, these measures are deepening our capabilities organically over time. And it is worth underscoring that Asset Management is a talent business. Sustaining performance means investing in people, not cutting compensation.

Our portfolio manager retention is strong, and we continue to invest to make DWS a place where the best people want to build their careers. Alongside internal developments, we've made targeted strategic hires in areas where we see long-term growth, including critical hires in alternatives, enhancing our X-trackers ETF platform, expanding our sales force and investing in our digital capabilities.

Importantly, all of this investment has been self-funded. We've now reached a level of maturity where no additional structural investment is needed. From here, the only costs we expect to rise are volume-based, the good costs that naturally increase as assets grow. Of course, we'll continue to invest, but our investments will be self-funded through efficiency gains. We will focus on the areas in highly attractive parts of the market where we already have clear competitive advantages.

Our utmost priority is maintaining our leading German retail franchise. In addition, we're accelerating growth in X-trackers and alternatives where client demand and our capabilities are both strong. So to summarize, our commitment is clear. Growth investments will be self-funded, which means that the cost base is essentially staying flat, except for the good costs. On this basis, we remain confident in maintaining a cost/income ratio below 60% and delivering 10% CAGR in pretax profit through 2028.

Now in addition to our own capabilities, being part of Deutsche Bank Group presents a significant competitive advantage. We have 3 major divisions of the Global Hausbank as partners, and this gives us access to origination and distribution that most other asset managers simply do not have at scale.

The Private Bank remains our #1 distribution partner globally. And together, we are jointly building investment products, including our recent alternatives ELTIF. For both the Corporate Bank and the Investment Bank, we see material upside in cross-selling to clients. In Germany, specifically, that collaboration extends to developing comprehensive pension offerings across all pillars, an area where we see significant long-term need and opportunity, as Christian has outlined. And when it comes to private credit, this partnership will give us preferred access to origination.

On the corporate bank side, that means asset-backed financing and SME lending. On the Investment Bank side, it covers a variety of private market assets from direct lending to more bespoke special situations within FIC financing. Having started my career in FIC and having overseen the corporate bank for a few years, this is a partnership that is very close to my heart. And while we are seeing good early momentum, the opportunity remains significantly larger. So what will this strategy deliver?

By 2028, we will aim to have cumulative long-term net flows of more than EUR 160 billion. This will translate to compound revenue growth of around 5%. Furthermore, we are confident to achieve 10% CAGR in profit before tax through to 2028. And we will deliver a strong return on tangible equity of more than 40%, consistent with our scalable business model. We can deliver on these ambitions because we have a diversified proven business model underpinned by strong product capabilities, deep distribution reach and scalable platforms. These strengths have enabled superior earnings growth in recent years, and we intend to build on that momentum as a leading European asset manager with global footprint. Thank you. And I will now hand over to Ioana.

Thanks, Stefan. So we will now take a short break for about 20 minutes. So please return to your seats at around 3:10, where we will hear from Fabrizio and Raja followed by the Q&A session. Thank you.

[Break]

Please welcome Head of the Corporate Bank and the Investment Bank, Fabrizio Campelli.

Hi, everybody. I'm Fabrizio Campelli. I'm the Head of the Corporate Bank and the Investment Bank. And I will start with the Corporate Bank. This is the business that sits at the heart of our Global Hausbank. Today, we believe we are best placed to capture the opportunities in Germany. We have a wide global network and a distinctive set of cross-border capabilities. And yet we still have substantial value to unlock through greater scale and bank-wide synergies. With our solid foundations, we can go further, working with our clients to make us an even bigger engine of profitable growth.

The Corporate Bank is the clear leader in Germany, Europe's largest economy and the world's third largest exporter. We are one of the few truly global corporate banks, and we have an attractive business mix. We offer platform and flow services across multiple client segments from SMEs to multinational corporates and global institutions to governments.

Geographic mix is also a strength with over half of our revenues generated outside of Germany. And as importantly, our 5 subsegments are divided into 4 sticky capital-efficient businesses like business banking, cash management and payments, trust and security services and one business, trade finance and lending, which while more capital intensive, is deeply strategic for our clients. This combination of deep domestic market access, global connectivity and bank-wide client access is unique amongst peers and highly valued by our clients as demonstrated by our competitive position in euro clearing, global Corporate trust across developed and emerging markets.

While the domestic market strengths of the Corporate Bank are easy to understand, sometimes that is -- something that is perhaps not as well appreciated is the power of our global network and reach, both in our physical presence around the world as well as our penetration of cross-border corridors.

Today, Deutsche Bank is physically present in around 60 markets around the world and can reach over 140 markets through a correspondent banking network. We provide direct clearing to over 65 countries, giving us a competitive edge in global cash management. We are the top euro clearer in the world and the top clearer of U.S. dollars amongst Eurozone banks. Our emerging markets credentials are also first class. We are the #1 nonlocal provider of cash, trade or security services across 18 Asia Pacific and Middle Eastern markets, including a leading position in China, India and Saudi Arabia, and we continue to gain ground across more emerging markets.

And moving to cross-border capabilities. Today, we are a clear leader in both the German inbound and outbound corridors for trade finance and cash management globally. We execute the equivalent of EUR 250 trillion of cross-border payments across more than 130 currencies every year. And we support institutional client flows with in-depth local custody access to over 30 markets worldwide. And as you heard from Christian, we have EUR 4 trillion of assets under custody. As a result, more than 1/3 of our large corporate and financial institution clients generate cross-border revenues with us. And all this gives us a deep understanding of international trade and payment flows, regional corridors and related client needs.

With global connectivity being redefined, a corporate bank with these characteristics has a genuine competitive advantage. And as the only non-U.S. bank offering this broad mix of services around the world, you can see why we see ourselves as ideally positioned in today's markets.

Under David Lynn's leadership and before that, Stefan, the Corporate Bank has executed a profound transformation. In 2021, we earned EUR 5.2 billion in revenues. The business was well positioned to benefit from rising interest rates. And between '21 and '24, revenues grew to EUR 7.5 billion on the back of considerably higher net interest income, driven by those higher rates, but also a 4% CAGR of underlying growth triggered by actions on volumes, focus on fee income and active repricing.

In 2025, despite headwinds from lower interest rates and a few episodic client perimeter reductions, we expect revenues to be broadly flat compared to '24 at around EUR 7.4 billion. Thanks to the actions we took, we're going to deliver 8% underlying growth this year, doubling the rate of the previous years and outperforming the market revenue pool by 7 percentage points. The measures we took included increasing our client-facing bankers by approximately 15%, adding over 3,600 new large corporate and institutional clients and enhancing our technology and platforms, which led to an increase in deposits, transaction volumes and assets under custody. And we achieved all this with far greater operational resilience than in the past. But there is still substantial further uncaptured value in our corporate bank, and that upside is the focus of our strategy.

Our ambition for 2028 is to cement our position as the European cross-border powerhouse. Our strategy is fully aligned with the 3 pillars that Christian laid out earlier, growing net interest income and fee income further on the back of our existing strength, investing in our operating model and deploying capital more efficiently. Our growth drivers are focused on going deeper within client segments where we already enjoy a strong relationship and wallet share, such as large corporate and institutions and by continuing to invest in consolidating our leadership position in Germany.

We will also invest in acquiring new clients across German business banking SMEs, European mid-caps and in fast-growing segments such as fintechs. We will also collaborate even more closely with the rest of the bank to unlock further value for our clients. Our second lever will focus on investments in technology, keeping the Corporate Bank at the cutting edge of client solutions while continuously improving on costs and controls.

And lastly, we'll continue to enhance our capital efficiency and discipline down to the individual client level. Through these actions, we aim to deliver an 8% revenue CAGR through 2028 at a marginal cost/income ratio of less than 20% and generate EUR 1 billion of SVA accretion.

Let me now share the detail of how we will do all of this. A business as attractive and competitive as corporate and transaction banking requires a strategy that is really closely aligned to where we know we can win. This is why our growth agenda is focused around areas where we believe to have unique advantages, and that is our client footprint, our strength in Germany and adding new clients who value our network and product solutions.

So first, we will deepen product density with our existing multinational corporate clients by increasing the size of our sales and coverage teams. We will also strengthen our institutional relationships by expanding the highly RoTE attractive trust and security services businesses and by growing our clearing penetration, especially for U.S. dollars.

Second, as the only German banks with true global reach and an integrated investment bank, you've heard that we are ideally positioned to leverage the opportunities from fiscal expansion. As global flows in and out of Germany develop, our aim is to act as the natural gateway to the German economy and to be the #1 adviser on the fiscal expansion, especially in the infrastructure and defense sectors.

Our assumptions on how impactful this may be are quite conservative. And also, as Christian said earlier, there may be additional upside. This focus on Germany is also one of the reasons for our decisions to realign the Corporate Bank leadership to Germany with Michael Diederich, who joined us last summer and a recently announced co-head, Ole Matthiessen, who will relocate from Singapore to Frankfurt next year.

Thirdly, our growth strategy will focus on acquiring new clients. This will be achieved by broadening our channel access to SME clients, especially in Germany, rolling out our coverage model across Europe to expand our mid-cap client footprint and by further aligning our product and coverage teams to more European trade corridors and fast-growing client segments. Another growth lever will be to further unlock the power of the Global Hausbank. Across the Corporate Bank and Investment Bank today, we reach around 850,000 clients globally, 25,000 of which we jointly cover, accompanying them through their entire life cycle from payments and currency hedging all the way to advisory.

Over the past few years, we have significantly improved our cross-divisional capabilities by prioritizing connectivity and collaborating more closely with other divisions of the bank. The business we generate as a result has grown materially and the improvements are evident across several metrics. In fact, while the total revenues across the Corporate Bank and Investment Bank are expected to grow at a combined CAGR of 6% between '21 and '25, revenues generated cross divisionally will have grown at nearly twice this rate over the same period.

Between now and '28, we will be even more focused on delivering the untapped value of the Global Hausbank. So for example, by rolling out a single client relationship management system, by further expanding joint coverage across the Corporate Bank and Investment Bank and also by broadening joint product development and distribution initiatives with the Private Bank and DWS.

Our success depends on scaling our operating model. There are 3 elements to delivering this: client experience, continuous innovation and operating leverage. Our investment into client experience will increase satisfaction and fundamentally change our unit cost to serve. We are implementing fully digital processes and workflows to improve every client touch point, simplifying access, reducing operational risk and allowing our staff to focus even more time on revenue generation. For example, we're building tools to accelerate onboarding and credit decisions with new SMEs and mid-caps in Germany.

Moving to innovation. Our ambition is to become a cloud-native data-centric platform, embedding artificial intelligence across the entire client value chain. Enabled by our strategic and scalable technology platforms, we're now investing in expanding tokenization solutions. This is an area in which we have already become a clear thought leader. While we already increased our operating leverage, there is still a considerable opportunity for further cost reductions. And we will continue to simplify, removing a further 20% of legacy applications while continuously rolling out strategic platforms that will enable scale, resilience and even further innovation.

Also, continued focus on strengthening our control environment will ensure the future growth is delivered in a way which continues to be safe and sustainable. We are targeting a cumulative EUR 1.4 billion of technology cash spend by 2028 to continue this business transformation. This is 15% more than we spent over the prior 3 years and includes shifting a significant portion of our development to in-house talent. We expect to see material improvement across several core operating metrics, and this spend is expected to deliver approximately EUR 1.1 billion of annual revenue growth as well as run rate cost efficiencies of more than EUR 180 million by 2028 with further benefits expected in subsequent years.

On the topic of continuous innovation, I wanted to provide some real-world examples of how we invest in cutting-edge solutions for clients across the various segments. In our corporate client franchise, we bank clients front to back, helping them from financing new plans, establishing their treasury processes and even providing stuff with retail bank accounts and pension solutions. Some of the largest corporates in the world like Lufthansa and BMW, they choose our corporate bank for their treasury solutions or their strategic client engagement programs. Many of our mid-cap and smaller businesses clients too benefit from our efficient automated workflow solutions. And we continue to innovate, for example, by cutting their credit decision times from months to days through Agentic AI or by providing integration solution for treasurers to automate their workflows across multiple providers.

We also deliver to the largest global custodians and nonbank financial institutions with seamless treasury, custody, fund administration and risk management services, partnering very closely with the investment bank, as you've also heard on the video earlier from clients such as Blackstone. We are expanding our capabilities here, investing in full-service NBFI hubs with specialized capabilities, but also by rolling out our digitally native cloud-based custody platform across our 30 domestic markets. This will significantly enhance clients' experience, and it will improve our and our clients' cost structure further.

For fintechs and digital platforms, we bank their entire life cycle from founding to IPO and beyond. Services range from virtual account to safekeeping and custody, building on our #1 position within the digital economy in Europe today. Over the next 3 years, we will develop both our distributed ledger product suite as well as our integrated e-commerce acceptance and issuance capabilities to simplify our clients' procurement processes. Our partnership model enables us to co-innovate, partner up and prepare for the future with our clients and in so doing, really cementing those relationships over time.

Over the past 4 years, the Corporate Bank has made progress in improving also its return on capital, but the division has an opportunity to further optimize substantially. Today, our capital-light businesses already operate with a high revenue to risk-weighted assets ratio. Trade finance and lending is the primary capital consumer in the division, and it acts as the anchor for our broader corporate treasury services business. As we seek to continue to improve our return on capital and grow client shareholder value add, optimizing the trade finance and lending business remains a key priority.

Our first step will be to use client level SVA analytics to efficiently allocate capital, enhance collateral management and funding and where necessary, exit non-SVA accretive relationships.

Next, we will reallocate more than 15% of the Corporate Bank's risk-weighted assets towards more SVA accretive portfolio, including those that are linked to the German fiscal expansion opportunity. We will also refocus our trade finance business more towards structuring with an eye on fees and increased distribution benefits, especially in project finance and structured expert credit agency finance.

And lastly, we will keep improving on our balance sheet velocity. And here, we will lean on our distribution-led structuring and broader loan syndication, leveraging also our investment bank's world-class SRT franchise. So we are demonstrating clear progress with our revenue to risk-weighted assets ratio, rising from 9% in 2021 to 12% by the end of 2025, and that reflects both stronger capital efficiency and portfolio quality. But these levers will enable us to go further, and it will propel our return on tangible equity from today's 15% to an ambition of over 20%, delivering the EUR 1 billion SVA accretion by 2028, which I referred to earlier.

So let me conclude on the Corporate Bank by saying we have fundamentally transformed this business, unlocking operational leverage and positioning us for future growth. We will build on our unique global network capabilities, and we will provide our clients with an integrated and modernized offering, focusing on where we know we can win. We are ideally positioned to capture the Germany and European fiscal expansion opportunity. We're using technology to lead our transformation and we'll be disciplined with capital allocation.

For 2028, our ambitions for the Corporate Bank are clear: an 8% revenue compounded annual growth rate, a less than 55% cost/income ratio and over 20% return on tangible equity. If we remain focused on the needs of our clients and ensure they benefit from our full range of solutions, we have absolute confidence that we can achieve all this and more. Thank you.

So last but not least, I will now introduce the Investment Bank. This is the largest of Deutsche Bank's businesses and a cornerstone of our Global Hausbank strategy. It is a formidable business. It has been repositioned since 2021, and it is a true fully global European investment bank powerhouse. The Investment Bank comprises 2 aligned businesses, which have delivered roughly 1.5 percentage points of return on tangible equity increase since 2021.

Our Origination & Advisory business has been repositioned and will be renamed Investment Banking and Capital Markets or IBCM, to reflect more closely the segments it will focus on. Alongside it, we have our world-class FIC franchise, which has been delivering efficient, diversified growth with material market share gains since 2019. This is made of FIC markets, which includes the traditional sales and trading businesses across developed and emerging markets and FIC financing, which provides clients with asset-backed financing and risk solutions across all credit asset classes. These businesses together are the #1 investment bank in Germany, the #1 European FIC franchise in the world and the best FX bank in the world according to Euro Money.

It has grown significantly since 2021 and now contributes over 1/3 of group revenues. Over the past 2 years, the Investment Bank has been transformed. In 2021, the business delivered EUR 9.6 billion of revenues. And in '25, we're forecasted to close at EUR 11.5 billion. From 2021 to 2022, IBCM saw revenues fall as the fee pool declined 34% from its record level in 2021. But since 2022, IBCM has focused on building its position with the existing institutional client franchise and the debt platform while deepening corporate relationships and strengthening our advisory business.

We did this by concentrating on our strength. A great example is where we've seen a 10 percentage point increase in cross-border M&A as a proportion of our overall activity. We have also invested in improving our position in Europe beyond Germany, for example, by hiring advisory and coverage teams in Italy, the Netherlands and across industry sectors as well as through the acquisition of Numis, right here in the U.K. Across the key countries I'm showing there, the investments have led to a 1 percentage point growth in market share since the end of 2022, something that we will continue to develop as the investments we have already made and the bankers we have already hired will further establish themselves.

As a result, our revenue growth has outperformed the fee pool over this period by 26 percentage points, and we believe there is still a lot of value that we can unlock. For FIC, we have seen a truly outstanding performance. Going back to 2020, our market share growth has been over 2 percentage points. And since 2021, there's been a focus on steady diversification with the development of the global macro businesses leading to a growth in market share here of over 1.5 percentage points. We have a best-in-class client franchise with products spanning from flow credit through to structured credit.

Our workflow solutions help our clients achieve more accurate and better price effect execution as well as a more consistent, sticky, repeatable revenue base for us. And we operate across the entirety of Deutsche Bank from a dedicated and increasingly productive FIC coverage group within the Corporate Bank to targeted initiatives with the Private Bank. Importantly, this has been achieved with very, very disciplined cost, risk and capital deployment.

Our vision for the Investment Bank is to continue on the path that we have set to date. Our strategy here is again, fully aligned with the 3 levers we laid out before: grow in areas of competitive advantage, scale our operating model in an innovative and efficient way and continue to apply strict capital discipline. For IBCM, this means focusing on our core strengths, Europe, cross-border advisory to build M&A and ECM while maintaining our world-class debt franchise.

In FIC, it will be by enhancing the already outstanding business we have by leveraging existing platforms and adjacencies and deepening our position in the U.S. Importantly, additional growth here, too, will come from further unlocking the full potential of the Global Hausbank with our divisions of the bank. We will also direct investments into our operating model, looking at technology and innovation to support our clients, but also continuous front-to-back automation and process redesign to capture further cost efficiencies.

Here too, relentless focus on the control environment will also ensure that future growth remains sustainable. A feature of this business has been its disciplined use of capital, and we will continue to concentrate on the marginal return at which we deploy new resources by reallocating capital to high-yielding parts of the portfolio, leveraging our leading capabilities and investor network to redistribute risk and increase balance sheet velocity and here too, focusing on SVA at a client level.

We will keep improving with new analytical tools and strict discipline on how our capital is deployed all the way down with every client relationship. Through these measures, we intend to achieve a 5% revenue CAGR between '25 and '28 with broadly linear growth, a marginal cost/income ratio of under 30% and like for the Corporate Bank, generate approximately EUR 1 billion of incremental shareholder value add over this period.

So focusing on growth, I will start with IBCM. We want to develop this business into the leading European investment banking business globally. Since 2022, we have built momentum into a growing fee pool via the investments that I described, and our strategy is to continue exactly in this direction. Under the leadership of Alison Harding-Jones, we are developing a business that will be more relevant and more balanced with growth across all businesses, but especially in M&A and ECM.

By 2028, we expect these 2 product areas to contribute as much revenue as our debt capital market franchise. We expect the fee pool to grow, and we intend to increase our market share on top by concentrating on 3 levers, again, focusing on those areas where we have a competitive advantage. First, delivering to clients our truly global capabilities. Outside of the U.S., our ambition is to have a leading franchise in all of our core markets. In Germany, we will build on our clear leadership. We are best placed to advise clients in our home market where we have privileged access to the significant inbound and outbound capital flows expected from the fiscal expansion.

But in other markets, too, across U.K., EMEA and Asia Pacific, we will target a strong position, a top 5 position, building on the investments I highlighted earlier. The U.S. is a core part of our offering and the largest people, but it is also a very well-banked market. So we will not aim to compete across the Board, but instead focus on investments into sectors which are critical for our existing clients and drive more cross-border activity.

Next, we will sharpen our sector strategy by building strength in 4 core global areas. First is industrials. Industrials and infrastructure are in our DNA. Here, we are already a leading investment bank, especially in defense, infrastructure and aerospace in Europe. Then financial services. Here, we will develop our strong position as the go-to adviser across several subsectors. Then health care, we will further align with our large global pharma clients and invest in biotech and health services. And fourth, technology. This sector is critical to every other sector, and we will focus here on core verticals.

To support our ECM business, we will also selectively expand our equity distribution and leading research capabilities, building on our strength in Germany, in core EMEA markets as well as our presence in the U.S. and increasingly in Hong Kong. And here, I want to be clear, we're doing this to round out our existing equity distribution capabilities, which have already been bolstered with the acquisition of Numis, but this is not a move to reenter equities.

We will enable us to more effectively promote our excellent research products as well as further strengthening our ECM and the wider investment banking franchise. The third lever would be to deepen existing corporate client relationships around advisory while covering a larger portion of the fee pool to acquire new clients. We aim to grow our coverage of the people to around 40%. That's a 5 percentage point rise from where we are today. And as a result of that, we aim for a more than 3% market share by 2028 for the overall business with roughly 1.5 percentage points of M&A and ECM market share growth, something that we see as conservative, but still quite consequential for this business. And we will do so by hiring over 60 senior bankers across all the regions and the target sectors that I just outlined.

In FIC, the strategy is one of continuity, building on the journey that Ram Nayak and his team have navigated so successfully in making the franchise what it is today, a global powerhouse with a client-led, diversified, disciplined and truly client cycle resilient business. From a EUR 7 billion franchise more concentrated in credit trading and financing in 2021, FIC is expected to close 2025 at EUR 9.5 billion in revenue, well diversified regionally and across all businesses.

Our value at risk has declined 30% since 2021. Yet, thanks to relentless focus on risk management, our revenue return per unit of VAR by the end of 2025 will be nearly double. And capital efficiency has been key with revenues growing 7x faster than risk-weighted assets since 2021, leading to a return on tangible equity, which is 5 percentage points higher than back then.

In FIC, we aim to deliver a 3% revenue CAGR by 2028 by targeting investments in selective areas. We will increase the numbers of products we deliver to clients and have a dynamic and targeted coverage structure in place to achieve exactly that. New products and continuous investment in technology will help make this happen. In Europe, this will make us the out and out #1. In Asia Pacific, we want to remain a #3 bank with our onshore network continuing to operate as a clear differentiator versus other international peers. And we see the largest growth opportunities in the Americas, where we will target closing the gap to a #5 position by investing in areas such as U.S. flow credit, securitized products and in LatAm.

Financing is a foundation of our business, and it will remain a key point of focus. We expect to achieve a higher marginal return on revenues on the capital we deploy across the business, offsetting spread compression across the industry and helping counter the impact of risk-weighted assets inflation expected from regulation. Our intention is to improve our product ranking in the U.S. and then from a franchise perspective, increase our Corporate Bank originated client revenues by around 15% by 2028 and raise our institutional client wallet share by another percentage point over the same period.

We have done this in Europe since 2021, and now we will invest to achieve the same in the Americas by 2028. This will cement our position as one of the leading FIC franchises worldwide and the only truly global alternative to U.S. banks in this business. In the Investment Bank, too, the opportunity to leverage the power of the Global Hausbank model is substantial. Closer ties with the Investment Bank will provide a great upside to the Corporate Bank, but the reverse is also true.

The depth of our corporate bank relationships and the coverage across the entire value chain will allow us to expand our advisory, risk management, trading and financing revenues in the Investment Bank as well. Furthermore, joint development can lead to further growth of successful workflow products such as FX for cash. But these opportunities spend well beyond the Corporate Bank, as you heard from Claudio and Stefan before me, there are many opportunities for an even stronger partnership between all of our businesses.

For example, our close proximity with the Private Bank will enable further growth both from deeper access to entrepreneurs, but also for distribution and issuance of structured notes where volumes have more than doubled since 2021. You heard Claudio make a reference to it. And as our direct lending cooperation agreement proves, collaboration between the Investment Bank and DWS enables opportunities across asset origination, distribution and joint product development.

A key point of difference is how we use technology to scale our operating model. Technology and AI are reshaping our product across e-trading with enhanced capabilities in algo trading and API connectivity, but also in new and emerging product areas. We're seeking to use artificial intelligence to benefit our client directly with enhanced data analytics and the development of specific client insights, helping us identify new opportunities with them and for them.

AI will also enable banker and trade workflow automation, creating the efficiency required also to dedicate more time to clients. Efficiency will remain a core priority. As you can see, we're seeking to maintain a very competitive cost-income ratio. But we can do more by simplifying our architecture and through front-to-back process engineering, reducing costs and materially improving our clients' experience.

Decommissioning legacy application will simplify and modernize our tech environment further. And combined with a high reliance on cloud solutions, we will develop new software on cloud-native architecture from the outset, which will lower cost of production.

As I outlined for the Corporate Bank, ensuring that we do this while continuously embedding controls will give us confidence that we can continue to scale this business at pace safely and sustainably. Overall, we intend to spend roughly EUR 1 billion in cash terms on technology evenly split over the years, with 50% of the spend driving revenue growth, 25% enabling efficiency and the remaining 25% ensuring that we remain compliant with our regulatory obligation and enhancing controls. We aim to improve against a clear set of performance indicator as shown, but also to enable an annual revenue growth of over EUR 1 billion and over EUR 120 million of cost efficiencies by 2028 with further savings to be expected beyond this.

In the Investment Bank, just for the Corporate Bank, we have developed innovative platforms and solutions, which give us an edge. This includes Autobahn, our flagship platform, providing clients with direct electronic access to FX markets for over 30 years. HausFX, it's our proprietary FX automation service, which is fully integrated in clients' workflows. And dbSyndicate, which provides debt issuing clients with improved transaction efficiency while reducing risk and execution time frames. These are prime examples of how our Investment Bank delivers embedded, scalable and innovative solutions that integrate seamlessly into the work of our clients.

And the third lever, capital. What has made this franchise so successful has been a resolute focus on capital discipline. Our risk-weighted assets are expected to grow to '28, driven by business growth and regulatory inflation. However, these numbers are net of considerable optimization that we will continue to take place, resulting in us being able to maintain approximately the same level of revenue per unit of risk-weighted assets across the entire business over the next 3 years.

We'll plan to do so by delivering a marginal revenue to risk-weighted assets ratio of 13% on the new business that we generate until 2028. And this will be achieved through a series of targeted measures, including reallocating capital both to and within FIC financing. And as I highlighted earlier, growing our capital-light businesses such as M&A and ECM will continue to improve the efficiency of the overall portfolio.

We will enhance shareholder value add in every aspect of the business with dedicated analytical tool, giving us much deeper client-level insight. And this will help us make better decision on new business for every product and every relationship. It will also make us more deliberate about how we allocate resources to our relationship lending book.

Finally, we will continue leveraging our leading capabilities to distribute risk in our investor network. And this will enable us to continue to improve the return on tangible equity of our Investment Bank to an ambition of greater than 14% by 2028 and generate incremental shareholder value add of approximately EUR 1 billion over that period.

So in conclusion, we expect Investment Bank to contribute around 5% revenue CAGR, operate at a lower than 55% cost-income ratio and deliver a return on tangible equity of over 14% by 2028. This is a truly global, well-diversified and cycle-resilient business, and it is the alternative to U.S. investment banks.

The IBCM franchise has been repositioned, and it will build on its corporate client relationships and capital-light strategic advisory capability without losing the heritage of our debt capital markets franchises. Selective investments in FIC will make our world-class franchise even better with an undisputed #1 position and a top 5 in Europe and a top 5 position in the Americas.

We will continue to free up resources to invest in innovation to drive competitiveness, efficiency and better control. And continued disciplined capital deployment and significant shareholder value-add improvements will underpin the great return of these franchises.

So this concludes my overview of the Corporate Bank and Investment Bank. These are 2 distinct but deeply aligned divisions, truly committed to a common set of clients and truly demonstrating our Global Hausbank in action. Thank you very much.

And with that, I will hand over to Raja.

How are you doing and good afternoon. I'm Raja Akram, and I'm thrilled to be here presenting as the next Chief Financial Officer of Deutsche Bank. When I initially evaluated the opportunity to join Deutsche Bank, I did my homework, as you would expect. I spent several years at Morgan Stanley, another bank that has successfully transformed itself to be a world-leading institution. So I've been really lucky to see firsthand what it takes to be a growth-oriented shareholder value-creating organization.

I had -- my initial outside in assessment of Deutsche Bank was that this was a bank that has successfully stabilized itself, but was still transforming itself under the leadership of Christian and James. But I have to say I was very pleased with what I found.

Deutsche Bank is now a bank that is now ready to be bold and be the European champion. The extent of our capabilities here and the upside potential exceeded my expectations. We are strategically placed to be the Global Hausbank. And from my own perspective, there is no reason why we should not be punching above our weight in the years to come based on the solid foundation that we have laid.

Now I've spent the last several weeks stress testing all the assumptions and the scenarios that I will be presenting to you today. But before I lay out the path ahead, I just wanted to share some thoughts with you as I come new into this organization. These thoughts are my guiding principles, and I'll have a relentless focus on these. So what are they?

Number one, we're going to have complete and clear business position discipline. We'll only invest in those businesses and markets where we can win and can be amongst the leaders. Number two, they must fit our strategic profile. Number three, we must have strategic patience. We're setting long-term objectives. We must stick to them with conviction and measure our progress with rigor. And lastly, we must be ready to take advantage of artificial intelligence, the German fiscal stimulus, the changing demographic of our workforce and the need for retirement savings. It is with these principles that we will chart a path ahead.

Now I'm actually super excited to work with this entire management team to deliver on each one of these goals, and I look forward to sharing the progress with you all on a regular basis. From my perspective, what this team has accomplished over the last few years should give us all a lot of confidence in our ability to deliver.

So this is the way we think about our path forward. In the near term, we intend to accelerate growth by focusing on those businesses with high earnings potential and the ability to capture market share. Now is the absolute right time to prudently invest if we want to harness the full power of our franchise and to take advantage of the macro trends. We have aligned all our investment plans to our strategy and developed success criteria and milestones.

Then in the medium term, we will be driving towards higher return on tangible equity and earnings as well as an improved balance sheet productivity. All of this will be done on the back of the positioning we have and the investments we're making. While we're investing with extreme discipline, we will continue our utmost focus on our resource consumption, both expenses and capital. And in the long term, our ambition is to become the undisputed European champion with market-leading returns.

Christian has set out 3 levers to our strategy, focused growth, strict capital discipline and the scalable operating model. So let me now lay out our financial targets relating to these with absolute clarity and conviction. Our baseline target is a greater than 13% return on tangible equity by 2028. This will be accompanied by our ambition to deliver a revenue CAGR above 5% as well as a greater than 100 basis points improvement in revenues over RWA. And we target a gradual and consistent reduction in the cost-income ratio reaching below 60% in 2028.

Now it goes without saying that all of this will be done while maintaining complete financial resilience around capital and liquidity. And our CET1 operating level of 13.5% to 14% remains unchanged.

Now you've already heard from all 4 of our divisions about how they will unlock shareholder value in line with the guiding principles I laid out at the beginning. In fact, the shareholder value we aim to create over the next 3 years is expected to be around EUR 1 billion each from the Private Bank, Corporate Bank and the Investment Bank with meaningful contribution from Asset Management.

I want to reiterate another important data point. By 2028, we expect more than 70% of our tangible shareholders' equity to be allocated to business units exceeding our internal hurdle rate. My 3 partners, Claudio, Stefan, Fabrizio have set out detailed plans and the progress towards these objectives will be tracked via a set of performance indicators.

As you can see on the right-hand side, all divisions are aiming for double-digit returns on tangible equity. And this will support our greater than 13% return on tangible equity target at a group level despite excess capital we hold at Corporate & Other.

Let me now turn to group financials. We are aiming for 2 things: one, growth; and two, consistent improvement in financial performance over the medium term. The focused growth areas Christian introduced should drive continued momentum. Combining this with our cost discipline, we aim to deliver significant positive operating leverage. As a result, profitability should improve and we intend to deliver a higher return on tangible equity and unlock shareholder value every year, not just at the end of '28.

I want you all to take away 3 key messages from this page. First, and on the left, you can see how we expect our focused growth areas to make an outsize contribution to our CAGR of around 8%. They should deliver EUR 5 billion of incremental revenues by '28, taking overall revenues from EUR 32 billion to around EUR 37 billion over a 3-year period. Now as a leading bank in Germany, around EUR 2 billion of this growth should be generated via our home market, with around half of this stemming from the German fiscal stimulus.

Second, divisional growth should also be balanced. And as you can see in the pie chart in the center, with around 70% from the Private Bank, Corporate Bank and Asset Management. The remaining 30% from the Investment Bank includes our powerhouse FIC franchise, which will be a continuing strength for us.

Third, as you can see from the smaller pie charts on the right-hand side, we expect that approximately EUR 2.6 billion will stem from net commission and fee income. And we also expect around EUR 2.3 billion from net interest income across key banking book segments and other funding. Remaining income includes revenue from our trading activities, which is expected to be broadly stable.

Now let me turn to NII, which is a key component of our conviction on future revenue growth. Our structural hedge will continue to provide a long-term tailwind to our interest income. As we replace the hedges entered into low historical rates, we expect around EUR 1.2 billion of NII growth between '25 and '28. And we anticipate further interest income growth from the expansion in our balance sheet. We expect a majority of this NII growth to come from deposits as we take full advantage of our market-leading franchise in Germany.

Loan growth should also contribute a meaningful share, but we make some allowance for margin compression, especially in FIC financing. And in the Private Bank, you should expect to see some shifts from retail lending in Personal Banking towards Wealth Management. And in the Corporate Bank, we are very well positioned to benefit from the fiscal expansion in Germany and expect increased lending opportunities, particularly in infrastructure and defense.

Now let's focus at our cost trajectory over the next 3 years. Our ultimate goal is to create a scalable operating model and deliver an operating leverage of around 6% in 2028. The investments we have talked about will provide the forward-looking capabilities needed for accelerated revenue growth and the structural cost takeout.

The operating efficiency was of at least EUR 2 billion should offset the incremental investments of EUR 1.5 billion and some of the volume-related and inflation costs. These efficiencies will be an output of both new investments and those we have made in the prior years. We also intend to execute additional targeted efficiency programs where we believe we see a path to being best-in-class. As a result, we aim to deliver a material improvement in cost-income ratio targeting below 60% in 2028.

And let me add one more important detail, which will form part of our journey. We expect approximately 20% of our global workforce to reach their retirement age over the next 10 years, ramping up from about 1% per year in the coming years to more than 2% in the early years of the next decade. Of this, nearly 3/4 are in Germany and are naturally more senior and more highly compensated. While we need to be mindful of the skills and the experience leaving the bank, this also represents enormous opportunity to deploy technology and AI and have a new workforce strategy. This should achieve a meaningful reduction in costs over time without the need for expensive restructuring.

Let me now zoom into 2026 before I move into divisional details. What I want you to take away from this slide is that the targeted and incremental investment we're making over the next 12 months should unlock growth and efficiencies as early as next year. These include both technology and AI, which are future-proofing the bank and business-led investments. And we are doing this without compromising our overall cost-income efficiency ratio, which we expect to remain below 65%. Excluding business-led investments, our year-on-year expense base should only increase by 1%.

Now you have heard from the various businesses about their plans, and this page brings it all together. On the left, you can see the breakdown of the EUR 1.5 billion of incremental investments by division with 70% of nontech investments geared towards the Private and the Corporate Bank. We will also make targeted investments in Fixed Income and selected sectors in Investment Banking, as Fabrizio laid out earlier.

We are incrementally investing starting in 2026 and we aim to offset this with a EUR 2 billion of operational efficiencies. These come from front-to-back optimization, process reengineering and an improved IT infrastructure. As you can also see, a large proportion is geared at initiatives across our infrastructure functions. And on the right-hand side, the potential revenue benefit in 2028 over 2025 is greater than EUR 3 billion. This entire management team has high conviction in this plan that we need to invest now to take advantage of the market opportunities we see.

We have talked a lot about shareholder value add today. One key aspect of this is our capital consumption. So let's discuss resource deployment. Our balance sheet management will focus on redeploying financial resources from areas that don't fit our strategic agenda and instead grow capital-accretive businesses. We intend to complement these efforts with additional asset distribution, synthetic and cash sales. Now as you know, discussions are ongoing on changing the FRTB implementation time line to ensure European banks can compete on a level playing field. But for now, we continue to plan for an impact of EUR 7 billion of RWA in 2027 or around 25 basis points in CET ratio terms. And let's not forget that an optimal capital usage also includes the supply side where capital deductions will be carefully managed.

We expect our CET1 ratio to remain strong throughout, providing the basis for increasing shareholder distributions, and we continue to expect no impact from the CRR output floor until 2030.

Our plans are intended to at least to boost and improve capital and balance sheet productivity. First, we aim to redirect RWA deployment to SVA-accretive areas, including capital release from potentially inorganic measures. Second, we aim to translate the higher return [ aspiration ] into higher return on equity hurdle rates for products across divisions.

Third, we plan to expand our originate-to-distribute capabilities beyond current platforms. We expect at least 25% of additional capital relief from risk transfers and securitizations programs for assets for which are capital intensive for banks, but very attractive for investors.

Linking it back to our divisional ambitions and our strategy, the focus growth areas are expected to improve by 400 basis points on revenues over RWA, significantly contributing to the expected 100 basis points uplift at the group level. And as Christian has said, the actions we're taking in our new plan mean that you can expect a materially improved franchise. A substantial majority of our business units should exceed internal hurdle rates by 2028 with more than 70% of our equity allocated to shareholder value-creating activities up from 40% in 2025.

The charts show that transitions from below to above hurdle rates from 2025 to 2028 for the various businesses. And we believe that over time, this proportion will increase. This will support our path to our return over tangible equity target of 13% at a group level by 2028.

Maintaining financial discipline is another theme you have heard about today. Let me be crystal clear. Maintaining a strong capital position, strong liquidity profile and a robust balance sheet is completely non-negotiable. The past has shown these provide our clients and broader stakeholders with comfort and confidence in engaging with us. As far as provision for credit losses are concerned, the improving German macroeconomic backdrop, normalized CRE-related losses, along with our portfolio supports a lower CLP run rate of 30 basis points through '28.

Robust and targeted loan growth will be supported by absolute underwriting discipline, and we want a strong diversified loan book. We aim to continue to protect ourselves from the downside having built up hedges in the past and with the plans to continue to do so.

Let me now turn to our principles of capital deployment. We will cautiously monitor all our capital and liquidity buffers to withstand adverse macroeconomic developments in a world where uncertainty has become the norm rather than the exception. With this strong foundation, we want to carefully balance and increase shareholder distribution, both in dividends and share buybacks.

And only where we have high conviction and a clear opportunity, we will invest organically in targeted businesses with strong market positions and scalable and predictable earnings potential. And if we do decide to pursue inorganic opportunities, it will only be done if they make sense strategically, financially and culturally. Our capital deployment plans have dual objectives, safety and soundness while maximizing shareholder returns.

Now to my favorite slide. With the renewed confidence we have in our plans, we intend to increase our payout ratio, raising it significantly from 50% of net income to shareholders to 60% in 2026. Also, we want to deliver modest but continuous growth in dividends per share with buybacks achieving the balance of distributions. In aggregate, this means that investors should see a 10 percentage increase and a more predictable stream of ordinary distributions earlier. This positions Deutsche Bank amongst best-in-class in peers in Europe.

And when the CET1 ratio is sustainably above 14%, in line with the capital deployment framework I just laid out, we aim to deliver either additional shareholder distributions or deploy excess capital to support value-accretive growth opportunities. Ultimately, our earnings and distribution plan should also continuously grow tangible book value per share, and we expect a double-digit percentage growth by the end of 2028.

Before I move to our targets, I wanted to reiterate some points which Christian made about certain trends that are not entirely within our control, but are beneficial to us. But it was a deliberate choice not to incorporate these in our base plans because we want to deliver our targets regardless of the eventual outcomes here.

First, the pace and the scale of German fiscal stimulus and the structural reforms where accelerated loan growth in defense and infrastructure would particularly benefit us. And I could foresee our revenue growth rate being in excess of 6% if that happens.

Second, if you can learn anything from tech history, it is that technology grows exponentially. So the benefits of tech and AI could well exceed what we have modeled having a direct impact on the cost base and the EUR 2 billion of savings we are targeting.

Third, the savings and investment union offers immense potential to ease capital flows and capital rotation. We could therefore see higher fee income. And finally, we are already seeing European regulators and politicians in Germany acknowledging the need for reforms to spur growth and level the playing field with U.S. peers. For example, recalibrated capital buffers or administrative requirements could improve capital efficiency. However, when comparing us to U.S. peers, one should also consider other regulatory differences such as the capital treatment of software.

Let me add one more point from my heart and experience that is actually not on any of these pages. For many years, this management team's attention has been on resolving legacy items and foundational capabilities, which also impacted with the directed investment spend in the past. Now we find ourselves with an opportunity to have a full focus on growth and competitiveness while staying resilient. Based on my prior experience, this in itself is a massive tailwind. So we have the conviction to target a greater than 13% return without the benefit of any of these developments, but we are ready to capitalize on all of them.

Let me conclude with the 2 clear financial targets we have set. One, a more than 13% return on tangible equity; and second, a cost-income ratio of below 60%. At the same time, we are steadfast in our capital objectives, maintaining a strong operating CET1 ratio of 13.5% to 14% and delivering attractive shareholder returns with an increased payout of 60%. We are confident in these targets and objectives because of the strong and stable platform we have built over the last few years. The divisions have shown how they intend to build on that at scale with greater efficiencies and an absolute focus on those areas where we can best add value.

All of this adds up to a very attractive plan for the future. It is an achievable plan and one with immense discipline at its core, but it is also planned with potential for considerable upside. The foundational work has been done. With a plan for focused growth, strict capital discipline and a scalable operating model, we are well positioned to take advantage of the macroeconomic backdrop and the AI revolution.

On a personal level, I'm very excited to become part of this exceptional team, and I want to thank my partner, James, for such a smooth transition. So this is our collective path. Together, we plan to deliver lasting success for Deutsche Bank's clients and shareholders. Thank you, and we look forward to starting the Q&A shortly.

[Operator Instructions] And with that, let me invite our speakers back on stage and let's get started.

So I think we've got our first question from roughly the fourth row. Your mic should be green if you're live.

So Chris Hallam from Goldman Sachs. First and foremost, I guess, as a team, you've got to this target of greater than 13% for 2028. Perhaps you could just run through some of the puts and takes, some of the challenges and opportunities you see embedded within that target and the scope for performance if indeed there is some. I guess, sort of what's the bull/bear debate been behind the scenes for the past few months in getting to that above 13% target?

And then secondly, on costs in '26, it looks as though the plan obviously envisages an initial step up to maybe just above EUR 21 billion next year. Why is it the right decision to sort of front-load the cost? Why is 2026 the right time to invest in OpEx?

Thank you, Chris. Let me start with the first question, then Raja, potentially you take question number 2 on the cost side. Look, first of all, I have to say that everything what we have planned now going forward for the next 3 years is really based on the foundation which we have built over the last 5 years. More and more since we actually determined that the Global Hausbank is the right strategy for us, we have felt year-by-year with the client feedback that this is exactly what our clients want.

And in particular, in the times where we are right now with geopolitical environment, also actually the franchise feedback from outside Europe to have a European alternative being a global banking partner has confirmed to us this is the right strategy. And therefore, it was all about in the last 3 or 4 months that we started to look at the external environment, growth risks. And then we said, where is actually our opportunity to further grow or where we are not yet in a leading market position that we can get into this leading market position. And that we have done business by business.

Now I can also tell you, Chris, that for the first time, given that we have been in a completely different situation 3 years ago and in particular, 5 years ago or 6 years ago, we have now a plan where I would say it's not only that this is a plan which is fully bottom-up validated. But where we said, look, we even believe that there is more to get but given where this world is and given that we only wanted to plan that where we feel we have that in our hands and we have actually measures which already have been taken either by us or by the external environment, which is put into the plan.

And therefore, I feel that also compared to the past, we have a plan which is actually whether you talk revenues, whether you talk costs and also actually, capital deployment is a prudent one. And that is something where I have to say it's where I can now with all confidence say, Chris, we are now really in the position to play offense. We can really focus on that what is needed and where people want us. That is on client growth, that is on client meetings. And at the end of the day, this will come out for the shareholders.

So I have to say, compared to everything I've seen over the last 7 years since I've taken over as the CEO at Deutsche Bank, this is a plan where I think, yes, of course, we want to grow, and there -- we have increases, but overall, very prudent. And I can see the one or the other potential where we will outperform.

Thanks, Christian. Chris, I think you would appreciate that I actually had the exact same question as I was looking at the plan to myself coming from the outside, where are the puts and takes, where is -- what's the bull, what's the base? What would I do? And I'll tell you what I found was, given the strong foundation and the opportunity, I think if you go to my third principle, which was that we will be ready to take advantage of the upside and the macro environment that we are facing, whether it's investments in AI, it's the upcoming German stimulus, it's the change in the German savings environment or our workforce.

So from my perspective, once you're ready and your organization is ready culturally as well as from the previous decisions, you want to execute. And we do not want to be an organization that continues to play defense and let other people take us -- take the lead even further.

If you take Christian's opening slide from defense to offense, I think we're starting in '26. It's a 3-year investment. And by the way, this is an incremental investment because we obviously have investments in our baseline. We're being very, very selective.

And the other criteria was a lot of these investments are paying off in year. So that made our business case a lot more simpler. One, I'm getting $2 billion in return for investing $1.6 billion over 3 years. Two, the upside is coming from both revenues and expenses. And three, we're getting ready for potentially the upside scenario. And if we don't make these investments, we potentially lose out on the upside scenario.

Next question is to my left at the top.

Tarik El Mejjad from Bank of America. Staying on the thematic of offense versus defense. So on the revenue side, clearly, you are betting on momentum, continuing momentum on deposit growth and also on the FIC business. So on the FIC first, what makes you comfortable to see to grow the business with volatility potentially coming down a bit? I'm interested to hear with you on this.

And then on the deposits, you've been delivering similar kind of magnitude. But this is based on a quite sort of cautious environment from corporates and households. If you expect that to grow, would that just go to lending growth? And then all in all, it is the same targets or you have to rethink a bit your targets?

And second question on capital discipline, RWA growth, 2.5% CAGR, earnings growth is quite healthy. Does that mean you will be overshooting your 14% CET1 quite rapidly? I mean should we be aware of any headwinds coming in terms of capital? And, Raja, how -- you will get the question from all of us every quarter. You are above 14%, should we expect more distribution and when and in what shape or form?

Why don't Fabrizio starts on FIC, then on the deposit side, Claudio and then capital, James and Raja, please.

Thank you. I think effectiveness of the FIC plan we laid out rests on one aspect, which I tried to highlight in our presentation. And that is diversification. We have a very diversified franchise, which is actually no longer as reliant as it used to be on volatility to succeed. I spoke about product diversification. There was a chart in which I broke down how the product composition of FIC is now much more diversified than it used to be. It's geographical diversification, it's segment diversification.

But one aspect that is not properly coming across yet clearly enough is the product, the underlying type of revenue diversification we have. Financing is a business that makes money on NIM carry, so very much nonvolatility dependent.

Workflow Solutions, which I highlighted multiple times, FX for cash and so on, is generating FX volumes and revenues on the back of corporate client activity, an asset manager looking to hedge. Same for rates. And the investments we're making are actually going deeper into gaining market share in a market that even if we were to have a decline in volatility by virtue of gaining more market share, it gives us confidence on the growth of rates we outlined -- I have outlined.

In view on deposits, over the last few years, we did not put much emphasis on it. We've increased the emphasis this year. Together with James and Raja, we laid out a long-term approach to the deposit raising. And then we tested it in the market this year, and we tested it specifically when competitors were coming into the market with aggressive rate to make sure that we have a good sense that the market for them was there before putting so much emphasis on them going forward. And the results were beyond our expectations. And also we're collecting -- as I was saying, we're collecting so much of those deposits from new clients on a digital basis. So it has also a multiplier effect in other areas of revenue. So we remain very confident.

Let me take the question on capital. As I mentioned in my prepared remarks, it is our goal to operate between 13.5% to 14%. That's our operating range. Now with the strong organic earnings generation that we just laid out, we're going to generate capital that potentially will get us in excess of that in the cycle and depending on the bull scenario, that may actually happen sooner than later. So it is our absolute intention to be disciplined and the for -- the hierarchy that I laid out for capital distribution absolutely sticks, which is that unless we see a very, very compelling case for reinvestment, that capital should be returned to the shareholders. And as you know, our cadence is that we typically return capital in the following year after earning it. So depending on where we are at that point in time, we can revisit that, but it is absolutely the intention that anything above 14% should be returned to the shareholders.

I think we're back in the middle. Your mic should be green.

It's Andrew Coombs from Citi. Firstly, I thank you to you all for the slides today. I appreciate all the hard work that goes into these. And as you said, a particular thank you to James given it is a bit of a handover event here. So the bank has come a long way in the last few years. And 2 questions. First one, and I hate to ask this, but Slide 6 of Raja's presentation, I don't want to get a ruler out and measure the bars in terms of the revenues, the RoTE, the cost development per year. But it does look like this is a slightly backwards-looking trajectory. I don't know if that's fair, i.e., there's more revenue growth baked into '27, particularly '28 given the incremental hedge that's in the appendix and also given when the timing of the rate hikes are expected to come through. But perhaps you can just confirm the trajectory and whether it is the same every year or whether it's back loaded?

Sure. I can -- sorry, go ahead.

So second question, just a very broad question for you all about competition. If I look at the NII growth relative to the loan deposit growth expectation, it doesn't look like you're assuming much for NIM contraction, whereas we obviously did see quite a bit this year. Similarly, in the Investment Bank, it looks like you've actually assumed market share gains across the piece. So interested in your thoughts on the industry fee pool and competition dynamics there as well.

Sure. Let me take the first question. I think I wanted to just to reiterate that we expect to show improvement in all of our targets over the next 3 years, which means that we expect to show improvement in RoTE. We do not expect to deteriorate our cost-income ratio despite the investments we're making. And obviously, we indicated a 5-plus percent revenue CAGR. Now that's a 3-year CAGR, but we expect revenue growth accelerating over the cycle as we see expenses also coming down over the cycles because the impact of the investments obviously will start paying off exponentially.

So what I can reiterate is that we expect to show progress on every front every year, not just in '28 -- not in 2028 and '27. Now it could be that the progress is sooner if some of these tailwinds materialize or artificial -- our assumption around artificial intelligence is different than what reality is. Like just to give you an example, we have embedded a 10% to 20% productivity over the period of our software developers and coders. I've seen surveys that says it could be as much as 50%. Once we start on that journey, it could be that my assumption, but what we are committed to is absolutely delivering 13-plus by '28 and absolutely showing improvement on every metric each year going from there.

Now the pace and the acceleration, we will see how it plays out. But our plan is not a plan which basically is flat first year and then a hockey stick in '28.

Maybe on the comment on competition, how to win market share. We've spent a lot of time really thinking about how will we do it. In FIC, the big market share gain we are target is in the U.S. We said from #7 to #5. We have done that exact path before. We started in Asia in credit -- in Flow Credit in '22 and '23. There was a big investment target in that space where we have grown to, as I said, #3 position. In Europe, we were really not very established in Flow Credit in '23. There was a targeted investment that brought us to that very unstable #1, #2 position in Europe, where we really want to firm up our position as #1 in FIC in Europe firmly. And in the U.S., now we have rolled out those investments. We hired [ at Baillie ] last year. We have made targeted investments in Latin America earlier this year. So we have conviction behind that strategy.

In Investment Banking and capital markets, there will be some fee pool growth that will drag everybody else up. How are we going to gain more share there? There are a few dimensions. One is, we have made investments in the last few years. As I mentioned in my presentation, not all of those investments have yet monetized to their full potential. There is still upside in the productivity of bankers, in the productivity of some of the assets we've invested in.

Second, we want to play where we can win, the cross-border potential, Germany. The advantages we have in the sectors I highlighted we want to invest in are anchored to the fact that those are sectors which happen to be quite large. The 4 sectors I highlighted represent about 60% of the global Investment Banking fee pool, but they also have 2 other characteristics. One is they're very cross-border intensive. Those are the sectors in which clients tend to look more across the Atlantic and across the Pacific and so need banks that have that capability. And two, in the Corporate Bank, we already lend substantial amount of balance sheet to those companies. So we have already an access and an entry point to those companies. We are not starting to try to gain access to them.

Lastly, I mentioned investments in equity capital markets and equity distribution. We have a potential that is anchored to research where we can extract more upside in ways that our peers do not have today upside potential too. That's an underexploited platform. We have a great platform in research that we can monetize more effectively, and we can gain better market share if we round out the distribution piece, which is the piece that is missing.

So these are all measures that are really specific to us, play to our strengths, and that's why we believe both in FIC and in Investment Banking and capital markets, there is market share potential to be gained for us.

And maybe to add, not -- and try not to repeat actually, the current geopolitical situation, for example, in Wealth Management, I'm referring to specifically, it is actually playing fundamentally to our strength. There's always been the need for ultra-high net worth family for proper diversification. They always wanted to have more than one bank. But now there is a clear, I would say, almost universal need to have, of course, one U.S. provider, potentially one Swiss provider, but definitely have one European provider.

And when you're talking about back to the point that Fabrizio was making that we made, I think all of us across the presentation, focus. When you focus in this case, I think about really the top end of the ultra-high net worth, more sophisticated segment, these are counterparties that want the European financial institution as a partner, but it also needs to be global. It needs to have an Investment Bank. And if it comes also with a Corporate Bank, and they are well connected, well, that's a party. And that -- if you put those conditions one after the other, you will quickly find only one name at the end of that equation and that's Deutsche Bank.

On the retail side, on the deposit side, I said already something I won't. But I would say, in the past years, we've done less. What we're doing now is -- I would say what we aim to do is reasonably conservative and is based on evidence. So we took a number, we tested it. We got a better number out, and we kept originally the number that we had in mind. So we are quite confident.

I'll just add one thing quickly. In both CB and PB, there are some long-dated low-margin assets that run off over time. That helps the NIM.

I think the next question is from that side.

The first is coming back to Slide 6, please. So you show the ROE path gradually -- is your ambition that the ROE gradually increases every year? And then in terms of if the 5% revenue growth doesn't come in, are you cutting back on your investments in order to deliver the 13% RoTE? The second question is more -- you talk a lot about collaboration across the different divisions. And if you can talk about why hasn't it worked in the past? How do you incentivize people? And do you have KPIs to measure that?

So why don't I start with regard to your first question and then you can get more details from Raja or James. Number one, we have a gradual improvement. So it is not that we are operating with a hockey stick in the year 2028, but also we see clear opportunities in all the businesses as the colleagues have presented and we want to take these opportunities and therefore we invest more in 2026, but nevertheless, we will have an operating leverage in 2026.

We will also show a higher RoTE in 2026 than in 2025. Clearly, we want to improve year by year and we see now the opportunities and therefore we are investing. Number two, with regard to the cross collaboration. Look, this is a long-term journey and we have to be clear this bank had a past of silos and the more actually we see the strengths of this Global Hausbank, the more we see that we can connect clients, the more actually we see this collaboration.

And there are great examples which is still defined by people in certain regions and that is what we are now rolling out globally. But I think since we have given us this purpose two years ago that we are saying that we want to deliver in each and every client meeting the whole of Deutsche Bank to the clients, I can see a considerable change and I think this is one of our biggest untapped potential for the future and it still happens.

To be honest, if I talk so to say from my day-to-day experience that I am seeing clients, I am trying to see 200 clients plus in the year. Now it still happens that I get a visit preparation for a corporate client where actually there is no connection made to Asset Management or the Investment Bank and this needs to go into the mindset of cross collaboration what we are forcing in and therefore, actually we have said that the first big lever of raising our revenues is to deepen the relationship with existing clients.

Fabrizio has corporate clients where our crossover ratio is at 6 or even 7 and then you have seen a slide that out of 850,000 clients, we have 25,000 clients where we have, so to say, a deep collaboration and this is actually what more and more we will make use of and in this regard, last but not least.

The external environment is obviously playing into our favor, because the most asked question I get with each and every client, whether it is a mid-cap client in Bielefeld or a DAX-40-client in Frankfurt or Munich, it is all about risk management. It is all about risk management. And when you have the risk management question, there are only few banks who can deliver on that.

You need the day-to-day banking needs, which we clearly have in the Corporate Bank, but when it comes to risk management you immediately need the Investment Bank and that together makes us so strong and therefore I think this collaboration also with the change mindset in this bank, I think is the biggest potential we have.

Thanks Christian. I am just going to add 30 seconds on this one. I think the power of an integrated firm from my own background is immense and that is why the Global Hausbank concept that when I came here and I saw that, that was the first thing that struck me as how does this house work together? And I think we are on it, and I think you can expect to see that growing.

Now to your other question, I will take you back to my guiding principles. I did not set up too many, but one was strategic patience, right? Strategic patience means that we are setting long-term objectives, we got to stick with them with some conviction, but obviously we build this plan with prudent assumptions. We did not build this plan that at the first sign of crisis we throw away our entire plan and start all over again.

What we will be doing will be monitoring the external environment, we will be monitoring the revenue trajectory, but more importantly what we will be monitoring is the performance indicators that I have asked each one of my partners to lay out to make sure that the investments are paying off and setting up us for the revenue growth that we will see when it is done.

So what we will do, will have absolute discipline around every incremental spend of dollars. So that if we need to revisit that, we have all the data to do that. But my hope or my aspiration is that we will actually stick it with them in conviction and deliver the targets of 13 plus percent because that is the end game. The end game is not just delivering 2026 by starving ourselves.

So allow me to add a couple of things on cross-sell. Okay. Otherwise, it wouldn't be a good demonstration of collaboration. So look, having been at Deutsche for 23 years, I think I have been part of at least 23 cross sell initiatives and typically if it is like a forced top down, you got to work to it together. It typically does not work. So, it needs to come down to culture.

You do need accountability on who is actually educating whom and then there will be specific situations when you do have revenue share. So if you start with culture, I actually enjoy spending time with Fabrizio, with Claudio, our management team spends lot of time and sometimes just with familiarity and understanding each other challenges, you do find new ways of working together.

Secondly, in Asset Management, we actually have people that are tasked to make sure that the other divisions stay on top of what is important to us and vice versa. So you need to -- even good people, you need to have some accountability on who is educating whom. And then obviously we have very formal engagements. So, Claudio has open architecture, so I do not know benefit from any captive distribution.

However, it is a very formalized relationship in which we do have revenue share. The same when it comes to private credit origination, Ram Nayak and other people would like to help. However, we also have a very formalized revenue share, but really that combination of culture, some accountability on teachings and then some formalized revenue share. I think that is what is working very well. But again, there is plenty of upside left.

Maybe just to do one thing that I should not do, which is correct you. You had the assumption in your question it was not working, why will it work? I think let's not leave you with impression that it's not working because in multiple areas, it's actually working better than anywhere else. When I started six years ago, the collaboration with Asset Management was already very, very well established. It is a natural one.

The collaboration with Ram and his team in the distribution of its products and all of its capabilities was good, but was nowhere near leading. We sat down and work on a monthly basis for the last five years and today we are ahead apart from any other competitors, at least from a wealth management point of view, but I think Ram can say the same from a FIC point of view. We have a level of integration and distribution to clients that is being copied by others.

Now we will do the same in corporate banking. Again, we're not at zero in corporate banking, but if you aim for excellence you will always have space to improve and there I think we definitely can do much better, but I think coming also from six years ago from outside to say that there is no collaboration or collaboration doesn't work would be incorrect.

The next question is just from the row behind [indiscernible].

Thank you very much for the presentation. You show a very interesting graph regarding capital allocation versus return tangible equity and one of those large rectangles, one of the largest business is actually not meeting the hurdle and you expect it to meet it in 2028. And just a question, what happens if you do not actually meet that hurdle?

Because you mentioned strategic patience and you also mentioned the fact that you will be ready to exceed any business that does not meet actually this hurdle. So how long is the strategic patience is the first question.

And then regarding your NII trajectory and the structural hedge roll over, I think you have EUR 1.2 billion of additional NII revenues from the structural hedge roll over and you expect to keep the full amounts by 2028. And just wondering what is your beta assumption and basically what is your deposits competition assumption regarding this?

Let me start on the SVA again and that is what I said at the very start of today's presentation, we are on a journey. So do not believe that with 70% of SVA positive we will end the game. There is a clear determination to go beyond, but I think we again show here that we have a prudent plan and that we take it sort of say, step by step into the right direction.

Will we do better than 70% after 2028? Can we even do better in 2028 than 70%? Yeah, we can, but it is a prudent plan. Thereafter, clearly we want to go higher. Now let me also clearly say that there may be always in a universal bank if you think about divisions, there may be divisions which are not SVA positive, but for the overall client franchise and for the overall client is a super important product and it is a super important capability which we should offer.

And I think again, this is a long-term strategy for the bank. We want to establish Deutsche Bank as the partner for our clients long term. Of course, we need to earn our cost of capital, but there may be the one or the other leading product for instance in the Corporate Bank, partially also in the Investment Bank where we actually saying we can further optimize, but it's not a must, must must that at the end of the day you have a hundred percent hit ratio.

And this is actually also where we are now looking at each client, which is actually covered by the Management Board. We have a transparency of client SVA where we know exactly where we are not earning and then we discuss what are we going to do with resetting the pricing, what are we going to do with the message to the client or is there in the long term over three or four years' time, there's a clear repayment and therefore we lead with this program. So therefore, I think it is, hopefully you see it is a very balanced answer, but clearly 70% is not the end of the road.

I think I have nothing more to add. We obviously applied internal hurdle rates to each part of this calculation and in fact one of the businesses that we actually showed on the page was borderline. If we were having this conversation, maybe at the end of next year, we would've moved over, but we wanted to be honest with ourselves and show the picture the way it is and as Christian said, it will continue to evolve and we'll continue to give our progress update.

To your other question, I think there is a page in the back that shows our evolution of our deposits and loans over the period. Obviously, we are showing a pretty healthy deposit growth and we are very comfortable with that because that growth is coming from all businesses, right? It is Corporate Bank driven, it is Private Bank driven, and based on the success that we have had, we have really high conviction that -- that growth actually is in our hands and that makes us really comfortable.

The loan growth, as you will see if you look at it on a nominal perspective, looks at around 3%, but that also incorporates a lot of the portfolio level work that we're doing in exiting certain portfolios. For example, in mortgages that looks, makes it look a little bit less aggressive.

So I think the assumption of deposits growing 6% and loans growing 3% across the franchise and with the structural hedge in place. That's why when Christian said we have really high conviction on this 5% CAGR because a lot of the NII we feel really, really strong conviction about.

Do you want to say something or...

I was going to just say the product area that you were asking the question about is one of those strategic product areas that are necessary, even if they absorb a lot of capital, they open the door to everything else. However, and this is the very important part of the discipline we want to embrace on SVA, there is not a single product in our portfolio that will not have an objective of growing SVA regardless of whether they make the hurdle or not. The pressure is only upwards and there is plenty we can do to achieve that.

Just briefly, you asked about the betas. Look, we have gone through this period where we were outperforming the betas in both of the big deposit bases considerably and this year we have in essence converged to what our model beta assumptions are. So going forward we expect the same to be the case in the rate environment that we anticipate -- we use implied forward rates both for euro and for dollar. And as you'd expect the euro, the betas are lower and the PB betas are lower. Dollars in CB higher, all built into the models that we shared with you.

The next question comes from my left.

Mate from UBS. Two questions please. The first one would be on Slide 11. You've been flagging EUR 1.5 billion in investments apart from EUR 2 billion in cost-efficient increases and I think you mentioned a EUR 3 billion increase in revenues by 2028 as a result. I was wondering if you could talk about the flexibility both on the investment side and the resulting EUR 3 billion of revenues. What happens if there is disappointment coming through in revenues? To what extent can you actually pull back perhaps some of the investments on increased cost-efficiency?

The other question would be a follow-up on that slide showing the loan growth and the deposit growth. You clearly mentioned that 2% CAGR in loans is really part of the reflection of the repricing and SVA in the Personal Bank in mortgages. If perhaps each of you could talk about where you see upside in other areas, be it in the Corporate Bank, FIC Financing, or in Wealth Management on the lending side that is not captured perhaps in those ratios.

I start in general on the investment side because obviously I think we have shown in the past that, a, there is flexibility; and b, there is extreme discipline in the management team if things not coming through as we expect that we will do something about it. However, I also would really like to stress that what Raja said that this is a long-term plan and we also have a strategic view and it doesn't mean that, so say, if the first 2 weeks in January are not running in the direction where potentially we wanted to have it, that we immediately cut all the investments.

Now can we do this? Of course. And I think we have very, very in a very disciplined way and also in a very successful way shown it over the last 3 or 4 years that if it is needed, this management team will do it. But we do believe actually that now with this foundation, which we have with the growth areas, which we are targeting in all the 3 businesses, that it is really worth to invest and nevertheless, despite these investments have a gradual improvement from 2025 into 2026 and then even more returns in 2027 and 2028.

But rest assured that this management team will not change its discipline on showing results, improvements and we gave you our commitment that we see a year-by-year improvement and that would also mean that if we have to cut, then we will talk about that.

Yeah, I think the other thing that gives us a little bit more comfort and conviction is that the savings of $2 billion, as I mentioned, these are incremental investments. We already have investments in our baseline, which are being repurposed now to growth and operating efficiencies. Previously they were doing risk and controls.

The saves of $2 billion, we feel very comfortable with because a lot of those are also in work in process. Claudio talked about 35% of his initiatives that are already in place. So it is not that we are only going to get these efficiencies if we spend this money in this period of time.

The pacing may change as Christian mentioned, if you have to repace them. But that gives us conviction. On the $3 billion revenue, I think we all -- you've probably heard from each one of us that we were pretty prudent in our aspiration around the revenue growth, around 5% because we felt that it was important to have the revenue come from where we wanted to come from.

So we felt comfortable that these investments are incremental investments needed now because they really give us the up-siding or what we ordinarily would not have, but the efficiency initiatives are going to be delivered based on the back of also the investments they have already been made. These are just a multiplier effect of that.

Maybe on the point on upside on the loan books, in FIC Financing we see substantial upside potential should a couple of assumptions we have made not play out to the way we have done it, which is quite conservative. I refer to spread compression, if we see a correction to the spread compression there could be the opportunity for us doing more in that place -- in that space, at attractive return on tangible equity.

Equally, if we -- Raja made reference to the fact that FRTB has conservative assumption that it will happen. Should there be a correction and alignment of competitiveness between US and European authorities, that's a several-billion worth of RWA that in FIC financing, for example, we could redeploy at a very attractive marginal return.

In CB, the biggest opportunities, again, we highlighted it, if the German fiscal stimulus plays out to a higher potential than what we have assumed, which is only what has been announced to date, we could actually see a material pickup in OpEx/CapEx measures, in export credit agency measures, right in the areas where we are making capability and technology investments.

So there is potential for upside. The plan you see is based on conservative assumptions within those conservative assumptions is promising pretty attractive marginal returns. And we intend to keep those, should those opportunities open up.

I think if you ask me where the upside was overall from a revenue point of view, it would not necessarily be on lending. There is some upside, I mean, there is definitely growth in there, but I think we're pretty sure what we're doing in that space. I would point anyways to Lombard. Lombard is something where we are making IT investments together with markets to have a system that allows us to scale it up. That definitely is not fully priced in, so the potential for Lombard.

And you combine that with the higher focus on assets under custody, and it can become actually incremental, because asset under custody is something we have not focused as much. When you start having large positions under custody, those lend themselves to Lombard lending for diversification. So some material upside in that space, in the Lombard space, overall. But I think we are happy with the missions we have, and we think that they are solid.

Back in the middle of the room.

Giulia Miotto from Morgan Stanley. I have 2. Can you hear me?

Yes.

So let me start with capital. On Slide 16, you mentioned inorganic growth opportunities. How are you thinking about this? Is it something very remote, or actually are you looking more closely at potential M&A? And if you are, in what area? Would it be Wealth Management, would it be, I don't know, German? Any comment? And then secondly, again on capital. Did I understand it correctly that the decision around the excess capital distribution above 14% comes once a year? Or shall we expect a bi-annual path?

Well, let me start with your M&A question. Look, a couple of answers to that. Number one, look at the slide of Raja where he also put a ranking what we are focusing on. And I think on the lowest rank, so to say, it was, if at all, if it fits from a strategic, from a cultural, from a financial point of view potentially in Asset Management or in Wealth Management, we would look at this.

But it is #5 of 5 rankings. And there you can see this conviction of this management team, that we can grow organically to either the larger than 13% or the EUR 37 billion of revenues, with actually doing further our homework. Everything what we presented today, we don't need an external lever. It's all in our levers and in our hands.

And therefore our focus is on ourselves, and therefore M&A is not something, which is at the core of our strategy. Again, of course, in a business like Asset Management, if there is an opportunity we need to look at it. But the real focus is on organic growth, and everything what we have shown today on the 5 billion of revenues has nothing to do with inorganic.

Giulia, thanks for the question. I think I just wanted to reiterate that every -- when we get to a capital that's sustainably over 14%, that's when we start considering the return versus invest. So just wanted to make sure that point, that it is not that if it hits 14% for one day and we get there. That's our commitment.

Secondly, it's -- typically our practice has been an annual, but it can be done more frequently. You can do a semi-annual cycle. But I think our view would be that that's a decision we will make when we are at that point. But there is no prohibition for that.

In the same row, a few seats across.

Flora Bocahut from Barclays. The first question I wanted to ask you is on the cost savings of 2 billion euros that you discussed for this plan. I do not think you talked about any restructuring costs that would be associated with that.

Can you say that again? The last...

Just checking if there is any plan with those savings. And I think you talked about the natural attrition in the group. So do you have maybe a number you can give us, either gross or net of hiring, but how much of your workforce basically you lose every year to help us understand the savings?

And the second question is more specifically on the Investment Bank, where I see the mix is going to go towards more banking fees. Which normally I would assume come with a higher cost/income ratio, and yet you target the cost/income ratio for the whole IB is going to go down. So I wanted to ask you how this is achievable, basically.

I would defer the first questions to my 2 CFOs. It is actually great to have each one, too. But one thing I can tell you, if we give you a plan for the next 3 years, which obviously is talking about reduction in costs, we will also consider restructuring costs.

Now do not forget what, for instance, Claudio said, that a good part actually of what he's seeing in particular in 2026 is already in the books. Not only agreed, but certain restructuring costs have been taken. And therefore it is also, in this regard, a very clean and a very prudent plan. But why do you want to give more details?

Yes. And look, when we are laying out the plans and we are talking about the investments, we are already contemplating, if and when, what restructuring dollars would be needed. And I think from my perspective there probably will be closer to the level that we had in 2025. But as James said, it is not our intention starting January 1 to have a adjusted cost base or have a discussion. I think as a mature, profitable, successful bank, this is par for the course. As you go along you pay for restructuring and you reinvest. So that is the way I would think about it.

Yeah, completely agree. And so that was one of the reasons behind moving away from adjusted cost-based disclosure, given that restructuring costs should be a much smaller level, but a normal part of the operating cadence. On attrition, I do not have the numbers right in front of me, we have run around 5%, I think, at the group for some time after the sort of things normalized after COVID.

But in that 5%, there's a range of certain geographies where you have much higher, but also normal for those markets, attrition that takes place. Others that are like Germany that are much lower. And so, all of that is built in. In fact it is one of, I think, the levers we have for managing the expense space.

I think one of the slides talked to it as a managed attrition strategy, meaning that we can -- I think we feel better-positioned now to flex the workforce using attrition as a lever. And as Raja said in his remarks, also the retirement wave that is building over the years. Those are levers that we -- I think we can use more flexibly in the years to come.

On your question on Investment Bank cost/income ratio, there are multiple elements to keep into account. One is, as I said, that there are past investments we have already made that will monetize. So, they will bring zero incremental costs, but the revenues that will bring bankers we have already hired to a full productivity level. A number of the investments we highlighted are actually going to be self-funded, by actually rotating our own bankers towards the higher productivity levels.

Thirdly, we will have cost reductions that are coming from investments we're making. I highlight the EUR 120 million of cost reductions across the Investment Bank by 2028, which will offset and improve the cost/income ratio of the division overall, so will offset some of the investments we're making.

The last point, because we are focusing so much also on cross-divisional opportunities, there is incremental value that we can extract there. Because it would be revenues we can generate with the same products, the same clients, the same bankers, just by collaborating more closely with them. So when you add it all up, actually the opportunity to improve our cost/income ratio across the Investment Bank is very tangible, and it will more than cover the investment that we plan to make, both on technology and on people.

[indiscernible] ahead.

Kian Abouhossein from JPMorgan. First of all, thanks James, for all your support over the last few years. My first question is regarding SVA. I get very excited about these SVA charts, and the numbers to me look quite small, EUR 5 billion when I start to add numbers up. Clearly there is a lot of overlap, but the SVA alone, that is EUR 3 billion of change, 100 basis points. Of that you have about EUR 1.2 billion of refinancing on the structural hedge.

Then there's some growth in wealth, so some corporate growth. The IB fees are going to go up based on your guidance. So can you just talk about EUR 5 billion looks like a minimum number. Is that kind of the way am I looking at this right? And what is actually the potential in the EUR 5 billion?

And then the second question is regarding the staff numbers. Can you just talk a little bit about how staff numbers on a net basis are changing and in what area, considering there's a lot of adjustments, it looks like, on the staff of turnover, better people for poor people?

Let me start with the staff number, so the 2 CFOs can decide who takes the SVA, right? Look, sometimes in life you also need to learn. You remember that I gave a staff number out in 2018, and up to now some media outlets are still chasing me on this one. We did the right thing for Deutsche Bank, because Kian, you know that we, for instance, in Bernd's business whereas Bernd's business is over there, we internalized, rightly so.

That was not in our plan in 2018, but we actually took externals out, internalized in technology, was exactly the right strategy. We brought costs down, but obviously the workforce did not go there where we set it in 2018. Secondly, growth was much, much higher than we thought. And I think Stefan said it so nicely, there are good costs and there are bad costs. That is clearly good costs, and then you invest.

Now what do I want to tell you? We are not handing out a staff number. Clearly we see that, in areas where we have fixed the core, where we have done a lot of remediation, where so much technology is now going into our processes, I clearly expect that FTE and staff numbers will come down. I do believe, with all the work Fabrizio has done with the operations team in KYC, the way we are doing it over time now, staff numbers come down.

If I talk to Bernd, then yes on the one hand, Kian, we will further internalize, because there are still externals and we think it is actually a good move to further internalize. However, you have also seen my quote, what actually AI means and how we can do coding in the future with far less coders. And therefore, overall, you see actually Claudio's business in the way he is reducing also in Germany on the operations side, but also in the retail branch side, further people.

Because it is also a different way how the clients want to be served. So, net-net, clearly it is one direction, it goes down. But I would not give you a number. The most important is actually the overall costs which we manage, the EUR 2 billion of efficiencies. And there I think we have a good track record. I should have said that to your question before, it is not only about can we cut investments if growth is not coming.

I am really proud what the team around Rebecca has achieved over the last 2 or 3 years, because we had, if you remember 2 years ago, a cost goal of EUR 2 billion. We upsized it to EUR 2.5 billion. We did it. And this is exactly where you actually move ahead from year to year, and that's what I also expect. And therefore yes, workforce is of course important, it will go down. But I think I would do a material mistake when I give you a detailed number.

Kian, I will take the question. This is my third stop at a global bank. I cannot count on one hand, somebody said a revenue assumption was conservative, but I will take it. Look, I will take you back to my slide where I was trying to make three points. I actually try to make 3 points on many slides. But it is really important for me, as much as what the composition of the revenue growth is, versus the top line number.

And I think as we highlighted on that slide, 70% of our revenue growth is coming from the focus areas that we want it to come from. Asset gathering, payments and services, advisory, all high-quality revenue which is capital light, on the back of the investments we are making. So to me, I think it's -- the composition is almost as important as the actual headline number. And I think you heard from every single person, we see upside.

We built a plan which was prudent, which gave us the cushion to make sure that we can stick with our investment strategy, we can build for the long term. But from my perspective, Christian laid out 4 factors, I laid out 4 factors, the businesses. So, these guys are working harder to get us to more than 5%. Our plan is based on 5%, but the aspiration of every single person on this podium is to have a higher revenue growth than that.

Maybe I can just add to that because of the history that we have been through together. And Chris asked the question at the beginning, sort of, what's the over/under? But let me just say one thing, as we began this planning process we around the table made a deliberate choice not to overstretch. And I think you've seen us over the years, I think correctly for the company, but we have built ambitious plans in the past, worked hard to achieve them, and by and large we have achieved them.

But we made a conscious choice to give ourselves a little bit more breathing room in this case. And I think that's the right thing. Again, I am also very excited about the potential that the SVA discipline, a lot of the things that we have talked to you about today, can deliver.

And by the way, the controls that Rebecca, again, and I have built together over the years over things like expenses, internal/external expenses, hiring and so on and so forth. I think there is a lot in those charts in terms of the opportunity from the SVA management, the continuation of the disciplined way we have learned to run the company, and if you like, some leverage.

And then the last thing is just the scale. We can see that in many of our businesses, Fabrizio talked about the marginal RWA, marginal cost/income ratio. A lot of us with responsibility for functions can see that we have reached sort of the inflection point, where more revenue on the platform doesn't entail necessarily proportionally more revenues -- expenses. And that's exciting. I think there is real opportunity for us to sort of manage the business in a very different way to the past 5, 8 years.

So we have about 10 minutes left, just under. It's been quiet on the Zoom, so I'll stick to the room, from my left.

Joe Dickerson from Jefferies. Just a question on DWS, what's the plan with DWS? Is there an opportunity to bring that into part of the bigger house, and perhaps do larger M&A? So any comment there? And then there was much discussion on the velocity of capital, notably around SRTs. So I was wondering, I think I can back into kind of an answer, but do you have a nominal amount of SRTs you're looking to do over this plan, based on I think it was the 25% contribution to capital?

I will take the first and let Raja take the second. Look, when we took DWS public back in 2018, one of the elements of the rationale was to give it the strategic flexibility to pursue transactions. And it is a great structure. DWS obviously has a listing, can use that stock as a currency. It is relatively efficient for the group in terms of how we carry it from a capital perspective, and how new acquisitions would play in.

It also has debt capacity, and an A2 external rating. So that flexibility exists and is valuable, even if we have not used it so far. And I think it has been more disciplined on the part of the DWS management team. The right opportunities have not necessarily arisen yet, but the structure gives it the potential to do that in the ways I described. And at least for now we think that optionality is very valuable.

Look, on the SRTs, that is actually a very exciting story for us because we are trying to increase that by 25%. But what we have identified is that we can do that by increasing our current issuance, but also there are asset classes that we have not previously used. So it is not a matter of going to the last and going really deep in what we already have, but actually diversifying that base that also takes away some of the maturity risk. So we are targeting around 25% by 2028, and actually it is across the asset classes in IB, PB and CB.

I think Stefan wants to add something on DWS.

[indiscernible]

Not that the majority shareholders ask me.

And let me say, I love this business.

So look, M&A should be done, not talked about. I think the points that I think everyone has made is that we are incredibly disciplined in how we obviously look after capital, but we also feel we have a pretty exciting organic growth path. Now there are certain things that you would not be able to build organically. Some capabilities are quite difficult to build, sometimes getting access to certain client types is difficult to build organically.

But probably most relevantly, certain regions, certain countries are very difficult to enter organically. So, the announcement last week of us having a proper strategic partnership, or signed an MOU, but with Nippon Life in India, that is such an example. So we spent quite a bit of time over the last couple of years to see whether this exciting market we could enter organically, and just very difficult because of distribution and so on. And then having a partner locally to team up with was simply the prudent, inorganic path. So that is how we are thinking about it.

And the last question comes from the very top of the house.

You have talked quite a lot about artificial intelligence, and Raja, you called it an AI revolution. And that is probably true, and it affects your clients as well and it affects your competitors. So my question is, how do you think about the potential implications of that for margins, competitive intensity in your industry, but maybe also change in demand for certain products from your clients as they also go down this route of revolutionizing the use of AI?

And the second question goes back to the question on the trajectory to get from 2025 to 2028. Can you already share with us what is the RoTE level that you will be measured against at the ExCo board for your compensation next year?

Nice try. Look, on the AI side, I really would like to ask my 3 business partners to give a little bit of an outline. Because as you rightly say, it will affect each and every business. And the only one thing to add to this, because I always see AI in terms of client experience, cost efficiencies and controls. It is a massive opportunity for a global bank.

The most important is actually how we as a management team are implementing this mindset into the bank. Because everybody will tell you he and she is already using AI, but what you really need to do is to understand what kind of impact it has and that you then also do the follow-up changes. It is a leadership task, It is a management task.

Everybody will tell you about great AI, but if you do not get to the potential behind that then you will fail. And therefore, I think as much as it is a technology question, it is a leadership question for all of us. And therefore, I ask each one in the executive team to really also not only think about the next great product, but about the leadership responsibility we have with deploying AI.

Number two on the RoTE, look, no, I'm not giving you anything. I can only tell you I would be very disappointed if we are not having a gradual increase year-over-year. This bank is set to grow, not only in terms of revenues but also in terms of profitability. Fabio, do you want to start?

Sure. I think on AI you said it. You said the 3 categories of client experience, cost efficiency, control enhancement are really what we have been focusing on. Our clients are thinking about it a bit differently, but they're not thinking about it as AI replacing the necessity for a banking partner in many of their interactions with us. So we actually see an optimization potential.

I will give you just one example on client experience. In the Corporate Bank, the way we think about client experience is often focused on time-to-yes, time-to transact, time-to-settle and automation and self servicing. Time-to-yes means that clients stop shopping around for a bank, telling them that they're ready to transact.

Time-to-transact cuts down the cost and the time it takes for a client to do what they need to do. Time-to-settle reduces risk on both sides. And if you can automate the workflows, then it takes a lot of cost and commitments required across currencies, jurisdictions, out of the client organizations.

AI can help tremendously on each of these 4 ways of thinking about improving the client experience and the way we face off against them. On risk management, we have a number of examples, but both on the financial risk side, where Marcus and I are partnering up to take down the time it takes, as I said earlier, to onboard a new lending client in the SME space or in the biz banking space, from weeks to hours.

And with Laura Padovani, we have partnered up over the deployment at scale of AI for the improvement of our non-financial risk monitoring, to make sure that we actually have more artificial agents looking at our ongoing risks. And that way we can cover a lot more of the spectrum of interactions. This will also help our clients, because they will have a higher reliability in dealing with a bank that has that capability than one that manually may realize, T+2, T+3, that there is an issue with trades that we had done with them that may have already been settled.

Stefan...

So, look, there are, I guess, many Asset Management colleagues here in the audience. So it seems that the essence of what we do could be disrupted by AI. So the art of picking and choosing stocks and bonds based on public information seems like something that I should be able to do reasonably well. Now obviously we spend a lot of time in experimenting. So far it seems we're all safe, because so far it seems that there is plenty of efficiency cases.

We are experimenting, and I mentioned that briefly earlier, on AI companions. So somebody who is challenging you on, let's say, portfolio construction. So if you have had been right 5 times in a row, maybe you are overly optimistic and so on. But again, so far it is more like human plus machine. Now at our last quarterly earnings 2 weeks ago, we did an AI deep dive, and we would love to get feedback from people. Because we feel long-term what we are spending time on is the following.

AI is really focusing on what's the most likely next word. So, something happens, what's the most likely reaction? However, the best portfolio managers are those with very unconventional thinking. So asking the one question nobody has thought of, which is almost like the inverse of AI. So what we're trying long-term is to see what synthesis of information, what combination of skills leads to those unconventional, but then really difference-making questions. But again, so far we haven't been able to do it. But lots of focus on AI.

Look, I think the colleagues spoke about all of the benefits, and you heard it in multiple presentation, all of the benefits from an efficiency point of view, from a cost-reduction point of view. And that holds true 100% for the Private Bank as well. Personally, what I find most exciting is the way it will allow us to interact with clients.

And if you think about retail is probably the area where that will have more of a dramatic impact, in the sense that today most of the interaction with our clients and this is not so much or not only because of the way we are set up, this is part of European society and certainly in German society. People still like to interact, if possible, verbally or personally.

And clearly, in a business like retail, the quality and the added value you can bring in a sustainable, in a cost-sustainable, in a profitable way is limited. AI in the development, the latest development of AI, that's why I was talking about an AI voiced enabled butler, assistant, call it however you want, are really transformational for the relationship we have with clients.

It will allow all 19 million customers, hopefully a larger portion of the society in Germany, to really come much closer to us and allow us to give them a service, a personalized service, an exclusive service that was first -- was before just for few, to a much, much larger number of people, actually to everybody, at a very sustainable cost.

So I think that is inevitably going to create huge opportunities for us to satisfy them better, and for us to provide them services that go also beyond banking, in all fairness. I think that's the most exciting part of the journey over the next few years.

Thank you. So that takes us to time. Before I hand back to Christian for his closing remarks, I would like to thank everyone who has listened and participated today. If you have any remaining questions, the IR team is available to help through the usual channels. And with that, let me hand it back to Christian.

Thank you, Ioana. And to everybody here in the room, thank you for coming. It means a lot for us that you have stayed with us for the last 4.5 half hours. I know that there is a lot going on, I know that there are some other deep dives tomorrow and the week later. So, thank you for coming. Thank you also for your questions.

It was a very interesting interaction with you, and we hope you now have a clear view of Deutsche Bank's path for the next 3 years, i.e. the financial roadmap through 2028. We also hope you take away some impressions that go beyond our financial path, and that is #1, that we are convinced that today's environment is actually playing to the strengths of Deutsche Bank.

Second, all the 3 levers and what is behind our plan is completely in our hands. It is under our control. Thirdly, this management team, and hopefully you got a similar impression, is firmly committed to deliver on these targets, but also to build Deutsche Bank for the next decade. We are determined actually to be the Global Hausbank, we want to be the Global Hausbank and the European champion.

And on behalf of all my colleagues, thank you very much. A special thank you, Ioana, to you and your team. I think you have prepared it over the last 7, 10 days in detail. We only have been here since Thursday. A special thank you for all the Deutsche Bank teams working since 3 to 6 months for this day. It has been a pleasure, it was a privilege. Now all of you think that I'm thanking James, I am not doing this. He needs to deliver Q4, and he will deliver Q4. Thank you very much. See you in the reception area. It was a pleasure. Thank you.

Ladies and gentlemen, welcome to the Q3 2025 Fixed Income Conference Call and Live Webcast. I'm Moritz, the Chorus Call operator. [Operator Instructions] At this time, it's my pleasure to hand over to Philip Teuchner, Investor Relations. Please go ahead.

Good afternoon or good morning and thank you all for joining us today. On the call, our Group Treasurer, Richard Stewart, will take us through some fixed income-specific topics.

For the subsequent Q&A session, we also have our CFO, James von Moltke, with us to answer your questions. The slides that accompany the topics are available for download from our website at db.com.

After the presentation, we will be happy to take your questions. Before we get started, I just want to remind you that the presentation may contain forward-looking statements, which may not develop as we currently expect.

Therefore, please take note of the precautionary warning at the end of our materials. With that, let me hand over to Richard.

Thank you, Philip, and welcome from me. We delivered record profitability in the first 9 months of 2025. We are tracking in line with our full year 2025 goals on all dimensions. 9-month revenues at EUR 24.4 billion are fully in line with our full year goal of around EUR 32 billion before FX effects.

Adjusted costs are consistent with our guidance. Post-tax return on tangible equity is 10.9%, meeting our full year target of above 10% and our cost-income ratio at 63% is also consistent with our target of below 65%.

Operating leverage drove our profit growth. Pre-provision profit was EUR 9 billion in the first 9 months of 2025, up nearly 50% year-on-year or nearly 30% if adjusted for the impact of Postbank litigation impacts in both periods. We saw continued revenue growth of 7% with momentum across all businesses.

Net commission and fee income was up 5% year-on-year, while net interest income across key banking book segments and other funding was essentially stable.

74% of revenues came from the more predictable revenue streams, the Corporate Bank, Private Bank, Asset Management and financing businesses in FIC.

Cost discipline remains strong. Noninterest expenses were down 8% year-on-year with significantly lower nonoperating costs, largely due to the nonrepeat of Postbank litigation provisions, while adjusted costs were flat.

And our asset quality remains solid. Provisions were in line with expectations, we had no exposure to recent high-profile cases.

Let me now turn to our progress on the pairs of strategy execution on Slide 3. We are on track to meet or exceed all our 2025 strategy goals.

The compound annual revenue growth rate since 2021 was 6% in the middle of our range of between 5.5% and 6.5%. In a changing environment, we are benefiting from a well-diversified earnings mix.

Operational efficiencies stood at EUR 2.4 billion, either delivered or expected from measures completed. In other words, 95% of our EUR 2.5 billion goal.

Capital efficiencies have already reached EUR 30 billion in RWA reductions, the high end of our target range, and we continue to see scope for further efficiencies through year-end.

During the quarter, we launched our second share buyback program of 2025 with a value of EUR 250 million, which we completed last week. This brings cumulative distributions since 2022 to EUR 5.6 billion.

Let's now turn to some remarks on our businesses on Slide 4. We are delivering strength and strategic execution across all 4 businesses in our Global Hausbank. All businesses have delivered double-digit profit growth and all 4 have delivered double-digit RoTE in the first 9 months.

The Corporate Bank continues to further scale the Global Hausbank model and delivered strong fee growth of 5% in the first 9 months and was recognized as the best trade finance bank.

Our Investment Bank has been there for clients through challenging times this year and has seen an increase in activity across the whole client spectrum.

Private Bank has made tremendous progress with its transformation so far this year with 9 months profits up 71%. Our growth strategy in Wealth Management is paying off.

Assets under management have grown by EUR 40 billion year-to-date with net inflows of EUR 25 billion. And in Asset Management, the combination of fee-based expansion with operational efficiency drives sustainable returns of 25%.

We are benefiting from our strength in European ETFs and are expanding our offering in that area. Turning now to net interest income on Slide 5. NII across key banking book segments and other funding was EUR 3.3 billion in the quarter.

Private Bank continues to deliver steady NII growth, supported by the ongoing rollover of our structural hedge portfolio as well as deposit inflows. For Bank, NII is slightly down quarter-on-quarter, principally driven by lower one-offs, but it continues to be supported by underlying portfolio growth as well as hedge rollover benefits.

With respect to the full year, we are on track to meet our plans on a currency-adjusted basis. Turning to Slide 6, which reflects market implied forward rates as of quarter end, we can see that our hedge portfolio positions us well.

In the third quarter, the total volume invested long term staged around EUR 245 billion or around EUR 200 billion, excluding equity hedges. The result of our hedge approach is that a large proportion of our future NII is now locked in.

In addition, the absolute NII contribution of the hedge portfolio grows steadily as new hedges are executed above the rate of maturing hedges. In the appendix, you can also see that our NII sensitivity remains contained with a little change quarter-over-quarter.

Looking at the development of the loan book on Slide 7, we can see that during the third quarter, loans grew by EUR 3 billion adjusted for FX effects. The underlying quality of the loan book remains strong. Around 2/3 of our clients are located in Germany and Europe.

Our loan portfolio in the Investment Bank shows sustained growth driven by FIC as well as encouraging momentum in M&A.

In the Private Bank, we continue to deliver on our strategic commitment to a capital-efficient balance sheet through further targeted mortgage reductions, while we also saw encouraging growth in Wealth Management.

In the Corporate Bank, client demand remained muted this quarter as geopolitical uncertainties continue to persist. However, looking ahead, we expect lending in the core bank to benefit from the fiscal stimulus in Germany and to accelerate over the course of 2026.

The lending outlook also remains strong in FIC and reflects our strategic focus on growing the franchise and expanding market share.

Moving now to deposits on Slide 8. Our well-diversified deposit book has grown by EUR 10 billion during the third quarter adjusted for FX effects.

Our portfolio continues to be of high quality, supported by a strong domestic footprint and a substantial level of insured deposits. Deposit growth has been most pronounced in the Private Bank, where we saw continued momentum and strong inflows from our retail campaigns in Germany.

The Corporate Bank portfolio has also grown during the quarter, driven by inflows in site deposits on the back of high client engagement.

For the remainder of the year, we expect further inflows from deposit campaigns in the Private Bank, while we also see opportunities for growth and portfolio optimizations in the Corporate Bank.

On Slide 9, we highlight the development of our key liquidity metrics. We managed our liquidity coverage ratio to 140% at quarter end, thereby demonstrating the inherent strength and resilience of our balance sheet.

The surplus above the regulatory minimum increased by about EUR 5 billion due to slightly higher HQLA and reduced net cash outflows. We continue to maintain a high-quality liquidity buffer and hold about 95% of HQLA in cash and Level 1 securities.

The net stable funding ratio slightly decreased to 119% with a surplus above regulatory requirements of EUR 101 billion. This reflects our stable funding base with more than 2/3 of the group's funding sources coming from our global deposit franchise.

Turning to capital on Slide 10. Strong third quarter earnings net of AT1 coupon and dividend deductions led to an increase in the CET1 ratio to 14.5%, up 26 basis points sequentially.

RWA remained flat during the quarter as an increase in credit risk RWA driven by higher loans and commitments was offset by a reduction in market risk, notably in SVaR.

As we head into the fourth quarter, let me remind you of the 27 basis points CET1 benefit we still have from the adoption of the Article 468 CRR transitional rule for unrealized gains and losses, which will expire at the end of the year.

Also following revised EBA guidance from June 2025 regarding the calculation of operational risk RWA under the new standardized approach, we must now perform the annual update of operational risk RWA already by the end of 2025, which is expected to lead to a 19 basis points drawdown in CET1 ratio terms.

All else equal, applying these 2 items to our third quarter CET1 ratio results in a pro forma CET1 ratio of approximately 14%, which is also roughly where we expect currently to finish the year.

Our capital ratios remain well above regulatory requirements, as shown on Slide 11. The CET1 MDA buffer now stands at 325 basis points or EUR 11 billion of CET1 capital.

The 25 basis points quarter-on-quarter buffer increase reflects our higher CET1 ratio buffer. The buffer to total capital requirement decreased by 8 basis points and now stands at 362 basis points.

Moving to Slide 12. Our third quarter leverage ratio was 4.6%, down 11 basis points, principally from higher loans and commitments alongside increased settlement activities at quarter end.

Tier 1 capital was essentially flat in the quarter as the derecognition of the $1.25 billion AT1 instrument that we called in September materially offset the quarter-on-quarter increase in CET1 capital.

We continue to operate with significant loss-absorbing capacity well above all requirements as shown on Slide 13. The MREL surplus, our most binding constraint, increased by EUR 2 billion to EUR 26 billion.

Our surplus thus remains at a comfortable level, which continues to provide us with the flexibility to pause issuing new eligible liabilities instruments for at least 1 year.

Moving now to our issuance plan on Slide 14. Credit markets developed constructively in the third quarter, and our spreads also benefited from this trend. Our senior nonpreferred bonds tightened by around 20 basis points on average in the quarter, allowing us to issue at attractive funding costs.

With year-to-date issuance of EUR 15.1 billion, we have already reached the lower end of the range of our full year guidance. We reaffirm our target range of EUR 15 billion to EUR 20 billion for the full year.

Since the last fixed income call in July, we issued EUR 4.2 billion, primarily in senior nonpreferred format across euros and dollars. Residual funding for the year 2025 will be focused on the senior preferred instruments.

Such issuance typically takes the form of private placements or retail targeted issuance as opposed to public benchmarks. We expect 2026 requirements to be in a similar, possibly slightly lower range as compared to 2025.

As usual, in the fourth quarter, we may consider prefunding 2026 requirements depending on market conditions.

To summarize on Slide 15, we are on track to meet our full year 2025 targets and remain confident in our trajectory to deliver a return on tangible equity of above 10% and a cost-income ratio of below 65%.

Our year-to-date performance supports our revenue and expense objectives. Our asset quality remains solid and despite uncertainty from developments around commercial real estate as well as the macroeconomic environment, we continue to anticipate lower provisioning levels in the second half of the year.

Our strong capital position and third quarter profit growth provide a solid foundation as we head into 2026. With year-to-date issuance of EUR 15 billion, we have substantially met our issuance needs for the year. With that, let's turn to your questions.

[Operator Instructions] And the first question comes from Lee Street from Citigroup.

I have 2 questions, please. Firstly, and I'm not trying to front run your Investor Day. But as we look ahead to the next few years, do you think it's reasonable to presume that a 10% return on tangible equity should be like the floor of where we should be seeing Deutsche Bank perform on an annual basis? That would be my first question.

And secondly, you hopefully gave details with your private credit exposures look quite light. You give a lot of detail on your commercial real estate exposure you have done for some time. Setting those 2 sectors aside, what other areas are on your watch list at the moment and where you're paying attention, getting briefings on? That would be my 2 questions.

Thanks, Lee. It's James. Happy to take the questions. Look, without being drawn to specific numbers, we certainly are working over the years to come to put a good amount of distance between where we are operating at any given time and sort of a low point.

This through-the-cycle thinking is not lost on us, in other words. And I do believe that the structural profitability of the company has risen to the point where numbers like what you throw out are entirely possible.

I think the other thing, specifically from a credit investors' perspective, the PPNR, and we still disclose the PPNR in Christian's slides in the equity deck, the PPNR that's associated with that profitability has become a larger and larger potential loss-absorbing kind of layer, as is the capital that's disregarded in the ratio as you go through the year on the payout level.

So without changing the ratio, you have some loss absorption as the year goes by. So I do believe it paints a more and more robust picture as time goes on.

On the credit side, you called out those 2 areas. Obviously, private credit for us was not a source of concern. It's a source of kind of watch given the potential read across, and we've done some work on that.

CRE has remained a soft spot for sure. And you've seen that in our quarterly reporting. We do expect in time there to be a healing of that market, and we've seen some initial positive indicators, but I think it remains a watch item.

I'd say beyond that, earlier this year, you'll recall, we've done a fair amount of work looking at our portfolio in terms of potential sensitivity to the trade changes and policy changes as well as specifically the automotive and manufacturing sectors in Germany.

We've actually seen that hold up very well this year and are pleased with the performance. But no doubt, as the -- as kind of the world moves on, time moves on, it will remain a watch area for us.

And I think the last thing to call out is sort of geopolitical risks. We tend to see very little exposure in our portfolios to the events that you've seen. But we, of course, continuously stress test for either real or potential events, and that's also an ongoing area of focus for us. I hope that helps, Lee.

And the next question comes from Dan David from Autonomous.

Congratulations on the results. I've got 3, if possible. The first maybe is just leading on from what Lee was just asking. I think as a result of one of your French peers, receivable financing is kind of the latest buzzword.

Can you just talk about your exposure in that area and where we would see it in the Deutsche Bank balance sheet if you do have exposure?

The second one is on Tier 2. So you've maintained a Tier 2 deficit offset by the surplus in AT1 for a while now. Is that how we should think about your capital stack going forward? I guess, is that likely to change?

And then the third one is a bit more broad on the topic of sustainability. Noting the kind of ongoing political developments in Europe, do you feel at a competitive disadvantage compared to U.S. peers as a result of the sustainable landscape in Europe? I would appreciate any thoughts.

Sure, Dan, it's James. I'll perhaps take the first and third and ask Richard to take the capital stack question. Receivables financing, I can't tell you the sort of the size of the portfolio, but we -- in trade finance, we do some sort of supply chain financing.

I don't think it's a large exposure, but it's certainly something that we do in trade finance. And there can be some exposures of that nature in ABS as well, in ABS format. So we have some exposures, but I would not think of it as a significant exposure for us as a group.

As always, I don't want to sort of recite all of the sort of controls that we put around our book as a whole. But obviously, anything we do in receivable financing has the same type of first and second line scrutiny as we do in other secured and unsecured financing types.

On the sustainability side, I would not think of it as a competitive disadvantage. Let me make a few points.

Firstly, we've made a tremendous amount of progress in our overall sustainability agenda in the firm over the years, represented or recognized among other things in our ESG ratings, which have improved, but also the business activity that we do with clients as they think about their transition plans, sustainable financing, transition financing.

It's -- I don't want to go so far as to say it's a competitive advantage. But to a certain extent, the fact that it gets deemphasized perhaps by some of our peers across the Atlantic gives more of that space to us and others who remain sort of engaged on the topic.

I noticed an article this week that spoke to higher financing levels for renewable energy sources this year than carbon-based energy sources. So to give you an example that the market is evolving.

And clearly, there's also -- there's a revenue and business opportunity attached to some of this, which can be impacted by sort of changes in the landscape. So we don't think of it as a competitive disadvantage. The last point to make is just on the disclosure requirements.

Of course, we do embrace simplification and standardization of disclosure requirements and taxonomies because we've been through a big build phase in the world and in what the requirements are for banks.

And the more one can simplify that landscape without losing the benefit of some of the models, taxonomies, definitions that we've created over the years, obviously, that's a benefit to the banks.

Dan, it's Richard here, and thanks for joining, and I'll pick up the Tier 2 question. So when we kind of think about our capital stack, we first kind of assess our Tier 1 capital needs first. And so once that is addressed, it kind of looks at the combination of both the Tier 1 and Tier 2 bucketing.

And as you kind of seen over the last couple of years, we probably overpopulated our Tier 1 bucket just to solve for client demand for leverage. And so that is something that has been the approach we've taken over the last few quarters.

And we kind of expect kind of our current thinking for that to continue. Having said that, our Tier 2 instrument is still a useful instrument for us. We still think it's valuable. And so it's not saying we're precluding from issuing that space in the future.

And the next question comes from Robert Smalley from MacKay Shields.

I have 2. First on commercial real estate, which has been nettlesome. Could you talk a little bit about specifically where the issues are? I know on the REIT side, we get building-by-building type of disclosure.

But can we talk about where they are, what the plan is and how much restructuring you're looking at versus kind of nursing these things along for another couple of quarters? And if we are seeing restructuring, will it manifest itself in charge-offs in the fourth quarter?

And then my second question on the supplement that came out yesterday on Page 12, about 40-plus percent of Stage 1, Stage 2 loans are off-balance sheet positions. Could you characterize what those are generally? Because they don't go into Stage 3.

Is it mostly timing issues, et cetera, that puts them into Stage 1? And is there possibly a better way to do this than bucketing them in Stage 1, Stage 2, and Stage 3? Because it seems to pump up the numbers, but -- it seems to overstate the Stage 1 and Stage 2 numbers, but they seem to cure pretty easily.

Thanks, Rob. So it's James. There's a couple of answers to questions. On the CRE, the concentration of the CLPs that we've seen in the past couple of quarters has been in those exposures on the West Coast that we've referred to.

So 60%, 70%, let's say, of the credit loss provisions this quarter has related to West Coast, and that's particularly California and Washington State.

Where that goes from here, I spoke a little bit about yesterday, but what we do is look at the portfolio on a forward basis.

First of all, looking at which loans are coming up for refinancing or extension and taking a view as to which will be sort of money good loans that are eligible for refinancing or extension.

For those loans that are either sort of on the border or look to be troubled, we work intensively with the sponsors on what the strategy is for value sort of preservation creation.

I'd say that the tone of that effort has been -- has deteriorated a little bit as more of the equity has been consumed in the projects, but still remains overall positive, and we work -- we look to create sort of good outcomes and sharing of the burdens.

There is a small portfolio of real estate owned as well. To your question of what does that mean for the future, it's always going to be somewhat path dependent on what happens to appraisals, what happens to the individual buildings in terms of their lease footprint, in terms of sponsor decisions.

But at each quarter, we essentially mark the portfolio to our -- to the most recent appraisal and our expectations as to outcomes of those discussions.

And we feel good about the marks, including incidentally in the most recent quarter, having taken a portfolio to the market and seen bids come back that have been, by and large, very close to where we had those positions marked.

So short version of all that, it's too early to call an end to the trend. But as I said yesterday, certainly, we'd like to think we're much closer to the end than the beginning, even on the West Coast, although that's where the uncertainty sort of lies.

Your reference to Page 12, you are -- well, in essence, right, obviously, we follow the -- what the accounting standard requires in terms of the IFRS 9 provisioning and the portfolios against which the provisions are taken.

You can see that on off-balance sheet provisions, which are overwhelmingly essentially derivatives and, in some cases, committed facilities. So the amounts that are not recognized on the balance sheet, there tends to be a huge bias towards, obviously, Stages 1 and 2, much of that represents our trading businesses.

You may recall, Rob, that in disrupted market environments, we sometimes have migrations of those portfolios down, but it's typically temporary as your question refers. I don't know if there's a better way to disclose, but as you can see, the associated provisions are relatively nominal.

And I'm not sure how helpful at the end of the day, the disclosure is. Hopefully, that all helps. And Rob, nice to have you with us.

[Operator Instructions] So it looks like there are no further questions at this time. Then I would like to turn the conference back over to Philip Teuchner for any closing remarks.

Thank you, Moritz. And just to finish out, thank you all for joining us today. You know where the IR team is if you have any further questions, and we look forward to talking to you soon again. Goodbye, and have a nice day.

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 the Q3 2025 Analyst Conference Call. I'm Moritz, your 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 Ioana Patriniche, Head of Investor Relations. Please go ahead.

Thank you for joining us for our third quarter 2025 results call. As usual, our Chief Executive Officer, Christian Sewing, will speak first; followed by our Chief Financial Officer, James von Moltke. The presentation, as always, is available to download in the Investor Relations section of our website, db.com. Before we get started, let me just remind you that the presentation contains forward-looking statements, which may not develop as we currently expect. We, therefore, ask you to take notice of the precautionary warning at the end of our materials. With that, let me hand over to Christian.

Thank you, Ioana, and good morning from me. As you will have seen, we delivered record profitability in the first 9 months of 2025. We are tracking in line with our full year 2025 goals on all dimensions. 9 months revenues at EUR 24.4 billion are fully in line with our full year goal of around EUR 32 billion before FX effects. Adjusted costs at EUR 15.2 billion are consistent with our guidance.

Post-tax return on tangible equity is 10.9%, meeting our full year target of above 10%. And our cost/income ratio at 63% is also consistent with our target of below 65%. Profitability is significantly stronger than in the same period of 2024, even if adjusting for the Postbank litigation provision, which impacted last year's result.

Through organic capital generation, our CET1 ratio rose to 14.5% in the quarter. This reflects our latest share buyback program, which we completed this month and a significant proportion of next year's distributions. Asset quality remains solid. Provisions were in line with expectations, and we had no exposure to recent high-profile cases. In short, we are fully focused on delivering on our 2025 targets.

Let me now turn to the operating leverage, which drove our profit growth on Slide 3. Pre-provision profit was EUR 9 billion in the first 9 months of 2025, up nearly 50% year-on-year or nearly 30% if adjusted for the Postbank litigation impacts in both periods. Similarly, adjusted for the Postbank litigation impact, operating leverage was 9% and profit before tax was up 36%. We saw continued revenue growth of 7% with momentum across the businesses.

Net commission and fee income was up 5% year-on-year, while NII across key banking book segments and other funding was essentially stable. 74% of revenues came from more predictable revenue streams, the Corporate Bank, Private Bank, Asset Management and the financing business in FIC. Cost discipline remains strong. Noninterest expenses were down 8% year-on-year with significantly lower nonoperating costs, largely due to the nonrepeat of Postbank litigation provisions, while adjusted costs were flat.

Let me now turn to our progress on the pillars of strategy execution on Slide 4. We are on track to meet or exceed all our 2025 strategic goals. Compound annual revenue growth since 2021 was 6%, in the middle of our range of between 5.5% and 6.5%. In a changing environment, we are benefiting from a well-diversified earnings mix.

Operational efficiencies stood at EUR 2.4 billion, either delivered or expected from measures completed. In other words, 95% of our EUR 2.5 billion goal. Capital efficiencies have already reached EUR 30 billion in RWA reductions, the high end of our target range, and we see scope for further efficiency through year-end. During the quarter, we launched our second share buyback program of 2025 with a value of EUR 250 million, which we completed last week. This takes total share buybacks in 2025 to EUR 1 billion. So together with our 2024 dividend paid in May this year, total capital distributions in 2025 reached EUR 2.3 billion, up around 50% over 2024. This brings cumulative distributions since 2022 to EUR 5.6 billion.

Finally, a word on our business on Slide 5. We are delivering strength and strategic execution across all 4 businesses in our Global Hausbank in 2025. All 4 businesses have delivered double-digit profit growth and double-digit RoTE in the first 9 months. Corporate Bank continues to scale further the Global Hausbank model and delivered strong fee growth of 5% in the first 9 months, while recognized as the best trade finance bank.

Our Investment Bank has been there for clients through challenging times this year and has seen an increase in activity across the whole client spectrum, institutional, corporate and priority groups. Private Bank has made tremendous progress with its transformation so far this year, with 9 months profits up 71%. Our growth strategy in Wealth Management is paying off. Assets under management have grown by EUR 40 billion year-to-date with net inflows of EUR 25 billion.

And in Asset Management, the combination of fee-based expansion with operational efficiency drives sustainable returns of 25%. We are benefiting from our strength in European ETFs and expanding our offering in that area. To sum up our performance in 2025 to date, we have delivered record profitability due to continued revenue momentum and cost discipline. Our 9 months performance is in line with our full year financial goals on all dimensions. We are on track to reach or exceed our strategy execution targets.

We have demonstrated strength across all 4 of our businesses. Our capital position is strong and supports our aim of distributions to shareholders in excess of EUR 8 billion payable between 2022 and 2026. Before I hand over to James, I want to briefly address our future. We have built very strong foundations for the next phase of our strategic agenda. And with our positioning in the strongest European economy, we stand to benefit from powerful tailwinds coming from German fiscal stimulus, structural reforms and renewed client confidence. We look forward to discussing this with you at our Investor Deep Dive in London in November.

Thank you, Christian, and good morning. As you can see on Slide 7, we saw continued strong delivery this quarter against all the broader objectives and targets we set ourselves for 2025. Our revenue growth, cost/income ratio and return on tangible equity are all developing in line with our full year objectives. Our capital position is strong, and our liquidity metrics are sound. The liquidity coverage ratio finished the quarter at 140%, and the net stable funding ratio was 119%.

With that, let me now turn to the third quarter highlights on Slide 8. Our diversified and complementary business mix resulted in reported revenue growth of 7% year-on-year or 10% if adjusted for foreign exchange translation impacts. Due to the nonrecurrence of a provision release related to the Postbank takeover litigation matter from which we benefited last year, third quarter nonoperating costs and noninterest expenses were both higher year-on-year. The tax rate of 26% in the third quarter benefited from the reduction of deferred tax liabilities due to the change in the German corporate tax rate, which will start to decline after 2027. We continue to expect the 2025 full year tax rate to range between 28% and 29%. In the third quarter, diluted earnings per share was EUR 0.89 and tangible book value per share increased 3% year-on-year to EUR 30.17.

Before I go on, a few remarks on Corporate and Other with further information in the appendix on Slide 36. C&O generated a pretax loss of EUR 110 million in the quarter, mainly driven by shareholder expenses and other centrally held items, partially offset by positive revenues and valuation and timing differences. Let me now turn to some of the drivers of these results, starting with net interest income on Slide 9.

NII across key banking book segments and other funding was EUR 3.3 billion. Private Bank continued to deliver steady NII growth, supported by the ongoing rollover of our structural hedge portfolio and deposit inflows. Corporate Bank NII was slightly down quarter-on-quarter, reflecting lower one-offs, while it continues to be supported by underlying portfolio growth as well as hedge rollover. With respect to the full year, we continue to benefit from the long-term hedge portfolio rollover detailed on Slide 24 of the appendix and are on track to meet our plans on a currency-adjusted basis.

Turning to Slide 10. Adjusted costs were EUR 5 billion for the quarter. Cost discipline across the franchise remains strong. Compensation costs were up on a year-on-year basis, primarily reflecting the higher performance-related accruals, higher deferred equity compensation and the impact of increasing Deutsche Bank and DWS share prices. With that, let me turn to provision for credit losses on Slide 11.

Stage 3 provision for credit losses increased in the quarter to EUR 357 million as provisions for commercial real estate continued to be elevated, while the prior quarter included model-related benefits. Stage 1 and 2 provisions reduced to EUR 60 million and were driven by further model updates, which, as in the prior quarter, mainly impacted CRE-related provisions. Wider portfolio performance and asset quality remain resilient. While the macroeconomic and geopolitical environment continues to create uncertainty, we continue to expect lower provisioning levels in the second half of the year relative to the first half year, primarily due to the expected absence of additional notable model effects impacting Stage 1 and 2.

We are actively monitoring and managing risks from private credit, which, as outlined on Slide 28, accounts for about 5% of our loan book. Our private credit exposure predominantly reflects lender finance facilities extended to high-quality financial sponsors backed by diversified pools of loans. These facilities are overwhelmingly investment-grade rated internally and are underwritten and maintained with conservative LTVs. We apply conservative underwriting standards, including our assessment of sponsor and investor quality, loan sizes and structural features. We are comfortable with our portfolio. And as Christian said, we had no exposure to recent high-profile cases. As you might expect, we remain vigilant and have undertaken additional portfolio reviews in light of these events.

With that, let me turn to capital on Slide 12. Strong third quarter earnings, net of AT1 coupon and dividend deductions led to an increase in the CET1 ratio to 14.5%, up 26 basis points sequentially. RWA were flat during the quarter. As we head into the fourth quarter, let me remind you of the 27 basis point CET1 benefit we still have from the adoption of the Article 468 CRR transitional rule for unrealized gains and losses, which will expire at the end of the year.

Also, following revised EBA guidance from June 2025 regarding the calculation of operational risk RWA under the new standardized approach, we must now perform the annual update of operational risk RWA already by the end of 2025, which is expected to lead to a 19 basis point drawdown in CET1 ratio terms. All else equal, therefore, these 2 items applied to the third quarter would lead to a pro forma CET1 ratio of approximately 14%, which is also roughly where we currently expect to finish the year.

Our third quarter leverage ratio was 4.6%, down 11 basis points, principally from higher loans and commitments alongside increased settlement activity at quarter end. Tier 1 capital was essentially flat in the quarter as the derecognition of the USD 1.25 billion AT1 instrument that we called in September materially offset the quarter-on-quarter increase in CET1 capital. Let us now turn to performance in our businesses, starting with the Corporate Bank on Slide 14.

In the third quarter, Corporate Bank achieved a strong post-tax return on tangible equity of 16.2% and a cost/income ratio of 63%, maintaining its high profitability. Both metrics showed a year-on-year improvement for the quarter as well as for the first 9 months of 2025. As anticipated in the previous quarter, Corporate Bank revenues remained essentially flat compared to the prior year quarter, demonstrating resilience in a [indiscernible] challenging environment.

Margin normalization and FX headwinds were offset by interest hedging, higher average deposits and 4% growth in net commission and fee income, driven by continued expansion in corporate treasury services. On a sequential basis, revenues were slightly lower as the prior quarter benefited from one-off interest hedging gains and seasonally stronger net commission and fee income. Loans and deposits remained essentially flat on a reported basis.

Adjusted for foreign exchange movements, loan volumes increased by EUR 5 billion year-on-year, driven by growth in the trade finance business and by EUR 1 billion sequentially. Deposit volumes remained strong with underlying growth both year-on-year and sequentially, offsetting the runoff of concentrated client balances. Noninterest expenses and adjusted costs were essentially flat as effective cost management mitigated the impact of inflation and investments in client service.

A release of provision for credit losses, reflecting a release of Stage 1 and 2 and a low level of Stage 3 provisions demonstrates the continued resilience of the loan book. I'll now turn to the Investment Bank on Slide 15. Revenues for the third quarter increased 18% year-on-year with continued strength in FIC supported by a material improvement in O&A. FIC revenues increased 19%, driven by strong performance across businesses.

Macro products and credit trading demonstrated material year-on-year improvements following strong market activity through the quarter, while financing continued its momentum with revenues again higher than the prior year period, driven by an increased carry profile, reflecting targeted balance sheet deployment.

Moving to O&A. Revenues were significantly higher both year-on-year and sequentially, increasing 27% and 22%, respectively. Debt origination was the biggest driver as both leveraged and investment-grade debt grew revenues year-on-year with the leveraged finance market particularly active, having recovered well since the second quarter. Equity origination revenues increased 57%, driven by strong issuance activity, including an improved IPO market. Advisory revenues were essentially flat year-on-year as the industry fee pool moved away from our areas of strength. However, pipeline for the fourth quarter is encouraging.

Noninterest expenses were higher year-on-year, primarily driven by the impact of higher deferred compensation and increased litigation charges. Provision for credit losses was EUR 308 million, significantly higher year-on-year, with Stage 1 and 2 provisions materially impacted by further model updates during the quarter and Stage 3 impairments.

Let me now turn to Private Bank on Slide 16. The Private Bank continued its disciplined strategy execution and delivered a strong quarterly performance. Profit before tax doubled, reflecting 13% operating leverage in the quarter. Return on tangible equity rose to 12.6%, showing robust growth both sequentially and year-on-year. Revenues increased driven by a 9% rise in net interest income from deposits and lending, while net commission and fee income was essentially flat year-on-year.

Growth in discretionary portfolio mandates, specifically in Germany, was partially offset by lower net commission and fee income from cards, payments and postal services this quarter. Growth in Personal Banking was mainly driven by higher investment and deposit revenues. Lending revenues were up slightly, helped by the absence of an episodic item in the prior year. The continued expansion in Wealth Management and Private Banking was supported by solid momentum in discretionary portfolio mandates. Sustained cost efficiency underpinned by transformation benefits led to a 9 percentage point improvement in the cost/income ratio to 68%.

Personal Banking continued its transformation with 24 additional branch closures in the quarter, bringing the total to 109 this year. These actions contributed to workforce reductions of 1,000 in the first 9 months, demonstrating continued strategy execution. Business momentum remains strong with significant net inflows of EUR 13 billion, supported by successful deposit campaigns. Underlying credit trends showed improvements with provision for credit losses benefiting from model updates.

Turning to Slide 17. My usual reminder, the Asset Management segment includes certain items that are not part of the DWS stand-alone financials. Profit before tax improved significantly by 42% from the prior year period, driven by higher revenues and resulting in an increase in return on tangible equity of 9 percentage points to 28% for this quarter. Revenues increased by 11% versus the prior year.

Growth in average assets under management, both from markets and net inflows resulted in higher management fees of EUR 655 million. In addition, performance fees saw a significant increase from the prior year period, primarily due to the recognition of fees from an infrastructure fund. Noninterest expenses and adjusted costs were essentially flat, resulting in a decline in the cost/income ratio to below 60% for the quarter.

Quarterly net inflows totaled EUR 12 billion with EUR 10 billion into passive products, including Xtrackers, which also recorded its best day ever this quarter in terms of net new assets. SQI, advisory services and cash contributed a further EUR 3 billion of net inflows, which more than offset EUR 2 billion in net outflows from multi-asset and active equity products. Assets under management increased to EUR 1.05 trillion in the quarter, driven by positive market impact and the aforementioned net inflows.

During the quarter, DWS received the necessary licenses to open a new office in Abu Dhabi, strengthening its regional presence and client engagement in the Middle East, reinforcing its position as the preferred gateway to Europe for global investors. For further details, please have a look at DWS’s disclosure on their Investor Relations website.

Turning to the outlook on Slide 18. We are on track to meet our full year 2025 targets and remain confident in our trajectory to deliver a return on tangible equity of above 10% and a cost/income ratio of below 65%. Our year-to-date performance supports our revenue and expense objectives. Our asset quality remains solid. And despite uncertainty from developments around CRE as well as the macroeconomic environment, we continue to anticipate lower provisioning levels in the second half. Our strong capital position and third quarter profit growth provide a solid foundation as we head into 2026.

We also completed our second buyback, taking total buybacks in 2025 to EUR 1 billion, and we reiterate our commitment to outperforming our EUR 8 billion distribution target. And we look forward to providing you with an update on our forward-looking strategy and financial trajectory at our next Investor Deep Dive on November 17. With that, let me hand back to Ioana, and we look forward to your questions.

Thank you, James. Operator, we're now ready to take questions.

[Operator Instructions] And the first question comes from Tarik El Mejjad from Bank of America.

Two from my side, please. First, I mean, you printed a strong Q3 results, which put you well on track to deliver on your '25 targets being revenues, cost, RoTE or capital. Can you run us through your thoughts on achieving your '25 targets and whether more importantly, Q4 would see similar or better trend than Q3 or on the flip side, we should expect some -- or could be some negative surprises.

I'm always asking this because it's very important and it sets the tone for the trajectory and credibility of your medium-term targets to be released in 3 weeks' time. The second question, longer term, can you please discuss how a bank like yours would benefit from the German fiscal stimulus? I mean, how important is it as a lever, sorry, to your medium-term profitability? And maybe you can take an opportunity to update us on how the implementation of fiscal stimulus is going and the merits of it.

Thank you for your question. Let me start on both questions. First of all, we agree with you. It's unbelievably important that we achieve our targets for 2025 to further build up the credibility. But to be honest, we are highly confident in doing so. First of all, let me reiterate again also what James said at the end of his comments. A, we are really happy with the first 9 months performance. I think it really shows our strength.

And it also actually shows the continuous improvement, the momentum, the validity of the strategy and in particular, in the times where we are with these geopolitical uncertainties, this concept of the Global Hausbank is actually gathering more and more momentum and clients want our advice, be it private clients, corporate clients, institutional clients.

And therefore, to be honest, I'm really confident that we see this momentum also going into Q4. On the revenue side, look, we had a robust, actually, I would say, a very good start in October on the investment banking side. We have a good visibility when it comes to the pipeline on the O&A side for Q4. And the predictable or more predictable businesses are looking very solid for the fourth quarter, in particular, Private Bank and Asset Management.

On the Asset Management side, it's not yet over the year, but I can -- actually, I would expect higher performance fees even coming in. So there is even some upside to the already quite positive outlook. So from a revenue point of view, while Q4 is always seasonally a bit weaker than the others, but it's actually in line with our plan, even potentially higher than the plan, and that makes me absolutely confident that we can achieve the EUR 32 billion. I think we know how to manage costs. We have shown that quarter-by-quarter. The same discipline will be applied to the cost line in Q4.

And therefore, I think simply from an operating performance, I'm confident that we show another good quarter. From a risk point of view, look, we are there what we told you at the end of Q2 that the second half of 2025 will show lower provisions than the first half. We have started to see that in Q3. And from a credit portfolio point of view, I'm confident. I feel comfortable. We haven't been involved in those cases, which were quite heavy in the media, shows actually the underwriting criteria we have, the discipline we have. And therefore, I'm confident there.

And that shows me overall, while there is always obviously some seasonal issues, but looking actually at Q4, it all adds to my high confidence that we will meet and potentially even exceed our targets when it comes to return on equity, when it comes to the cost/income ratio. And also as important actually to our target to shareholder distributions well above EUR 8 billion. And therefore, I think we also have actually a very, very good capital story, and I'm sure James will talk about that.

With regards to Germany and how we build this into our plan, now I don't want to be defensive when I refer to our IDD in 2.5 weeks' time because obviously, we will talk about that far more in detail. But also, again, for -- or as an answer to your question, look, first of all, I have not changed my view on Germany and the stimulus program and what Germany will do, so to say, over the next 2 to 3 years. The government is clearly reiterating that growth and competitiveness is at the core of their agenda.

And while there is noise about the speed of implementation, which I understand, we all wish even for a speedier implementation, we should also actually think about what has been done next to the, so to say, adjustment of the dead break. And actually, there are very concrete discussions between the government and other institutions, including ours, how to deploy now the EUR 500 billion, be it on infrastructure or be it on defense. But we have seen other reforms on the tax side, the investment booster, initial changes to social and pension reforms.

And look, when we discuss with the government, there is clearly more to come. And therefore, we are very optimistic that Germany is able to grow by 1.5% in 2026. I can also see actually that, again, while the private corporates are calling for even speedier implementation, actually, on Monday, it came out that the ifo Business Climate Index was at the highest level since 2022. Now this is also much needed, but you can see that it's going into the right direction.

You know about this Made for Germany initiative since the start end of July, when I reported here for the first time, we have almost doubled the number of companies which are participating. We are now at a committed number of more than EUR 730 billion of revenues -- of investments -- I'm sorry, not revenues of investments committed for the next 3 years.

So of course, we need to keep the pressure on the government, and that is obviously needed. But I'm actually very optimistic that Germany will leave this flat growth scenario, which we have seen for too long and is coming back to growth. And that obviously helps us and more details on the IDD.

And the next question comes from Joseph Dickerson from Jefferies.

I've got a question first on private credit in a couple of areas. So I've seen your disclosure on Slide 28. And it seems to me that people tend to conflate private credit with other aspects of asset-backed finance and sponsor lending. So I guess, could you just give us your perspective on private credit and the outlook? What are the areas of risk you're looking at? And what are the areas of opportunity that you are also assessing because it seems like only months ago, this was a big area of opportunity for banks. So it would be interesting to have your opinion on the opportunity.

And then just on nonbank financial institutions because I know the disclosure in the U.S. is different from Europe, where I don't think there's a precise definition, but how do you assess NBFIs and counterparties in that regard? So that's, I guess, the first question around private credit.

And then secondly, on the CET1 ratio with the OCI filter and the op risk, which I think was pulled forward in the Q4. Can you confirm that going forward, you'll distribute capital down to the 14% threshold sustainably? Because I think that's an important point for investors.

Thanks, Joseph, for your questions. It's James. I'll -- let me start with the capital item you mentioned. So the short answer is yes. And we feel -- we wanted to indicate with the pro forma we gave even greater confidence about our distribution path from here. And let me just make sure that our comments were understood.

The 2 items that we called out in the commentary are ones that we've talked about before. But we think we're in a position now through the EBA guidance and our own actions to bring both into the year-end ratio. You may recall that we talked about some volatility potentially in the ratio, so a high step off, which would not have given you a clean view of our position going into '26. We think we can now do that.

And hence, the guidance of 14%, we think is really encouraging because it puts us in the position to generate excess capital from the start of the year essentially and then potentially distribute that. Now I'd also make the point that with the interim profit recognition that we have, as we sit here today, EUR 2.4 billion of capital is disregarded in the ratio. So the 14.5% excludes EUR 2.4 billion of distributions that are earmarked for distribution next year.

And of course, 50% of net income in the fourth quarter would also be ready for distribution based on that 50% payout ratio. And then we would be in a position to exceed that based on earnings above that 14% starting point. So we wanted to send a strong message that we're starting at the top of our range. And that gives us greater confidence even than when we spoke a quarter ago.

Just going essentially in reverse order, the NBFI disclosure really isn't very helpful because it captures all sorts of things that investors aren't looking for like clearing houses and insurance exposures and the like. And hence, the additional disclosure that we provided of approximately 5% of the loan book being to private credit. We talked a little bit about the nature of that lending. You asked about the opportunity.

Look, we've been in this market for a very long time. So the FIC financing business is not new for us. We've been in structured credit lending for many, many years. And as a consequence, we think we have real capabilities to innovate and take advantage of opportunities in the market as they develop from here. We also have a good track record in terms of underwriting and discipline against our risk appetite.

And so while we do see spread compression in the business that's coming from the additional capital going into private credit, whether that's from banks or from private credit industry players, we also see opportunities to innovate and grow the book. We've been very disciplined, as I say, in that business, but it is one that we've successfully and I think, profitably grown in the past. And we think that's continuing notwithstanding the spread compression point I made earlier.

Great. So just to conclude on the Q4 capital position, it sounds like you're creating a position of strength for next year.

Position of strength, absolutely. We talked about the OCI filter starting in the third quarter of last year. It was a feature of CRR3 that we and other banks availed ourselves of. So a temporary protection of about EUR 800 million in unrealized losses on essentially sovereign debt. And then we've also talked about the fact that in the old regulatory guidance, we would only recognize op risk RWA increases in the standardized approach that refer to the prior year's revenues.

Based on new EBA guidance, that's expected to be recognized already in the year. And those are the 2 items we're calling out. And the good news for investors is it will take the volatility out of our disclosure, but the guidance of a 14% endpoint, we think, is encouraging.

And the next question comes from Giulia Miotto from Morgan Stanley.

I want to first follow up on the capital distribution point. Is it fair to expect 2 buybacks next year? So one with Q4, of course, and then the second one, I don't know, perhaps towards midyear results given that you start already from 14%, you build excess capital from there and you intend to distribute everything down to 14%.

And then -- and to be clear, I'm trying to confirm that there are no potential downgrades to the at least EUR 1.5 billion of buybacks expected in '26 from consensus. And then secondly, thank you for the additional disclosure on private credit. That's helpful. I think you stated that these are exposures to high-quality lenders, investment grade with conservative LTV. Do you disclose the average LTV and also concentration? How big is the largest exposure? Would you be able to give these numbers, which I think could reassure investors even further?

Sure, Giulia, thank you. So again, going to the distribution piece, yes is the short answer. We're all kind of reacting to the rules as they have evolved in Europe as to how to craft the distribution policies and go through the approval hurdles. But in our case, I think investors should expect that in the, call it, the first half, maybe 7, 8 months of the year, we would be in a position to distribute what is accrued, if you like, on the basis of that 50%.

And then assuming there is in our capital plan, excess capital, then it would take a second application and second approval process to do that, actually similar to what we ultimately did this year. But obviously, as net income rises and the forward view comes into focus, those numbers essentially increase with earnings. The other thing just to point out is that we talked about last quarter the sort of sustainably above concept. And what I want to make clear is that it means that in our capital plan, that amount of capital above 14% isn't just a flash in the pan goes away. But it also means that opportunities that we see in the capital plan as they materialize also can produce excess capital.

To give you an example, FRTB is still in our capital plan and were that to be pushed out or amended that then our capital plan would potentially show additional excess capital. Equally, good news or in the sense of slower demand for capital in the businesses can also create excess capital. So I want to be clear that, that's how it works. But -- and therefore, Giulia, in your framing of it, that's what the second application would then take into account with the passage of time.

On private credit, we do disclose on Page 28, the LTV associated with the -- with that 75% block that we refer to as lender finance. So that's the diversified pools of credit that have back leverage against them, and that is below 60% with an LTV maintenance covenant in, I think, most or all of the facilities. And that's actually reasonably typical of the type of lending here.

In fact, when you go into other types of private capital lending, say, subscription finance or NAV financing, you find LTVs even lower in the case of NAV financing, significantly lower than that 60%. So we take it to be -- except in the case of fraud and fraud only really hurts you when you're in a single lender facility or single asset facility. And we have a very small exposure to that type of nonrecourse single asset as a percentage, again, of that 5% of the loan book. So hopefully, that gives you some color for what the exposures look like.

This was super clear. Just if I can follow-up, can you quantify the exposure to this single lender facility that you just mentioned?

I think it's less than 5% of the 5% by memory. So it's a very small exposure. And actually, I would add to that, Giulia, that in those cases, given that it's single asset, the oversight that we put and the LTVs we're willing to lend at are even more conservative than when it's a pool. So we -- again, no one is ever going to be perfect in lending, but we feel that these portfolios are very robust in terms of their protection attachment points and oversight.

Great. And the last follow-up. The 60% LTV is on 75% of this private credit exposure. On the remaining 25%, what sort of LTVs do you have?

Average would be lower than the given the composition that I mentioned of what is otherwise there.

Then the next question comes from Flora Bocahut from Barclays.

I wanted to ask you a first question on the op risk comment you made regarding the annual update that is coming at year-end. I just want to understand how much of a one-off this is because you mentioned annual event when you comment on it. So is this something that's going to hit again every year? And if so, do you have an idea of the magnitude? So just to assess how recurring an event this could be?

And the second question is on the Corporate Bank revenues. The fee growth is clearly positive, but has been slowing a bit this quarter. The NII declined slightly sequentially, which you commented on. For you to make the guidance for the full year, it would imply a boost suddenly sequentially in that revenues for Q4. So anything you can give us on how confident you are that there is going to be a rebound Q-on-Q in the Corporate Bank revenues in Q4?

Thanks, Flora. Yes, the op risk item is now a permanent feature in the standardized approach to operational risk RWA. It also, by the way, removes the volatility intra-year. So we will record a number in December, and that will be flat through the balance of the year.

I think it runs off a 3-year average. So each year, you have to update for that year's new revenue number in the 3-year. On CB, I do think we're looking at a, what I'll call a trough in revenues. Now I think we want to be a little bit cautious about that prediction. But to us, NII should be passing through a trough, a sort of a mild increase going into Q4. But beyond that fee and commission income, there's always -- remember, a little bit of sequential seasonality.

Q2 tends to be the highest quarter of the year because of dividend season and what happens in the trust and agency business. So Q3 is always a little bit softer. But this steady build of the fee and commission income streams in the Corporate Bank, we expect to continue in the years ahead. Obviously, we'll talk more about that on November 17. But it has a -- so I would expect to see Q4 continue to show momentum, perhaps accelerating momentum against where we've been very recently.

And again, it's a business where you compete for business with RFPs and put on the business. So you have some visibility into, if you like, a pipeline of new activity coming through in Corporate Bank.

Let me just add to the last point. I think this is a really good point James is making. Just take, for instance, the example of Miles & More in Lufthansa, where for the last 2 years, actually, we have invested in the transition now to the Corporate Bank. And that we actually can see on various fronts, in particular, on the payment platforms with supplying new technology.

So I would -- as James is saying, I would expect a slightly increasing number in Q4 in the Corporate Bank. But in particular, the investments we are doing for the fee and commission business are building up and building up. So it's actually quite a nice story. Now even more important is that if you -- despite the Q3 number, which was slightly lower than the consensus was, look at the profitability of the Corporate Bank.

It again increased, and that also shows that more and more we apply technology, and that means that our process is getting more efficient and cost/income ratio is going into the right direction. So overall, despite potentially a non-beat on the consensus of revenues, the overall development in the Corporate Bank makes me actually very confident.

Actually, probably one thing just to add. I think, Flora, you may have asked for the op risk, the RWA number that we're assuming in Q4, it's about EUR 4.5 billion that would, we think, mechanically come into the denominator for the ratio, just to close that gap.

And the next question comes from Andrew Coombs from Citi.

If I could ask one on the Investment Bank and then one on the Private Bank. So on the Investment Bank, if you take the provisions, you talked about model effects driving higher Stage 1 and 2. But perhaps you could elaborate on that and confirm that that's a one-off model change, you wouldn't expect it to repeat.

And then secondly, on the Private Bank, very, very good broad-based strength across both personal and wealth management. It looks like the margin trends you're seeing there, particularly around the deposit book are very different to the corporate bank. So perhaps you could touch upon that. And also the operating leverage in that business. You've managed to grow revenues and still strip out costs at the same time. So where do you think the operating leverage could move to?

So Andrew, I'll briefly take the first item. The -- so look, it was about EUR 100 million of it was in total in Stages 1 and 2. And that was almost entirely driven, I think, by model changes. And it was a probability of default model that we changed this quarter. Last quarter was an LGD model.

And Look, we've been updating the models to reflect where we are today in the interest rate cycle, new data that's come in. But to your question, that we're done for the year. The model adjustments that lie ahead are negligible. And actually, over the full year full firm, the model impact will be -- will also be relatively immaterial. So that's what it is in there. So EUR 100 million of the EUR 300 million was model items, EUR 100 million or thereabouts was CRE.

And Andrew, on the second question. Look, if you compare the Private Bank and the Corporate Bank, we have to be fair because the starting point for the Private Bank, obviously, from a cost/income ratio profitability is a completely different one than the Corporate Bank, and we had to expect these improvements.

Now the good thing is that Claudio is really running a very, very clear strategy in doing 2 things. On the one hand, continuous growth on the top line, in particular, when it comes to asset gathering. If you look at the assets under management in Wealth Management, but also in the Private Bank with the deposit campaign and strategy, it's really looking well. And I told you in my initial remarks to the first question that I expect actually that the private bankers will also show a very solid Q4.

And on the other hand, all the investments we have done over the last years are actually finally paying off in terms of cost saves. And that makes me most confident that next to the nice continuous top line growth, we will see a continued flow of cost reduction because we are going more and more into straight-through processes, in particular, in Personal Banking.

You have seen, so to say, month-by-month new items when it comes to digital technologies, whether it's a new mobile app. And you can see that these investments are paying off and that costs are coming down. We are continuously reducing our branches and move into more digital setup. So that momentum, which you see is obviously forecasted and expected to hold also into the next years. But when you compare to the Corporate Bank, we need to be fair. It was a different starting point.

Then the next question comes from Stefan Stalmann from Autonomous.

I would like to follow up on the point that you made, Christian, regarding the Lufthansa credit card portfolio. I think that's now coming basically on board. Could you maybe remind us roughly of what kind of revenue impact we should expect there? And the second question relates to your very helpful disclosure of the daily trading P&L, Slide 26.

You have now had a couple of quarters where you have very strong trading days very much at the end of the quarter or maybe one of the last 1 or 2 days of the quarter, around EUR 100 million often. Can you provide any color of what exactly is causing this kind of spike towards quarter end? Or is it a pure random walk?

Stefan, thank you. So I won't give you the detailed numbers because it's a one-to-one relationship, and we shouldn't do this. But a, we are in the middle of the transition from an IT point of view, I think this is very important because we talk about a large transition from one bank to the other.

It's going actually very, very smoothly. We started with the pilot at the end of Q2. We have increased the volume then over Q3, and now we are in the middle of moving all clients actually to our offering and very, very encouraging start in October. And overall, it is clearly a revenue increment to the Corporate Bank, which is well in the double digits per year.

And in my view, with more upside. And the more upside is actually the cross-selling, which we are able to do in our Global Hausbank from corporate to private clients. I mean this is the strength of Deutsche Bank that we can now actually apply that to 19 million private clients, and that's what we are going to do.

Secondly, this is a signal to other operators with similar loyal cards and similar systems that Deutsche Bank can handle that, and that makes this business so attractive you think also when you think about other corporate clients. So on the individual clients, clearly value enhancing and good revenues, but I expect far more actually from cross-selling and with other corporates.

And Stefan, it's a good observation that the markets revenues will often have a strong sort of quarter close. It depends on the quarters. But very often, it is essentially as we evaluate reserves, so day 1 P&L and illiquidity reserves and the like in the business that those determinations are made towards the end of a month or a quarter. That is kind of one of the reasons why guidance in the business isn't always perfect to do.

But there's also events during those last, say, 10 trading dates that can influence the result that are part of the, as you say, the actual ebb and flow of the markets. And then there are also some quarters in which we have specific transactions that are taking place and through our systems. that are, if you like, just happening to take place or designed to take place at the quarter end.

This is a quarter where, in fact, we had all 3 of those things. So it was a very strong finish. But to your question, it's not entirely accidental that the quarter can finish strong, especially with the reserve releases. And some of this is difficult to predict precisely.

And the next question comes from Nicolas Payen from Kepler Cheuvreux.

I have 2 questions, please. The first one will be on your structural hedging actually. Could you tell us how you think about your structural hedge supporting your NII trajectory for the next few years? Because at the end of the day, it's supposed to become a strengthening tailwind.

So if you just could discuss how you think about it and also maybe with your strong deposit performance, especially in PB, could we see further notional increase supporting further your NII trajectory? And the second one would be on your loan development, especially on the investment bank has actually been very strong. And just wondering what drove that strong increase sequentially.

Nicolas, thank you. So yes, and I would point you to the disclosure on Page 24 of the deck, where we show you the hedge amount and the future benefits we expect from the hedge. The answer is we are relatively programmatic about our Caterpillar. So the assessed duration of the deposit books and rolling over the hedges of that. And you can see in the disclosure. And of course, that increases as the deposit books grow and particularly as the Private Bank deposit book grow because it's longer -- it's deemed to be longer tenured or modeled as longer tenured, and it is more euro-based than the corporate bank book.

So that -- what we're showing you is essentially what that -- just the model or the hedge revenues will be in the future, and they do benefit from growth. Think of it as a static portfolio here, but growth in deposits will increase that going forward further. I want to make one other point here. I think we asked -- we've talked to this in one of the previous calls, but we also take positions to anticipate deposit growth or protect ourselves from specific market environments that we see. So it is a little bit more dynamic than simply this one 10-year Caterpillar.

But in essence, it produces the revenues that you see here. What's driven the loan growth in the Investment Bank? Over the course of the year, it's principally been in the private credit portfolio that we talked about. So we have seen good opportunities to deploy the balance sheet there. But also O&A has seen some growth essentially as the business grows and we see more activity, you've also seen some deployment there.

And the next question comes from Tom Hallett from KBW.

So firstly, I'm just wondering if there are any underperforming assets on your books, which may be deemed noncore? Because I can see some articles on the DWS data center sale in the pipes. There's previously been talked about India and possibly Poland.

And then secondly, maybe thinking a little bit ahead and possibly to the Investor Day, but will you look to run the business on a cost/income basis or an operating leverage basis or absolute basis? And what are the hurdle rates for allocating capital out to the businesses? And I kind of say that because I see the allocations continue to increase towards the Investment Bank.

So Tom, I'll take that, and Christian may want to add. Let me just, first of all, say that I don't want to speak to specific actions or events in terms of things we might exit until we're done with that. And -- but certainly, we're looking at the businesses, and we've talked about this since Q4 with this SVA shareholder value-add lens with a real focus on driving more of the balance sheet to being above hurdle and showing real discipline there.

Now, there are a number of ways to do that. It can be pricing. It can be, again, reallocation of capital internally. But we do have that discipline, and we'll talk more about that on November 17 when we come together for the Investor Deep Dive.

I think you said it all. And the only thing is, Tom, I think we already started to implement that step by step. You have seen some action already in the German mortgage book where Claudio decided to exit sub businesses exactly for that reason.

I think we are now in the position to do this, whether it's on the pricing side, whether it's on the more consequent capital allocation. So as James is saying, you will hear far more on that in November 17, but I can also tell you that we started to do that, and it shows the first very positive impacts like you see in the Private Bank.

The next question comes from Anke Reingen from RBC.

The first is just coming back on private credit. I mean, I guess you gave quite a lot of detail on the credit side. But can you sort of like give us an indication on how much the business has sort of like contributed to the top line business of private credit and driven the growth just in terms of is there could potentially be a risk if that area is becoming under more scrutiny?

And then secondly, I know we have your Investor Day coming up in November, but just looking backwards and acknowledging 2025 isn't quite completed. But if you look back on the 2022, 2025 plan, what are sort of like the lessons learned in terms of good and bad when you embark on your new plan?

Goodness. The second is a long open-ended question that I might give to Christian, but we'll both have, I think, lessons learned to share from the last several years. Look, I would simply point to the financing, the FIC financing revenues you see on Page 15. And obviously, it's not all private credit. There are other activities than private credit in there, including incidentally commission and fee income that typically is earned from distribution of assets. So whether it's asset-backed facilities or warehousing of, say, CMBS before issuance. So there's a bunch of things going on.

To your point about risk, look, it's a banking book business, which we think is attractive in terms of its stability in the revenues, its predictability in terms of the spread that we can earn and its risk profile. I mean we've been -- as we're preparing for today, we've been racking our brains as to whether we have had a risk event, sort of a loss event, at least in the portfolios we've been talking about today. And I said earlier that we think we've got some really good intellectual property. So is there a risk to the business in terms of a difficulty in the cycle potentially.

But to be honest, given the nature of the business, we don't really see that or our own appetite, acknowledging that our appetite has been disciplined and consistent over the years as we've been in the business. So the short version is we like the business. We think we can continue to grow, but we'll grow in a measured and sort of risk-appropriate way.

Look, Anke, really good question. And I actually need to think a little bit longer about that. But let me start with 2 or 3 lessons learned from a good point of view, from a good side, and then I'll give you also one where I think we could have done better.

Number one, remember when we did this, that was 10 days after Russia invaded Ukraine. And a lot of people told us, don't go for an IDD, and we did it. And that shows our underlying confidence in this bank, the strength of this bank, that the Global Hausbank is exactly the right strategy and that we continue with that IDD.

And to be honest, I'm really proud of this organization, what they have delivered in those years, which were full of uncertainties, but they kept to the plan. The team worked very, very hard. And I think it was at the end of the day, exactly the right decision to go out. And that was the first thing that if you are convinced with something, you should also be courageous, and we did this, and it was the right thing.

Number two, lesson learned whenever you do an IDD, you need to take your team on a journey. And it's not only, so to say, for the market and for you, but it's also something where you need to motivate 90,000 people. And I think we did this. Can we do even that in a better way? Yes. And we learned some lessons, and you will see it then on November 17 when we talk about how we carry that out internally because it's a story not only for the market, but for our people because our people are driving this bank.

Number three, I think the Global Hausbank strategy in itself, huge success. And as I said, we can see that it's developing better and better from quarter-to-quarter because people want to have their anchor in times of uncertainty, and that's actually we are that European answer to that.

Number four, with certain, so to say, portfolio decisions, we could have been more consequential, I would say. And that is certainly a lesson which we have learned. And you know what, there is now time to correct that. And therefore, I'm looking forward to the next IDD.

And the next question comes from Chris Hallam from Goldman Sachs.

So 2 for me. And the first one, once again, on capital. So 14.5% headline CET1, 14% pro forma for Article 468 and the op risk headwinds that you flagged. So you should see around 20 or 25 basis points of cap gen via retained earnings in Q4. So I guess, finishing the year 14.2%, 14.3%. You've mentioned you want to finish around 14% -- so I guess just anything else to flag in Q4, maybe on the RWA side or on an accrual rate above 50%?

And then anything you can already see coming early next year? I'm just trying to think about what sort of position you're going to be in by the time we get to Q4 numbers in the AGM.

And then the second, which is a slight follow-up to the points you made earlier, Christian. In the Private Bank, you've kind of had this story so far this year of growing deposits but declining loans. And so what's your best sense of how that evolves in the coming few quarters or through the balance of next year because rates are coming down, borrowing is becoming more affordable. The economy is doing a bit better. You've been investing in the digital setup, as you mentioned. But then against that, you've got this capital discipline focus. So I'm just trying to get the balance of perspective there.

Thanks, Chris. It's James. I'll take the first, and I think Christian will do the second. Look, the only thing that is at this point now seasonal, given the adjustments we walked you through is really the share repurchases we do for equity comp delivery in the first quarter. Now the first quarter tends to be seasonally from an earnings perspective, also among the strongest. But otherwise, it is simply the math of organic or net income less the 50% payout assumption and then offset by growth or demand in the businesses.

Now sometimes we overestimate demand. And that can, as I said earlier, produce excess capital, but we, of course, wish to support the businesses, support clients with the capital deployment. So we want to be reasonably conservative in our capital planning to ensure that we have that room to grow. You have had lots of changes in rules and methodology and so on over the years. I would see that slowing down now that we're in CRR. That should become more-rare.

Now, I want to be careful about a forward-looking statement given how much is built into this. But internal capital generation, all of that considered in a range of about 25 to 30 basis points has been -- if you peel through it all, kind of a norm. And the question is going to be where all of the ingredients fall out going forward. But short version is we do feel we're in a strong position to generate excess capital and do so kind of on an accelerating basis in the years ahead.

Look, Chris, on the Private Bank, we clearly have our plans to continue to grow deposits and use that kind of attractive funding to replace more expensive sources. On the business overall, I would say we expect a flattish loan growth in Private Bank overall.

Now clearly, some growth to see in Wealth Management. I think it's an attractive area where we can actually grow, and we have plans to do so. In other areas in the Private Bank when it comes to mortgages, I would say it's rather flattish because, again, we are absolutely measuring that portfolio via SVA. And if it's not value accretive, we won't grow that. And overall, in the Private Bank, like I said before, Chris, if you look out longer for the next 3, 4, 5 years, the real big upside in the Private Bank is on the asset gathering business and on the investment business.

And not only with our market position in wealth management, but in particular, when it comes to retail and personal banking. And that's all tied to the plans of the German government because you will see that next to the state pension, there is a necessity that on the private side, people need to do more, and this is where we are looking into.

There, we are working on a digital offer. There, we are working on offers for retail clients to grow that business. And if you think about our Postbank clients, which are the majority of the retail clients and their access to those products, it's actually, for the time being, not very much used, and that shows the opportunities we have in that business. So our focus when it comes to the Private Bank is clearly on the asset gathering side.

And the next question comes from Jeremy Sigee from BNP Paribas Exane.

Just a couple of follow-ups, please, on the Private Bank and the Corporate Bank. On the Private Bank, you talked about further cost savings. Are there any step change cost saves still to come through in the Private Bank, particularly from integration-related or system takeout? Any step change?

Or is it just incremental process efficiency kind of bit by bit from here? And then second question on the Corporate Bank. You mentioned growth in trade finance year-on-year. And I just wondered what areas that was coming from? Is it Germany, Rest of World, any particular industry sectors?

Jeremy, on the Private Bank, to be honest, let's also wait for the IDD because you get a quite good outlook for the next 3 years, what we are doing there. But it's a continuous improvement. Continuous improvement from actions which we have started to implement. If you think about the plan how to reduce branches and make that business more digital for our clients, then this is something which you plan in '23, '24. And we now see the effects.

And therefore, I'm so happy actually with the quarter-over-quarter cost takeout Claudio can do in particular in the personal bank, but that is going to continue because we know already now how many branches we close in '26 and later on.

Secondly, we are working constantly on straight-through processing, and that is with regard to payments, that is with regard to the lending process, that is with regard to the investment process. And that is the reason why we have changed the bank initiatives and investments, and you will see that as obviously then cost efficiencies going forward. So I would expect a continuous improvement on that side, but more details in the IDD.

And Jeremy, I'm not aware on the trade finance question, I'm not aware of any particular sort of trend or concentration that we're seeing in terms of where the growth is coming from. You'll recall that we've been sort of waiting for the growth from the balances. We kind of were stuck at that kind of 115 level. We do now begin to see some growth. And the place where our emphasis is in structured trade finance. And so that's really the business that we're seeking to grow.

And the next question comes from Mate Nimtz from UBS.

Yes. Just 3 shorter questions, please. The first one would be on the IB. In the cost base, G&A expenses show about a EUR 100 million increase quarter-on-quarter. I'm aware that some of that is some pickup in nonoperating items, litigation. But any further explanation on that step-up? And how should we think about the year-end from this perspective?

Then the second question is still mainly staying with the IB commercial real estate. Could you give us an update on that asset class on that part of the book? Provisions are still at a high level, particularly Stage 3. I think in the commentary, you called out on the slides, West Coast defaulted assets still. Any thoughts you can share on the outlook in Q4 and next year would be helpful.

And just the last one on the Private Bank, and I'm cognizant this is something you'll talk about, hopefully, in 2.5 weeks. But we are seeing a return on tangible equity now firmly above 10% for the second quarter in a row, 12.6% in Q3, impressive step-up from a mid-single-digit level in the previous couple of quarters, and that's without much movement, obviously, on lending. Is this the bare minimum level we should be having in mind as a base going into 2026? And any further improvement on the cost side or coming from investment products will offer the upside. Is that the right way to think about it?

Thank you for your question. I take the last one. Look, we clearly expect further operating leverage in the Private Bank, and we will talk about that in 2.5 weeks' time. But very happy that we are above 10%. That's what we promised you. That's what we delivered. And from here, the way is up.

And then, Mate, on the 2 items you said on IB cost base, nothing noteworthy there. There was a bank levy that we booked in Q3 that gets mostly allocated to IB and then some odds and ends in terms of professional services, market data going up and the like, but nothing that I would call out.

On CRE, we talked about this going on, I think, 2 years plus. And there's obviously been a cycle and that cycle has taken us close to the severe stress that we initially called out on a -- for the stress tested portfolio. I do -- while I'm cautious about calling an end to this, and I don't think we're there. There's still going to be some provisions, we think that will come in time. But as I've said before, they tend to be valuation adjustments on existing defaulted positions.

And in a sense, they're becoming more and more concentrated, as we called out last quarter in the West Coast of the United States in the office portfolio. So as that sort of bleeds out and comes to a steadier level, I would expect to see this begin to fall off in the next several quarters. And you've seen, again, some signs of strength as cautious as I'd like to be on East Coast, I think office has significantly recovered and other aspects of commercial real estate outside of office have been strong. So we're looking at it as we think in a healing process.

And the next question comes from Kian Abouhossein from JPMorgan.

Just coming back to CRE. On Page 29, if I look at the Stage 3 loans in the IB, I guess that's where the -- some of the CRE issues rose. And just trying to understand if you can give a little bit more detail, is the several loans? Is this 1 or 2 loans where you had default issues?

And coming back to the outlook question, I mean, if I look at the comment on Page 30, advanced stages on the down cycle reached, but U.S. office headwinds remain, considering most of your book is actually office related. I'm just wondering what gives you the confidence on your previous statement, the last question that actually we're going to see an improvement here considering your low coverage levels? And then the second question is on...

I'm sorry go ahead.

Apologies. Risk-weighted asset outlook. How should we think about the risk-weighted asset outlook? Should we think about it's going to remain flattish going forward? Or should we think about growth, but then you potentially have further optimizations to do, which leads to the flattish number, i.e., growth with this net is what I'm trying to get to.

Yes. So Kian, thanks for the follow-up. Look, it's a handful of loans. And I'd say concentrated in this quarter, say, less than 10. So there was a concentration of events that -- where we saw valuation changes. And one thing I've been tracking now for several quarters is the number of loans that is coming up for refinancing or extensions where we see either events or new appraisals coming down the pike.

And Kian, the answer to your question is those things are beginning to slow down, what I'd call perhaps the forward-looking indicators on these things. So again, I want to be cautious now having thought we'd found the bottom and discovered false dawns, but it does feel like it's very late cycle at this point on this down cycle in commercial real estate.

On RWA, to be honest, we'd like to see healthy growth just of the businesses and client demand. And as I said earlier, we think our capital plans absolutely accommodate that growth. But to your point, we will continue to work on efficiency and also sort of portfolio collect -- sort of concentration, if you like, or optimization as time goes on. And we think that, that can contribute to even further improving revenue to RWA profiles and more efficient capital usage. And that would be an offset to the simple, if you like, unweighted growth in the balance sheet and business.

And just on -- when you say you're coming to the kind of end of the cycle of these kind of readjustments on the loans, the duration must be quite long in the CRE book, more than 2 years at least. So I'm just wondering why we would think about having reached the peak or maturity of the cycle of making adjustments at this point?

Typically, Kian, 5 year -- the structures typically are 5 years. They tend to be extendable. And so -- and the point to your question is we haven't done a great deal of new lending. So this is a portfolio that's now quite seasoned in terms of either having been extended and refinanced or having gone into default and through sort of a restructuring or into real estate owned.

So it's really a question of seasoning of the existing portfolio and a forward look on to loans, as I say, that are coming up to events. But those that are still open are robust properties. And that's other than a handful, and that's really what's giving us a forward view.

So it looks like there are no more questions at this time. And I would like to turn the conference back over to Ioana Patriniche for any closing remarks.

Thank you for joining us and for your questions. For any follow-ups, please come through to the Investor Relations team, and we look forward to speaking to you at our fourth quarter call.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for joining, and have a pleasant day. Goodbye.