Deutsche Bank Aktiengesellschaft (DBK) Earnings Call Transcript & Summary

Perfect. Good morning. And thank you for joining us today for a fire-side chat with Christian Sewing, CEO of Deutsche Bank. Thank you for being with us, Christian.

Thank you.

I have a few questions to ask you, but -- and then our audience as well, I'm sure, but before we do that, let me ask the audience a polling question. So -- and it's always the same question but with different options. So what is the most important thing for Deutsche Bank's share price performance over the next 12 months, in your view? First, delivery on the cost base; second, additional buybacks ahead of consensus EUR 1.1 billion expectation, which includes the EUR 675 million already announced. The third is revenue momentum, especially in the IB. And then the last point is asset quality with no major or -- issues in commercial real estate. [Voting]

Okay, a mix, the -- but number three, revenue momentum in Investment Bank. We will touch upon that.

And so Christian, let me start with a question on strategy. You have successfully completed the compete to win in 2022. You have now moved on to the Global Hausbank strategy. And you have -- you are really transforming the bank, so can you tell us, where are you on the journey? And also what sort of feedback do you get from clients in how you're helping them as part the strategy?

Yes. Thank you, Giulia. And good morning to everybody. I'm glad to be back here in London despite the weather, I have to say, when I landed this morning, but it is what it is. Look. I'm obviously quite happy with the way we have built it up over the last 5 years because it was a very structured plan. We knew in 2019 that it's kind of a 2-phase transformation. The first phase was, as you said it, compete to win. This was all about resetting, focusing the bank focusing on 4 running engines, the Asset Management, the Private Bank; taking the Corporate Bank out of the Investment Bank because for Deutsche Bank the soul of this bank and the reason why Deutsche Bank exists and started to exist in 1870 is the Corporate Bank; and then a more focused investment bank. And at the same time, we knew that we were far too expensive. We had far too high costs, so we took 3 billion of costs out. And we reduced the balance sheet by quite a lot, a 3-digit billion number in terms of leverage, a 2-digit billion number in terms of risk-weighted assets, so that we could finance the whole transformation by ourselves. And I would say that this compete to win in the first 3 or 4 years was -- or actually 3 years was decisive to give us then the foundation for that what we announced in early 2022, the Global Hausbank strategy, where we said now we want to sustainably grow. And in this regard, Giulia, I'm happy and I'm encouraged with the progress we have done. And you have seen us at the start of the year, where we increased actually the growth expectation we have across the bank. We used to have, we announced a 3.5% to 4.5% revenue increase for the years '21 to '25; and we upped it now to 5.5% to 6.5%. And everything what we said 6 weeks ago holds true, so I see these 4 engines running well. And in this regard, we can confirm our revenue target of EUR 30 billion for this year and EUR 32 billion in 2025. We are doing the progress which we have to do, which was one of your questions, on cost cuts. You know that we have the goal of EUR 2.5 billion, majority of that until 2025, and we are on a good way. And we are halfway through taking out the EUR 25 billion to EUR 30 billion of risk-weighted assets or having a relief there in order to free up more capital which is then also used for distribution. So overall I would say, the first part, restructuring the bank, focusing the bank on the strengths, really helped us then to invest into the business. And the growth which we are now seeing and the investments which we have done in the various business are starting to pay off, so I'm happy. And that's the feedback of the clients. And whether it's corporate clients, private banking clients, institutional clients, they are actually, in my view, quite positive in working with Deutsche Bank. And of course, each re-rating we got also from the rating agencies helped us to again onboard or do more business, so overall, I think, quite a nice story.

And if I start with Corporate and Private Bank; and indeed with the Investment Bank, later. So at the full year results 6 weeks ago, you reported quite an exceptional performance which -- in both corporate and private top line, which was driven by strong net interest income, so can you talk a little bit more on the outlook for these businesses, corporate and private, in Q1 but also 2024 overall, in particular for the noninterest income revenue side of the business? And how do you see interest income normalizing [ for that ]?

Yes, very happy to. So -- and as you are saying, we were very pleased with both the results of the Corporate Bank and Private Bank on the top line in 2023. And you are right. It was also driven by net interest income, but I also have to say that actually there was a lot of talk already since June or July, in particular on the corporate side, that we will see NII to come down far more strongly than we have seen it. And I think we have done a good job in investing into the Corporate Bank for the last 3, 4 years actually to build up other businesses than just focusing on NII. That was always our strategy and this starts to pay off. We gave you the example in platform business, in the card business, in the Miles & More businesses. All these contracts which -- and mandates which we are winning are obviously helping to take a little bit the pressure off, which obviously we also see and which we also indicated to you when it comes to the NII outlook for '24 overall, that we are trying to compensate that with other fee business. And also, again, also in the first quarter, I have to say that the NII development is still satisfactory. So I would say that, in the first quarter, the Corporate Bank is kind of essentially flat with regard to the fourth quarter of '23. And that shows, I think, the strength of the bank in having a diversified business mix in the Corporate Bank. Not only focusing on NII, but now the investments on fee-related business are really coming through. Let me also say something else. And it may sound odd, but the geopolitical situations which we have around the world is actually a key reason while corporate clients are actually needing advice in building up a more diversified network, thinking about risk management tools. So what they need is actually a bank which is global. They would like to have, in particular in corporate banking, an alternative to the U.S. banks. And we have the global network. We have, through the Investment Bank, all the tools on the risk management side so that we can offer something to our clients, in particular in these quite challenging situations which we have around the world, which fits their needs. And therefore, it's another reason that we are doing quite well also in those business which are not NII-driven. On the private banking side, as you're also saying, good year, 2023. I'm also encouraged actually by the start into the year, if I think about assets under management going into the right direction, but of course, as we indicated for the overall group, we have a headwind in terms of NII in 2024 of approximately EUR 500 million to EUR 600 million in 2024. And in the Private Bank, versus the fourth quarter of 2023, again we are, in the first quarter, essentially flat, potentially slightly, slightly down versus the fourth quarter, but overall I would say that also in the Private Bank I can see, with everything what we are building, very stable revenues actually in '24. And then don't forget that, given our positioning, we actually have on the NII side upside in 2025. So that's actually also giving me for the private banking side a lot of comfort. Last but not least, we should not forget the big transformation of UNITY is behind us. A lot of focus, managerial focus, even focus of salespeople, people who are doing the revenues, were done and were focused on the UNITY transformation, i.e., doing the IT migration from Postbank to Deutsche Bank. That's behind us, so I actually see a lot of focus now on the client-related side. So overall encouraged, but obviously we need to take to -- into account that what we said, that there is some NII headwind in 2024.

Excellent. And if we move then to the Investment Bank and we start with fixed income. I think people find it a bit difficult to forecast. 2023 was very strong, up -- EUR 8 billion. We have the ratings upgrade, which I think helped bringing new business in, and potentially or potentially not the Basel III end game in the U.S., so how should we think about fixed income in Q1 but also for 2024?

Well, I'm positive. And I'm again quite happy with the start, but most of you know that I'm a risk manager by training. And we have today the March 12, so we have approximately 14 business days left. And therefore, I never want to preclude too early on a quarter, but as far as I can see it right now, in the FIC business, where we actually outperformed our peers in 11 out of 14 quarters over the last 3 years, I think we have a chance to be slightly up year-over-year, again subject also to that there is not a change over the next days. But overall, I think Ram has built actually a fantastic FIC business around the world. I think we have gained market share in particular in Europe. And you just said something very important, and that is the rating upgrades. Don't underestimate also what the last rating upgrade of S&P meant to us, in December. And it is not the fact that this immediately goes into the revenue line, but it takes between 3 to 6 months in order to renegotiate the [ historic agreements ] and in order to kind of trade even more or to onboard new clients and then start trading. So I think we have a good chance actually to actually be even up year-over-year also in FIC if we maintain that [ what I can see ].

If I move on to, instead, Origination and Advisory and 2 questions. I mean, yes, the short term, everybody is really bulled up about the pipeline coming back. And DCM volumes seem on fire, according [ to the logic ]. But also more strategically, the Numis acquisition, how is that going? What is that bringing to Deutsche?

Yes. You have seen us potentially a little bit against the cycle that we invested last year not only in Numis, and I'm happy to talk about that, but also that we actually did selective hirings of 50 to 60 investment bankers around the world, in particular into our investment banking coverage, in order to strengthen our industry expertise, strengthen our seniority coverage around the world but also go into regions where we used to focus on a decade or 2 or 3 decades ago. I've been with Deutsche Bank for 34 years, so I know that we were strong in Latin and South America then we reduced it. And now we are back, in particular, in Mexico and Brazil and have a team there. And I'm excited actually how they started to actually run and hit the ball. So that's really impressive. Now in the O&A business, as we heard from our colleagues, a very strong start on the debt side, also on the leverage side, so really good momentum, but I would also say in the more capital-light business, i.e., M&A, not that much ECM but M&A, we can see a nice buildup of mandates. So everything what we invested a year ago is now actually starting off to pay benefits. And therefore, I'm -- I know again it's early in the year, and therefore, I have to say it like that, but for the first 6 or 7 weeks in the year, our market share in the O&A actually increased by 90 basis points. Now if you think about, if you just think about what that could mean in case we are able to run with that increased market share through the year -- and this is exactly, by the way, what we were targeting. We were targeting increasing the market share in O&A to 3%. We are now approximately at 2.7%, 2.8%. So if we think about that there is a fee pool of, whatever, 70 billion or up to 80 billion this year, 1% market share is a lot of money. And this is exactly what we can see in the first 6 to 8 weeks and again it goes back to the point I said before. The corporates around the world want to have and are in need of more strategic advice also to think about the risks diversification than kind of ever before, at least in the last 10 years. And for that, they would like to have a European alternative. And that's what we are trying to grab, so I'm quite encouraged here with the start, but of course, in particular if ECM and M&A is further driving, then we will even see then better numbers. On the Numis, I'm really happy that we have done it. It's not only an addition to our Investment Bank. I'm standing and I really do believe that Deutsche Bank is the Hausbank for corporate clients. And that means that we are not only doing the strategic advice but that we can actually offer to these clients also the day-to-day banking. And that is the major change what we have seen over the last 4 or 5 years, that Deutsche Bank -- with our existing client base, we have shown them that we are in to do everything. Not only the strategic advice, but we want to be the provider, day by day, of those needs which are as important [ like strategic ones ]. And that is cash management. That is trade finance. That is the day-to-day guarantee business. I want to make sure that every treasurer knows exactly that -- when he or she goes into her office on a Monday morning, that salary payments are done, that cash management around the world is done, that we have the up-to-date systems. That is what Deutsche Bank is all about. If we are good on that level -- and here we are good. You have seen the development of the Corporate Bank. Automatically you get the trust and the belief of the C-suite. And then we are also qualifying for strategic business. And therefore, Numis is really interesting for us because obviously it gives us the access to 170 corporate clients in the U.K. And the overlap is quite, quite limited. It's actually less than 10 clients in the U.K. which we had, but we also have now the inroads to also offer other services like corporate banking or private wealth management.

Perfect. That was very useful. If I now change topic and talk about asset quality. I have to ask about asset quality. So 2023 cost of risk 31 bps. And the guidance is still for 25 to 30, so there doesn't seem to be any deterioration. And how are you seeing that in your book? Is there any area that you're looking at more closely, anything that worries you? Or still very benign.

Well, no, there is nothing which really worries me because I think we have seen for years and years that we haven't done quite a bad job in underwriting credits, even through times where Deutsche Bank was overall having potentially other challenges. On the credit side, actually, we did well. And we kept this underwriting profile, this underwriting discipline, so it's not that I'm worried, but I would say that '24 is a year where we are again seeing, for our standards, elevated provisions. And that means we are between 25 and 30 basis points. And I would not be surprised if we are at the upper range of this 25 to 30 basis points for the year because there are a lot of uncertainties in this world. We have asset classes like commercial real estate which obviously face some challenges. And therefore, I'm confident that we are within that range but at the higher end of the range. And I would even say how the overall loan loss provisions are stacking up that -- I personally think that we see loan loss provisions in Q1 and Q2 which are closer to the Q4 loan loss provisions. And then we'll see some relaxation actually in Q3 and Q4, so overall a confirmation of that what we said, the range, but given where the world is, I would say it's a little bit more on the high side of the 25 to 30.

Right. And specifically, so let me follow up there, on commercial real estate, right? Because you've got some exposure in the U.S. as well and, of course, in Germany and some more. So what are you seeing there? Are you -- like is the environment deteriorating? Or how are you assessing your portfolio?

No, there is no deterioration. Also, on the quality of our book versus that what we have said at year-end, really no deterioration, but it's also not that we are now seeing the big rally on -- in that asset class. But what makes me comfortable with that portfolio is that the U.S. real estate portfolio which we have and our focus is EUR 17 billion, so 1-7. Out of that, we have EUR 7 billion in the office building. And out of that, we have 85% in class A real estate, so I would say that we see, to your question, 2024 provisions for commercial real estate in line with '23. I don't see a deterioration, but certainly this year is, in my view, a year where real estate -- where you don't see a big relief to the overall challenges in that asset class.

And I'll open it up to the floor shortly, but I just want to ask a couple of more questions, and one is on costs. So high conviction on the EUR 5 billion number is what we heard. EUR 5 billion per quarter underlying number is what we heard in Q4 call, but yes, in Q4, you were at EUR 5.3 billion, so can you just give us an update on how is the project on stabilizing on that EUR 20 billion per year going?

EUR 5 billion for the first quarter. I promise that we will make it happen. It will be the case. And I'm quite confident that we will be also around the EUR 20 billion which we indicated already for 2024, so we are working on a EUR 5 billion for each quarter. Now I can't give you for now, for Q2 and Q3, the forecast for the last 10 million (sic) [ EUR 10 billion ], but you have my full confidence on EUR 5.0 billion for Q1.

Okay...

And overall, why? Because I can see each and every -- a program. We have EUR 2.5 billion of cost takeouts. Out of that, EUR 1.3 billion have been realized. Either it's already in the savings or it's completed and we know it's now coming into the savings. And for the rest of EUR 1.2 billion, we know, up to a single-digit cost measure, where we stand and when it's implemented and when we can see the impact on the P&L. Actually we are even working on initiatives beyond EUR 2.5 billion. I don't want to commit to that yet, but we are, of course, working [ to that ]. And the maturity phase, the way Rebecca is tracking that on a week-by-week basis, gives me all the confidence that this cost goal which we have given to the market is something which we will achieve.

In '24 and '25, so you see that it's flat essentially...

So that is our goal. Again I will not, for now, for '24 give you the last confirmation on the 10 million (sic) [ EUR 10 billion ], but the EUR 5 billion for a quarter on average is our target. And for the first quarter, we will achieve it.

Capital. So Deutsche seems to have hit a sort of inflection point, right? Now we're talking about capital distribution. You promised EUR 8 billion. Probably -- well, for sure, you will be above that, so when you think about capital allocation, what is your priority between capital distribution, business growth and other uses like, I don't know, potentially some bolt-ons?

Well, first of all, I'm quite happy with this, with the capital management exercise which we have done. And that only brought us into the -- a position, Giulia, that what we said that we would like to target and are targeting, a 50%-50% allocation, 50% distribution, 50% using for business growth; and potentially also a little bit for regulatory items which still may come, but -- so we really would like to go for this equal allocation. And on that, we made it clear that we have this -- or we want to continue on our path to increase the distribution by 50% year-over-year. And with the progress which we have done not only on our profitability but also, under James and Olivier's leadership, to get EUR 25 billion to EUR 30 billion of risk-weighted assets down and that we are -- already, at the end of last year, I think we achieved -- I need to look. I think EUR 13.1 billion at the end of December. And obviously this is an exercise which works on a weekly basis to think about where else can we take capital out. How can we reprice? That makes me comfortable and very confident that we can achieve our goal to absolutely and substantially allocate, out of the 3 billion of additional capital, a substantial part to the investors.

Yes. That's clear. So let me see if we have questions from the room. One, [indiscernible], I think.

Yes. And what would be your worst possible scenario for accomplishing your plans? Would it be that the economies accelerate globally and then your absolute cost target gets impacted by the need to grow risk-weighted assets revenues faster? Or would it be the opposite, that actually Germany and global PMIs never recover?

Look. The answer to that question is neither of your suggestions. The answer is that we would lose management discipline. This bank has such a potential on the revenue side and if we keep the discipline in underwriting our risks and managing the cost. And therefore, I was just so firm on the cost number now in the first quarter. It's all about discipline. It's all about transparency. It's all about giving [ out ] plans, monitor these plans, having structural cost reliefs over the next month and quarters and working that down. And therefore, I would say the biggest risk of not meeting our plan, as far as I see it -- can see it right now, is actually that we would kind of lose the management discipline to continue the way which we have done over the last 3 or 4 years. And that's in particular my task to, again and again, have this rigor, that discipline and also this call for action and always the sense of urgency. Look. On the overall global economic development, the nice thing about Deutsche Bank is actually our regional diversification. So our home revenues are between 35% and 40% of the revenue -- of our total group revenues. Germany, as we all know, is struggling for the time being in terms of growth. We have 0 growth in that country. Actually it doesn't really impact us because, the corporates which we are working, usually the export ratio is 50% to 60%. We are doing a lot of international trade business with them; and this is not even bothered by, for instance, the regional development. We are strong in the U.S. We are very strong in Asia. The trade corridor Asia-Europe is working pretty well. And as I said, in particular in times of geopolitical uncertainties, the need of corporates but also private clients to actually get advice from banks is very, very high. And that is -- and from that, we are benefiting, so I would go back to the point. It's actually our discipline and our clarity of managing this bank into the direction we set forth. If we continue that, I'm actually quite relaxed.

Let me see if there are other -- yes, there is another question over here.

Just to ask about using capital beyond looking inwards. And it sounds like there's a big focus on executing internally, but you did do Numis. How do you feel about further acquisitions, whether it'd be similar to that or beyond, in Asset Management, beyond banking et cetera?

Look. It is always hard and it is wrong to exclude something completely. And therefore, in particular if we see what we have done with Numis, if there is a brilliant opportunity in particular in the Corporate Bank or in the Asset Management that we have an addition, kind of we call it an add-on, not a big acquisition or a merger or something like that but smaller sized -- of course, we are looking into the market. What kind of offerings are there, also from a technology point of view? But I would tell you we are rather conservative there because I think each and every -- even if it's -- a small add-on acquisition takes a lot of managerial capacity. There is always a risk attached to it from a cultural integration. And therefore, I think, also with the past, Deutsche Bank has -- and again, I've seen that over the last 30 years. There must be a lot of convincing arguments to go for another smaller add-on, but if I would completely rule that out, I wouldn't be honest. But the real focus of this management team is organically grow this company. And that's again what I can see with the feedback we get from corporate and private clients. Now we fixed also a lot of things on the regulatory side. There are still things which we need to do better, but it also means that we can think about growing again, for instance, in institutional cash management. It's a real good business where we are now onboarding clients again. That is all organic. And I'd rather grow organically than taking the risk of buying something, and therefore, I have a clear preference.

Perfect. Let's see. We have another one here. The microphone is coming -- no, third [indiscernible] third row.

Just one quick one. I think you have -- your CFO made a comment a few weeks ago around the AT1 not being really a product you guys like. And I wonder if you have anything to add to that.

Well, my CFO is so good that I would never say something different than he does, but again, I mean, for that, I can tell you a -- at least now a funny story with James. When we issued the last AT1, I was actually saying, "This is a bit expensive." That was in January last year. And I will never ever doubt again what he is telling me to do on AT1 because it was exactly the right thing, at that point in time, to do it, so he is in full control.

We -- okay, we have 2 questions. Let's go at the back, first.

Alex Koagne from ODDO BHF. I was just wondering if there's any incentive today to keep DWS listed because obviously the fact that [ they distribute excess ] capital mean that there is no M&A in sight. And one of the reason why the company was listed was for M&A, so is there any incentive today for you to keep DWS listed?

Look. First of all, I think Stefan Hoops is somewhere in the room. And if we have to discuss something, then he and I do it first; and James, who is in the Supervisory Board of DWS and responsible in the Management Board for DWS. I think, by the way, there were more reasons to list DWS than just doing M&A. And by the way, I would -- as I said on the other question, if there is something which would make sense and irrespective of the size, again, I couldn't rule that out in full, but I think also, for other reasons, as DWS is completely different regulated, it is actually good to have a legal entity and the way we have structured it. Then you have an acquisition [ currency ] which is good, so I don't think that it was the one and the only reason. And for the time being, I wouldn't see any necessity to change here.

Yes, we had a question on the first row here.

Sorry. If I can follow up on your comments on the U.S. commercial real estate, if you could give us a little bit more outlook for asset quality in that book. Obviously still a lot of concern in that sector, especially in the regionals. There is concern that, as more transaction happens, some of these properties need to be revalued. You did take some provisions in last quarter, but just the outlook for next 12 months in terms of having to do more modifications or having to take more provisions in that book, it would be great if you'd give any color.

Yes. And I hope you don't take it the wrong way, but I can't say more than I just said. We believe that overall in the commercial real estate portfolio we will see, in '24, provisions in line with '23. And of course, '23 was elevated versus the normal years in commercial real estate, so there is no deterioration, but there is also not kind of signs of improvements here. Now it's always hard to talk about an asset class, so to say, across the sector because each and every bank -- and I was 20 years in risk management. You have different underwriting standards. You have different methodologies also when it comes to structure alone. We are very early in the process with our borrowers and in particular with the sponsors to think about early extensions. The way the team is engaged, starting, by the way, obviously in the first line of defense, not even in the second line of defense, but in the first line of defense, to think about early extensions, early restructurings: Actually, if you do it right, it can also take pressure off the portfolio. And therefore, I would say -- and this is my best assessment and, I think, also a conservative assessment -- '24. And that portfolio, for us, is like '23. And again, at the end of the day, I understand that there is a lot of discussion on that asset class, with a 500 billion loan book. 7 billion of that is in office buildings in the U.S. Sometimes I think the talk about that portfolio is a bit too much. Our pre provision of this bank is -- if you take the pre provision last year of this bank, i.e., pretax profits [indiscernible] provisions is around EUR 7 billion. Obviously we do everything in '24 to further increase it. Even if there is EUR 20 million, EUR 30 million or EUR 40 million more in loan loss provisions, it doesn't concern me. We have an eye on it. We have a fantastic risk management. We have a good first line of defense. We are in early discussions with the sponsors, so I feel okay with that.

Do we have further questions? Yes. It's coming here.

I have a generic question about the ECB which will unveil its operational framework tomorrow. I think this would not be neutral for banks. [ And then ] I'm curious to know your view about that and potentially if implementing permanent liquidity from a -- for banks is a game changer in terms of risk perception.

Look. I don't want to now judge on, so to say, not individual items which they will -- or sector-specific items which they will implement, but let me first say that I think the ECB has done, in my view, a really good job over the last 12 months. And you -- it's unusual that CEOs are praising the regulators, but a year ago -- I remember well. When I was sitting here a year ago, it was a week before the takeover of Credit Suisse by UBS happened. And you also know what happened with us on the 23rd or 24th of March. And of course, there were thoughts or concerns on our side that it could result in a -- and I don't mean that negative, but for us it is negative knee-jerk reaction for banks with regard to liquidity with regard to capital. I think the ECB really reacted very -- in a very mature way. And they have seen that, also given actually their decisions which they have taken over the last 10 years, they strengthened the banking sector. I think overall the European banking sector is not only mature but very robust not only from a balance sheet point of view, from a liquidity point of view but also from an earnings point of view, sustainable, profitable. And I'm really glad that this kind of conviction that we have a solid banking sector which can withstand issues like we have seen last year but in particular also issues which we have seen with regional banks in the U.S. and they -- that they took a very calm approach. Now why do I tell you that? I also think that the ECB is aware that the financial institutions and the banking sector, again in particular in the geopolitical situations where we are globally -- I'm always telling the politicians and the regulators: Banking is a strategic industry. We need our own European large banks in order to make sure that we have our banks, from a strategic, from a financing point of view, to go forward. And I think the ECB is and has realized that, and therefore, I'm not nervous about any decisions which will materially disadvantage now European banks. And I think it's also time to say that at some point in time.

Do we have other questions? Maybe if I can quickly follow up on the regulatory front, the results of a discussion in the U.S. instead about the Basel III end game. So how are you seeing that play out? In the short term, I don't know, do you see more opportunity for business? In the long term, what do you expect? And we only have 5 minutes. You can't speak no more than...

No, no, no. I'm not talking for 5 minutes, but this is a European financial conference, right?

Yes.

So there is not one of my U.S. colleagues coming tomorrow, right?

No.

All right. I'm just joking. Look. I think I don't know, at the end of the day, what's happening there. Obviously there is a lot of discussion, in particular after that what happened last year with the regional banks. At the end of the day, as much as I can interpretate that what we see in the U.S. with our operations but what I also hear from my colleagues, we will see an increase in capital requirements and in particular in certain businesses also in the U.S. Now the key question is what does it mean for us. We have a clear strategy in the U.S. You need to be -- if you want to be a globally active bank; and where you are advising corporate clients, private wealth management individual clients and institutional clients, you cannot be globally successful without being in the U.S., but there are pockets, in particular also in the markets business, where we do think, with the successful restructuring and turnaround and now with the development Ram has shown in particular in Europe, also in many parts of Asia, that we have a chance actually to grow revenues in the U.S. And there are plans that -- in the one or the other trading business where we feel we are close to our clients. We have the right products, and we have the right front-to-back processes that we can attack there. And that's what we want to do, but that decision is irrespective how the outcome of the Basel issue is in the U.S. I would expect a bit more higher capital requirements [ for ] them. How much I, cannot tell you. And you can also have trust in the lobby work of my colleagues in the U.S., I'm sure.

Right. Can I check if we have any final questions? Yes, in the front line here.

Just a quick question going back to [ CRE in ] Germany. Some of the specialized banks are challenged. What could be the [ contagion ]? Or what could be your role to help with solution? What could be the impact on the macro environment? How do you see what's going on?

Look. I'm not commenting and talking about other banks. I don't like that. And I was always happy, when we were having some challenging times, if others were not talking about us, but I do believe that last Thursday actually was quite a good day in terms of transparency in terms of news from the bank you are mentioning. And the best thing for us is that banks can show that they can handle potential challenging situations by themselves. And I have overall full trust. And you know who the CEO of that bank is. He used to be a former risk manager of Deutsche Bank, so he will do a good job.

Christian, thank you very much.

Thank you.