Deutsche Bank AG — 2022 Form 20-F
Reporting period: Fiscal year ended December 31, 2022; filed March 17, 2023. The consolidated financial statements are audited and prepared under IFRS as issued by the IASB. Deutsche Bank operates through Corporate Bank, Investment Bank, Private Bank and Asset Management, alongside Corporate & Other and, through 2022, the Capital Release Unit.
Financial performance and position
| Metric | 2022 | 2021 |
|---|---|---|
| Net interest income | €14.0bn (+26%) | €11.1bn |
| Net revenues before provision for credit losses | €27.1bn (+6%) | €25.5bn |
| Provision for credit losses | €1.226bn; 25 bps of average loans | €515m; 12 bps |
| Noninterest expenses | €20.4bn (-5%) | €21.5bn |
| Cost/income ratio | 75% | 84% |
| Profit before tax | €5.447bn (+55%) | €3.518bn |
| Net profit | €5.554bn (+114%) | €2.595bn |
| Profit attributable to Deutsche Bank shareholders | €4.919bn (+143%) | €2.025bn |
| Operating cash flow | (€2.1bn) | (€3.0bn) |
| Total assets | €1.344tn | €1.325tn |
| Total equity | €72.1bn | €68.1bn |
Net profit benefited from a €1.4bn deferred-tax-asset valuation adjustment, reflecting continued strong U.S. performance; the comparable 2021 benefit was €274m. The 2022 effective tax rate was negative 2%. Net revenues rose on higher interest rates and strong Corporate Bank and Investment Bank Fixed Income & Currencies activity; commissions and fees fell 10%, primarily due to weaker origination and advisory revenues and lower asset-management performance fees.
At year-end, CET1 capital was €48.1bn and the CET1 ratio 13.4%, versus 13.2% in 2021. The leverage ratio was 4.6%, versus 4.9%. High-quality liquid assets were €219bn, total liquidity reserves €256bn, the liquidity coverage ratio 142% and the net stable funding ratio 120%. Capitalization disclosures report total debt of €137.3bn, including €131.5bn long-term debt, €5.25bn long-term debt at fair value through profit or loss and €0.5bn trust preferred securities.
Consolidated cash and cash equivalents were €165.6bn at year-end. Cash flows were affected by banking balance-sheet movements; operating cash flow was negative €2.1bn and investing cash flow negative €17.2bn. These cash-flow figures should be interpreted alongside the bank’s liquidity and funding disclosures.
Material changes versus 2021
- Profit before tax increased 55%, with higher revenues and lower expenses more than offsetting increased credit-loss provisions.
- Net interest income rose 26% as interest rates increased; the Group’s net interest margin rose to 1.42% from 1.18%.
- Credit-loss provisions more than doubled, reflecting a weaker macroeconomic environment and increased Stage 3 losses.
- Noninterest expenses fell 5%, mainly as transformation charges declined; bank levies rose €210m to €762m.
- The Capital Release Unit reduced its 2022 pre-tax loss to €932m and met its de-risking mandate. It will cease to be a separate reported segment from Q1 2023; remaining activities move to Corporate & Other.
Outlook, management commentary and risks
Management expects 2023 credit-loss provisions at the low end of 25–30 basis points of average loans, driven more by single-name losses than by further deterioration in macroeconomic indicators. The filing describes high uncertainty around inflation, rising interest rates, the war in Ukraine, energy prices, geopolitical tensions and possible recession. These conditions could weaken client credit quality, increase funding costs and reduce market activity.
The 2025 targets are post-tax return on average tangible equity above 10%, annual revenue growth of 3.5–4.5%, a cost/income ratio below 62.5%, a CET1 ratio around 13% and a 50% total payout ratio from 2025. Management expects more than €2bn of structural cost savings between 2022 and 2025. These are targets, not guarantees, and depend on economic, market, regulatory and execution conditions.
The Management Board proposed a €0.30-per-share dividend for 2022, subject to approval at the Annual General Meeting. The bank completed a €394.6m share repurchase program in 2022. Future distributions and buybacks are subject to profitability, capital requirements, regulatory approval and German corporate law.
Material risks include ongoing litigation and investigations, particularly the Postbank takeover claims (almost €700m claimed, excluding interest), cum-ex tax matters and a disputed FX-derivatives claim by Palladium Hotels Group estimated by claimants at €500m. BaFin has ordered AML and know-your-client remediation and appointed a special representative to monitor implementation. The bank also identifies control, technology, cyber, operational, model, climate and third-party risks. Management and the auditor concluded that internal control over financial reporting was effective as of year-end; the auditor issued an unqualified opinion.
The filing states that the direct financial exposures to Russia and Ukraine were contained and reduced during 2022, but warns that sanctions, operational constraints and indirect economic effects remain uncertain. Russia loan exposure was €806m gross and €379m net of specified risk mitigants at year-end; Ukraine net loan exposure was €64m.
Investor verification priorities
- Check the 2022 consolidated statements and segment disclosures, especially the distinction between €27.1bn net revenues before provisions and €25.8bn after provisions.
- Assess how much of the €5.554bn net profit depends on the €1.4bn deferred-tax adjustment and whether that benefit is repeatable.
- Track credit quality, provision levels and exposures to vulnerable borrowers as the 2023 outlook evolves.
- Review the status, provisions and possible outcomes of Postbank, cum-ex, AML and other legal or regulatory matters.
- Monitor delivery of the 2025 profitability, cost, capital and shareholder-payout targets, including the planned savings and regulatory constraints.