Deutsche Bank AG (XETRA: DBKGn.DE / NYSE: DB) has been informed by the European Central Bank (ECB) of its decision regarding prudential capital requirements to be maintained from 1 March 2022 onwards, following the 2021 Supervisory Review and Evaluation Process (SREP). The ECB’s decision requires Deutsche Bank, on a consolidated basis, to maintain an unchanged Pillar 2 requirement (P2R) of 2.50% of which at least 1.41% must be covered by Common Equity Tier 1 (CET 1) capital, and 1.875% by Tier 1 capital.
The ECB’s decision requires Deutsche Bank, on a consolidated basis, to maintain a Common Equity Tier 1 (CET 1) capital ratio of at least 10.43%. This CET 1 capital requirement comprises: the minimum Pillar 1 requirement of 4.50%; the Pillar 2 requirement of 1.41%; the capital conservation buffer of 2.50%; the countercyclical buffer of 0.03% as at year end 2021; and the requirement arising from the maximum of the buffers from Deutsche Bank’s designation as a Global Systemically Important Institution (G-SII) or as an Other Systemically Important Institution (O-SII) of 2.00%.
This requirement sets the level below which Deutsche Bank would be required to calculate a Maximum Distributable Amount (MDA). The MDA is used to determine restrictions on distributions in the form of dividends on CET 1 capital, new variable remuneration and coupon payments to holders of Additional Tier 1 instruments.
The ECB has also set new minimum requirements for other capital definitions. Corresponding 2022 requirements are set for Deutsche Bank’s Tier 1 capital ratio (12.40%) and Total capital ratio (15.03%). In comparison, Deutsche Bank’s last reported consolidated capital ratios on a phase-in basis were 13.23% CET 1 capital ratio, 15.75% Tier 1 capital ratio and 17.84% Total capital ratio, all preliminary as of 31 December 2021.
About Deutsche Bank
Deutsche Bank provides retail and private banking, corporate and transaction banking, lending, asset and wealth management products and services as well as focused investment banking to private individuals, small and medium-sized companies, corporations, governments and institutional investors. Deutsche Bank is the leading bank in Germany with strong European roots and a global network.
This release contains forward-looking statements. Forward-looking statements are statements that are not historical facts; they include statements about our beliefs and expectations and the assumptions underlying them. These statements are based on plans, estimates and projections as they are currently available to the management of Deutsche Bank. Forward-looking statements therefore speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.
By their very nature, forward-looking statements involve risks and uncertainties. A number of important factors could therefore cause actual results to differ materially from those contained in any forward-looking statement.
Such factors include the conditions in the financial markets in Germany, in Europe, in the United States and elsewhere from which we derive a substantial portion of our revenues and in which we hold a substantial portion of our assets, the development of asset prices and market volatility, potential defaults of borrowers or trading counterparties, the implementation of our strategic initiatives, the reliability of our risk management policies, procedures and methods, and other risks referenced in our filings with the U.S. Securities and Exchange Commission.
Such factors are described in detail in our SEC Form 20-F of 12 March 2021 under the heading “Risk Factors”. Copies of this document are readily available upon request or can be downloaded from www.db.com/ir.