SEC Form 20-F - Deutsche Bank Annual Report 2012

Deutsche Bank Supplemental Financial Information (Unaudited) S-10
Annual Report 2010 on Form 20-F
Allowance for Loan Losses
The following table presents a breakdown of the movements in the Group’s allowance for loan losses for the
periods specified.
in € m.
(unless stated otherwise) 2010 2009 2008 2007 2006
Balance, beginning of year 3,343 1,938 1,705 1,670 1,832
Charge-offs:
German:
Banks and insurance (5) (2) (2) (1) (2)
Manufacturing (43) (43) (53) (58) (78)
Wholesale and retail trade (32) (23) (41) (28) (40)
Households (excluding mortgages) (338) (340) (330) (287) (244)
Households – mortgages (26) (23) (32) (26) (35)
Commercial real estate activities (22) (6) (19) (41) (96)
Public sector – – – – –
Other (49) (72) (127) (76) (102)
German total (515) (509) (604) (518) (596)
Non-German total (928) (713) (386) (234) (136)
Total charge-offs (1,443) (1,222) (990) (752) (732)
Recoveries:
German:
Banks and insurance 1 1 1 1 1
Manufacturing 14 11 14 21 19
Wholesale and retail trade 6 7 8 10 9
Households (excluding mortgages) 63 83 81 63 46
Households – mortgages 4 1 3 – 8
Commercial real estate activities 4 7 9 9 16
Public sector – – – – –
Other 20 25 41 49 56
German total 112 135 157 153 155
Non-German total 31 31 55 72 133
Total recoveries 143 166 212 225 288
Net charge-offs (1,300) (1,056) (778) (527) (444)
Provision for loan losses 1,313 2,597 1,084 651 352
Other changes (e.g. exchange rate changes,
changes in the group of consolidated companies) (60) (137) (74) (88) (70)
Balance, end of year 3,296 3,343 1,938 1,705 1,670
Percentage of total net charge-offs to average
loans for the year 0.45 % 0.39 % 0.33 % 0.28 % 0.25 %
The Group’s allowance for loan losses as of December 31, 2010 was € 3.3 billion, a 1 % decrease from prior year
end. The decrease in the Group’s allowance was principally due to charge-offs, reductions resulting from currency
translation and unwinding effects exceeding the Group’s provisions.
The Group’s net charge-offs amounted to € 1.3 billion in 2010. Of the charge-offs for 2010, € 896 million were
related to the Group’s corporate credit exposure, of which € 607 million were related to assets which had been
reclassified in accordance with IAS 39 in the Group’s United Kingdom and Asia-Pacific portfolios, and
€ 404 million to the Group’s consumer credit exposure, mainly driven by the Group’s German portfolios.
The Group’s provision for loan losses in 2010 was € 1.3 billion, principally driven by € 562 million for the
Group’s corporate credit exposures, of which € 278 million of new provisions were established relating to
assets which had been reclassified in accordance with IAS 39, relating predominantly to exposures in
Corporate Banking & Securities. The remaining increase reflected impairment charges taken on a number of
exposures in the Americas and in Europe in an overall favorable global economic credit environment. Loan