entire - Deutsche Bank Annual Report 2012

Deutsche Bank 01 – Management Report 114
Financial Report 2010 Risk Report
The allocation of capital, determination of our funding plan and other resource issues are framed by the Capital
and Risk Committee.
Regional capital plans covering the capital needs of our branches and subsidiaries are prepared on a semiannual
basis and presented to the Group Investment Committee. Most of our subsidiaries are subject to legal
and regulatory capital requirements. Local Asset and Liability Committees attend to those needs under the
stewardship of regional Treasury teams. Furthermore, they safeguard compliance with requirements such as
restrictions on dividends allowable for remittance to Deutsche Bank AG or on the ability of our subsidiaries to
make loans or advances to the parent bank. In developing, implementing and testing our capital and liquidity,
we take such legal and regulatory requirements into account.
On October 6, 2010, we completed a capital increase from authorized capital against cash contributions. In
total, 308.6 million new registered no-par value shares (common shares) were issued, resulting in gross
proceeds of € 10.2 billion. The net proceeds of € 10.1 billion raised in the issuance (after expenses of approximately
€ 0.1 billion, net of tax) were primarily used to cover the capital consumption from the consolidation of
Postbank, and, in addition, to support the existing capital base.
Treasury executes the repurchase of shares. As of January 1, 2010, the number of shares held in Treasury
from buybacks totaled 0.6 million. The 2009 Annual General Meeting granted our management board the
authority to buy back up to 62.1 million shares before the end of October 2010. During the period from January 1,
2010 until the 2010 Annual General Meeting, 11.1 million shares (or 2 % of shares issued) were purchased.
Thereof 10.6 million were used for equity compensation purposes. As of the 2010 Annual General Meeting on
May 27, 2010, the number of shares held in Treasury from buybacks totaled 1.0 million. The 2010 Annual
General Meeting granted our management board the authority to buy back up to 62.1 million shares before the
end of November 2014. Thereof 31.0 million shares can be purchased by using derivatives. During the period
from the 2010 Annual General Meeting until December 31, 2010, 18.8 million shares were purchased, of which
0.5 million were purchased via sold put options which were executed by the counterparty at maturity date.
9.8 million of the total 18.8 million shares repurchased were used for equity compensation purposes in 2010
and 9.0 million shares were used to increase our Treasury position for later use for future equity compensation.
As of December 31, 2010, the number of shares held in Treasury from buybacks totaled 10.0 million.
Total outstanding hybrid Tier 1 capital (substantially all noncumulative trust preferred securities) as of December
31, 2010, amounted to € 12.6 billion compared to € 10.6 billion as of December 31, 2009. This increase
was mainly due to the consolidation of € 1.6 billion hybrid Tier 1 capital issued by Postbank and foreign exchange
effects of the strengthened U.S. dollar on our U.S. dollar denominated hybrid Tier 1 capital. During the
first half year 2010 we raised € 0.1 billion of hybrid Tier 1 capital by increasing an outstanding issue.
In 2010, we issued € 1.2 billion of lower Tier 2 capital (qualified subordinated liabilities). Consolidation of Tier 2
capital issued by Postbank added € 2.2 billion of lower Tier 2 capital and € 1.2 billion of profit participation
rights. Profit participation rights amounted to € 1.2 billion after and nil before consolidation of Postbank. Qualified
subordinated liabilities as of December 31, 2010 amounted to € 10.7 billion compared to € 7.1 billion as of
December 31, 2009. Cumulative preferred securities amounted to € 0.3 billion as of December 31, 2010, unchanged
to December 31, 2009.