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Group Risk Report 234 178 Commerzbank Annual Report 2011 Intensive care Loan loss provisions Loan loss provisions in 2011 amounted to €1.4bn. The charge was therefore significantly reduced by €1.1bn compared with the previous year. This amount includes a one-off reversal of around €0.2bn which resulted from the revision and update of the parameters used to determine the portfolio loan loss provision for loans not in default. Loan loss provisions for 2011, even when adjusted for this one-off item, were more than one-third below the value of the previous year thanks to the trend reversal achieved in Asset Based Finance. The table illustrates the development at segment level: Loan loss provisions 2011 2010 €m Total Q4 Q3 Q2 Q1 Total Q4 Q3 Q2 Q1 Private Customers 57 – 53 34 35 41 246 46 64 70 66 Mittelstandsbank Central & Eastern 188 154 51 – 25 8 279 93 – 69 94 161 Europe 89 21 32 6 30 361 48 127 92 94 Corporates & Markets 146 56 59 31 0 – 27 – 14 6 0 – 19 Asset Based Finance Portfolio Restructuring 907 179 254 233 241 1,584 412 493 354 325 Unit Others and 5 26 – 17 – 3 – 1 62 10 2 28 22 Consolidation – 2 – 2 0 1 – 1 – 6 0 – 2 1 – 5 Total 1,390 381 413 278 318 2,499 595 621 639 644 Table 25 Provisions in Private Customers business were down by nearly €200m compared to the previous year. This decline is partly due to the parameter update in the fourth quarter of 2011, but operating provisions also exhibited a positive development and undershot the previous year’s figure by over €100m. As expected, provisions in the Mittelstandsbank segment increased significantly in the fourth quarter compared to previous quarters, due to new defaults. However, their level in 2011 remained approximately €90m below that in 2010, due to a good first half-year which saw releases of provisions.
To our Shareholders Corporate Responsibility Management Report Risk Report Group Financial Statements Further Information 235 179 157 213 Key developments in 2011 159 215 Risk-oriented overall bank management 163 219 Default risk 178 234 Intensive care 182 238 Market risk 187 243 Liquidity risk 190 246 Operational risk 192 248 Other risks 195 251 Outlook In 2011, provisions in Central & Eastern Europe were around €270m lower than the previous year. In particular, Bank Forum significantly reduced provisions by more than €130m compared to the previous year. The other units also reported a good risk performance in operational terms in 2011. BRE benefited additionally from one-off income from a portfolio sale in the second quarter, and from updates to parameters for retail business in the fourth quarter, which meant that the risk provisions were almost €100m lower than the previous year’s value. In Corporates & Markets loan loss provisions totalled €146m in 2011, while releases of provisions were recognised in the previous year. Loan loss provisions for the segment were driven by a few individual cases. Asset Based Finance saw the strongest decline in provisions compared with 2010 with a total of almost €700m. The bulk of this decline was in CRE Banking, in which operating provisions fell by over €600m. Loan loss provisions for the foreign portfolio in particular were down substantially compared with the previous year. In the fourth quarter, Asset Based Finance also recognised a one-off exceptional release due to the parameter update. In 2011, provisions of €5m were necessary in the Portfolio Restructuring Unit, which was over €50m less than in 2010. Similar to Corporates & Markets, developments in this segment were also largely affected by a few individual cases. In 2011, loan loss provisions for the Group, after adjusting for the one-off positive exceptional effect due to the revision and update of parameters, were generally well below the level of the previous year. This was largely due to the good performance of the first three quarters, although the slowing economy had its first, albeit slight, impact on provisions in the fourth quarter. This trend will continue in 2012, and, in the second half of 2012 in particular, we expect an increase in loan loss provisions for portfolios which are particularly sensitive to changes in the economy. However, at the moment an amount of €1.7bn in total seems to be realistic. The risks related to the macroeconomic framework are nevertheless still high. Depending on the macroeconomic development and in particular the impact of the ongoing sovereign debt crisis on the real economy, significantly higher provisioning may be necessary. Default portfolio The default portfolio was down significantly on the previous year by €2bn, and was €19.7bn at year-end. The portfolio includes receivables in the LaR category, but not impaired securities. The portfolio structure is shown in detail below: Group Risk Report
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Fourth Supplement dated April 13, 2
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Financial Statements and Management
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Corporate Responsibility One bank.
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Environment As a financial services
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In a joint initiative by the overal
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Performance-related remuneration Th
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The members of the Board of Managin
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The monthly amount of the retiremen
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tion for the remainder of his term
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Loans to members of the Board of Ma
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Other details D&O liability insuran
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Details pursuant to Art. 289 of the
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up to five years effective from the
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The Supervisory Board oversees fina
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• Statements on presentation in t
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Since summer 2011, the environment
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At the beginning of December, Comme
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The changes in the individual earni
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As with the change in other assets
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Report on events after the reportin
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We assume that Germany will fare be
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the resulting impact on financial i
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The Asset Based Finance segment was
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Risk report Risk reporting takes pl
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Risk strategy and risk management T
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Macroeconomic stress tests are also
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Overview of management instruments
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The “reduction” area comprises
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Corporates & Markets This segment c
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Public Finance Commerzbank’s Asse
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Portfolio by region as at 31.12.201
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and Europe (CLOs). The exposure in
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In 2011, provisions in Central & Ea
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of the overdraft starts on the firs
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The year 2011 was mainly affected b
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The adjoining diagram documents the
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Available net liquidity in the comb
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OpRisk events by segment | €m 201
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Reputational risk Reputational risk
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Provisions for pensions are calcula
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Notes to the income statement (5) B
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(12) Securities At December 31, 201
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(16) Fiduciary transactions Financi
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(23) Other liabilities Financial St
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(27) Equity Financial Statements an
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c) Retained earnings € Financial
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(30) Non-distributable amounts Fina
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Other notes (33) Off-balance-sheet
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(34) Forward transactions Financial
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(36) Remuneration and loans to boar
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€1,000 LTP Number of participatin
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Name Registered office Share of cap
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) Associated companies Name Registe
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Foreign-exchange rates for €1 as
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Members of the Supervisory Board of
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(41) Boards of Commerzbank Aktienge
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Independent Auditor’s Report 1 To
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Significant subsidiaries and associ
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Annual Report 2011 of the Commerzba
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To our Shareholders Corporate Respo
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Recent developments Optimisation of
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COMMERZBANK AKTIENGESELLSCHAFT Fran
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Jahresabschluss und Lagebericht 201
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