COMMERZBANK AKTIENGESELLSCHAFT

the resulting impact on financial instrument valuations. Nevertheless, we are still expecting net
trading income in 2012 to be largely the same as in 2011. We anticipate that loan loss provisions
in lending business will be no higher than €1.7bn in 2012. We will continue to manage operating
expenses rigorously in 2012, and we will also press ahead with cost synergies. As a result,
we expect operating expenses to be no higher than €7.6bn.
In light of these developments, the core bank should post another year of solid operating
profit. As last year showed, profit in the ABF and PRU segments will depend on how the
European sovereign debt crisis evolves, which is a highly political arena. Our operating profit
target for the first half of 2012 is €1.2bn. If the markets stabilise, we expect the positive
earnings contribution to be lower in the second half of the year, which is weaker due to seasonal
factors. Based on our current estimates and provided the markets are stable, we anticipate
a net profit in Commerzbank Aktiengesellschaft’s parent company financial statements
in 2012.
Any payment of distributable profit for 2012 would be subject to the block on distributions
introduced in 2010 by the German Accounting Law Modernisation Act (BilMoG). This
stipulates that profits from non-operating business, such as contributions to earnings or equity
increases arising from the capitalisation of intangible assets, the mark-to-market of pension
assets and the capitalisation of deferred taxes – provided these are not covered by retained
earnings – are blocked from distribution. At year-end 2011, amounts subject to this
block totalled €3.0bn.
We anticipate the following developments in Commerzbank’s individual segments:
The market environment for the Private Customers segment should remaining challenging
in 2012, with net interest income dampened by low market interest rates and net commission
income by investor uncertainty. The loss of customer confidence will present financial
services providers with enormous challenges, and additional regulatory requirements
will intensify competition. We see an opportunity in these changed operating conditions to
expand our market position as a quality provider, which is why we already began remodelling
our Private Customer business strategy in 2011. Our new sales management will be a
major springboard for quality and growth. Our sales teams, having been given greater entrepreneurial
freedom, are closer to customers, which is the basis for a continuous improvement
in sales performance and for also sustained growth. Our “Customer focus” programme
will enable us to gear a wide range of services even more closely to customers’ needs, with
the aim of expanding our market position. We are therefore planning for higher income, particularly
from deposit and lending business, in the coming years. After completing the integration
in full, we expect to realise the major portion of the planned synergies by 2013. The
merger of closely located branches is outstanding and will be completed by the end of 2012.
We will continue to reduce our cost base through strict cost discipline and a critical analysis
of our processes within the scope of the “Commerzbank Excellence” project. All in all, we
are therefore expecting a further improvement in operating profit in the Private Customers
segment in 2012.
Financial Statements and Management Report 2011 43