COMMERZBANK AKTIENGESELLSCHAFT

In 2011, provisions in Central & Eastern Europe were around €270m lower than the previ-
ous 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:
Financial Statements and Management Report 2011 65