Welcome to Frankfurt. Welcome to Deutsche Bank’s fourth quarter and full year 2009 analyst conference. Many of you will be familiar with the format of today. First we will have a presentation and some remarks from Josef Ackermann, then Stefan Krause will follow. And then we will go first to questions from those of you, who are attending in the room. And then I am going to ask Maria, the dial-in hostess for questions from, there are a number of people who are dialing in and following this call via the webcast. Before we get started one very important request, please turn mobile phones and Blackberry's off. Not mute but off. You may not hear it but even if it is on mute it can interfere with the webcast. So thank you very much for your cooperation on that. Secondly if we don’t get to a question; if questions exceed the time that we have available please except my apologies in advance, come back to IR and we will get an answer for you as soon as we can and follow up with you. That's as far as I would like to go with opening remarks. I would now like to turn it over to the CEO Josef Ackermann to make some remarks about 2009. Joe.

Thank you, good morning and good afternoon where ever you are. Let me first say a few words about the financials of 2009 and then of course some words about the management agenda, just to keep you informed about what we said at the Investors Day, and then also talk a little bit about the regulatory changes how I see it. Everybody has probably a little bit different view. But coming back from Davos have some interesting and constructive discussions out here. First the 2009. I think before and I read some of your comments, and to be honest this is a year of sensation and I think that’s the most important part to understand. We have one-offs on both sides and actually the net result of one-offs is a charge of EUR 3.5 billion pre-tax. Now we can talk about the goodies or we can talk about the bad things. But important is that if these one-offs are behind us, we should be roughly EUR 3.5 billion better. That is a normalized level pre-tax and I think that is for me the key message I want give. So you have seen the income before income taxes and net income and the RoE. I think what is important that we have been able to further strengthen our capital and our 12.6% and Core Tier 1 at 8.7%. That’s why we think we have to do more to strengthen the capital this year by not raising dividends too much. To be honest this is also little bit what regulators are expecting from all of us. Actually our regulator are expecting two things, no bonus and no dividend. This was clearly… even more some politicians as was clearly communicated to all of us in Davos. I don’t want to provoke any negative…

Yes. Also good afternoon, good evening or good morning wherever you are, ladies and gentlemen. Obviously it is much nicer pleasure this year to show these results as we had the session last year. I am sure you can all feel with us. I am actually going to start with the same chart that Joe ended, basically summarizing that we achieved more was less; more profits, lower leverage and that resulted in extremely good capital ratios that I don’t think I need to repeat. If we go through the revenues, the revenues were EUR 28 billion for the year and EUR 5.5 billion for the quarter. In the first quarter we had specific items. We had monoline provisions of EUR 210 million with additional monoline reserves we decided to take. We had a property impairment of EUR 75 million on an impairment assessment. It is on our Cosmopolitan property and we had fair value losses on that, which also is a small number for Deutsche Bank of only EUR 29 million. For the full year 2009 the underlying revenues before mark-downs are very close to the 2007 record levels. In the full year, we had EUR 1.5 billion negative impact driven by about EUR 925 million of mark-downs. Remember this was the number that last year was over EUR 70 billion and we had this one total significant property impairment of EUR 575 million over the year. That composes the number we showed here on the slide. The decrease versus the third quarter was largely driven by a slow down that we have reported of sales and trading revenues which as you know affected all our major peers and which I will return in a moment. Provision for credit losses increased slightly to EUR 560 million in the fourth quarter.…

Thank you very much Stefan. Thank you very much Joe. I would like to turn it now to questions in the room. And please just two small requests, one is press the red button on your desk mic so that you can be heard over the webcast and the second is for those who are dialing in. Would people in the room please state your name and the name of your company before you ask your question. Thanks for your understanding.

Thank you very much. I am Dieter Hein from Fairesearch. I have three small questions. I was surprised regarding slow dividend. You are willing to pay or proposed and the topic was more the arguments that you fear some regulatory changes and you have to increase your capital ratios. The reason you gave here of that of the regulators, I am not pleased with bonus payments and dividend payments when you shall increase your capital, I can understand well. My first question is what I can't really understand why you decided for a satisfying bonus for your stuff and that not for a satisfying dividend for your shareholders and especially that what I think the regulatory will not love, you have decided to pay the UK payroll tax for your bankers here? Second question is regarding your Tier 1 figure. Your target UK tax is 10%. You are now well above. You need some capital for the acquisitions you have done. You told us in the past that you need more capital if you want to make a bigger acquisition. So is that now the higher capital for a bigger acquisition or you are really afraid for the regulatory requirements coming in the next years then I think you have to increase Tier 1 target if 10% is not enough? Or third alternative, it’s a lot of fantasy in the coming years for higher dividends and share buyback programs for your investors. So, what alternative is closest to your strategy there on the Tier 1 ratio? And last question is I missed an outlook for your net income in 2010. I did understand that you did not want to give one last year but I don’t understand it for THE current year. And therefore my concrete question is do you think you can exceed the EUR 5 billion net income from last year and the current year and maybe you can give an explanation why? Thank you.

Okay, a lot of questions all around the sector uncertainty. I don’t know more than or not much more than you to do. I am just saying we wanted to optimize between shareholders, people and regulators, and that is the best optimization we could find. Now you can go further in one or the other. Maybe we are two modest on the dividend side because capital will not be increased as much as you think capital requirements or you may have been through generate in the bonus tax in the UK. I am saying we are in a competitive environment. What we did is you can play around with the bonus tax first. I don’t think many banks agree that. Everything we hear and I mean a lot of bench marking and sell to a lot of people is they are all doing it the same way as we do. Of course you could have said you know obviously our link told me very clearly pay no bonus no tax. Well to be honest, I think it is not in interest of shareholders that our franchise is being destroyed in UK. What we are seeing that the impact, I don’t want to run the risk. So we felt we have to do something to keep the franchise intact and that is another optimization. We lower the bonus somewhat but not as much as to zero. So we do have to pay payroll tax in that. And in addition, we socialize. It cannot all go to the UK employees. Secondly, those who are saying we are lowering the UK alone and then you know going around and said forget it in a year from now they care a few, it is not the way you run our business. We are straightforward,…

Do you want to talk briefly about net income in 2010 and versus ‘09?

That was a good question. We have never given forward-looking statements on that. We said that we started January very well and let's see how we see a lot of good things happening in our industry and also see the risks. [Sudden] risk asset inflation the tariff rates, which won't be unwound, the default rates going up, many other things, so we are aware of that. Do we think that we have this specific problem to run item? No. But do we think that the cumulative effect of all of that could be challenging? The answer is absolutely yes, as for everyone else. But we have [theories] so much and learned the lesson that I think we are much better of now then we were three years ago. Philipp Zieschang – UBS: I have one follow-up question on capital and another one on your comp ratio. I mean as you already said I mean its pretty impossible to determine what the adequate capital level will be, but way you are at the moment how do you think about deploying or redeploying capital out of earnings that you gain now in January, February, March going to the second quarter do you achieve some scope for, do you feel comfortable enough to redeploy some capital into your business and also with the view to your seemingly comfortable leverage ratio now. And the second question is on comp ratio. How much scope do you see for in an environment where revenues for Deutsche Bank might be structured beyond the pressure to structurally decrease comp ratios, I know this is a question about you have to retain talent but you think that’s a chance also from corporate governance pressure increasing to structurally drive down comp ratios for your business.

I asked in Davos, we have a small session behind close to us and I asked the following question. If you meet the gain in three years from now, do you think which of the three scenarios you think as the most likely one? First one, we do nothing in terms of compensation I am not talking about the structure maybe I will complied that was a structure, I am talking about content. We do not think and in three years from now we are all back to normal and the economy is finally getting and everybody is happy to pay high bonus. Second one, we do something for actively to change it and the third one, we do nothing but there will be a regulatory political backlash. Indirectly via more capital, more taxation or directly in terms of influencing the compensation level. A majority of your fact grew from our peers felt that scenario three is the most likely one. I then said that if this is the case we better do something in scenario two. And we initiated now on behalf of the IAS, a working group which talks about that. Now this is easier said than done. But my view is the more we see capital, the more we see incremental taxation, the more likely and the more necessarily and also for the benefit of shareholders that we do something on the compensation level. So I cannot imagine that we pay the same compensation level going forward if the other things are changing so drastically as I expect them, and that is something we have to in sense of self regulation start working on it and there is I have to say broad support for that and now we are key bankers in the world.

On redeploying capital to our business we are and we will continue to deploy capital to our business but under the new paradigm discipline in not allowing balance sheets to grow up to much. We have supported acquisitions and I have the peaking work, we would have supported also an acquisition for the investment bank as well. So we are willing to grow our business I think the bank is back to growth mode but again but what we have learned that our odd business model is not the one that should reoccur, we do it with a tighter discipline and focus on return on these assets and focus on return on this capital deployed and we will have our business divisions competing for capital in terms of their returns.

Here, we have to make one point very clear because some may say this is a different story than we heard before because I always said no acquisition in investment banking which we don’t need. How about the seven [causes] alluding to a very specific I mean like the commodity we see in all the newspapers there is something very specific both on small acquisitions somewhere to compliment our activities investment but not an investment bank in anyway that we don’t need. Philipp Zieschang – UBS: Philipp Zieschang from UBS. And three questions please, the first one is when can we expect more news with respect to your $1 billion in infrastructure savings and what charges should we expect in order to realize this? The second one is coming back a bit on the comp ratio you have mentioned it's underlying its 37% this year and could you comment whether you think this is the new price and could you also share and your view about the comp and the non-comp ratios within your 65% target for next year? And thirdly, there is concern about the market with respect to the capitalization of your U.S. holding company. Obviously, you've activated additional deferred tax assets which could have driven the negative tier-one ratio up even further. Could you share in which way you are under pressure and probably bridge the gap between what you say is a solid capitalization of your operating entities versus the negative one on the holding? Thanks.

Okay, let me start first on the EUR 1 billion of efficiency gains that we want to show. We will be ready to announce that and we are willing to do a separate session on that. As you know, we have hired Mackenzie who has extensive experience in terms of these cost cutting exercises. They will use the same process and approach that they've used at other large tax companies, one of them I'm familiar with, obviously. And we've also hired a person that's going to be in the lead. I'm sure you read in the newspapers, he comes with a vast experience in these type of cost reductions. The team is already working on it. We have formulated already a substantial amount of measures. Once we're complete I commit to you that we will give you some more details on the program and on the achievement of the program. Just give us a little bit of time to finalize that. And our comp ratio 37%, is that the new base? We definitely believe yeah, that based on this structure, based on the changes and based on the structure of our new compensation system the answer is yes, that that's the direction I think comp is going. But also a [caveat] is we have to observe the competitive environment. We cannot put our franchise at risk and therefore, I think that's nothing we can commit to in an empty room type commitment. We have to see how the development is and see what happens to that. The US, that's our town subsidiary in the US correctly, it is in a situation that it would need under subsidization requirements to show capital. We have alerted all of you that at the end it's a reallocation of capital that we would have to do intra-group. It's not an additional capital we need on our group, to be very specific. Are there some, let's say, inefficiencies, because obviously currently we see our capital allocation to be optimal? Yes, of course there might be some inefficiencies, but I think we can manage them not to be significant or material as-far-as we see. Let's not forget that, despite the fact that tax revenue is very controlled and you need to show profits in the right geographic locations, you don't necessarily need to show assets in the right locations. So, there is some flexibility in managing that as well. We understand we will have some time to adjust and adopt. We have already started the brainwork on how we can deal with that in the United States if it were to be come true. It doesn't really change significantly anything in terms of our assets. Actually, what it does is it would hedge our capital a little bit better because we would have more U.S. dollar capital associated to our U.S. based assets which, in itself, obviously would then reduce some of the volatilities we have to report on some of the ratios to you.

With regards to compensation the most important question will be do people really understand that now increasing the fixed part means that this will be compensated by reducing the variable part. And we said that over-and-over in our internal messages, not that someone thinks, well, it's fine, I have 10%, 20% more now and I'm expecting the same bonus based on the same performance in a year from now. That is not the case. The total compensation based on same performance has to be the same. That's just the shift between fixed and variable.

And just the restructuring costs of the EUR 1 billion, could you just mention what we should plug in the model?

There was no point to give you. Sorry, I have to speak through the microphone that I will give you some more details on. We hired Mackenzie again, we are responsible for it and I think in a few weeks we will be able to describe exactly our path to the EUR 1 billion.

Please go ahead.

Dirk Becker from Kepler Capital Markets. And two questions, please. The first would be on the debt sales and trading. You said, Mr. Krause, in the November conference call that the margins in debt sales and trading are 10% to 60% above the pre-crisis levels and that you expected them to stay there. Nevertheless, I read a lot about lower margins and margin declines in your Q4 release, so can you update us on the situation there and whether you still believe that the margins will stay at the higher level? The second question would be on the intangibles relating to Scudder, which you are writing back. I was a bit surprised to see that, because Scudder never occurred to me as a very successful acquisition for you. And I think the numbers in 2009 don't really give me a lot of sense that Scudder turned around in 2009. So why did you write back the intangibles? Maybe you can explain what the numbers behind that is and how Scudder performed in 2009?

Okay, let me talk about the margin evolution, to just harmonize these two statements we have done. Throughout the year 2009, at the beginning we saw incredibly high margins, sometimes a 100% than they were before, sometimes even more than they were. Throughout the year 2009, these margins have come down and that's what we have reported. Nevertheless, they did stay above pre-crisis levels and, nevertheless, we believe that they will stay above pre-crisis levels. Why do we believe that? There is obviously much more consciousness about balance sheet, much more consciousness in the entire competitive environment, there is much more pressure on capital, there is much more pressure on correctly risk pricing, so therefore, and at the end you could say there is less competitiveness out there as well. So that's why we believe that, as they are coming down and as they have come down throughout the year 2009, the level at which they will come down and level to will be still better than in the pre-crisis years. On the Scudder intangible write-backs, all I can say it's accounting to some part of it. We have impaired this asset, in the year before by a larger amount than the amount we recovered in the year 2009. And I think this kind of volatility, obviously, is volatility you see related on the fact that we mark-to-market. And what has occurred here is you saw the value of these funds increase and, therefore, the value of these intangibles increase. As I told you, this business we've really looked at, we've restructured, we've adjusted the cost base. I must really say in Asset Management it was not done to improve the situation and, therefore, obviously our tests showed that we can write back to that.

Stefan Scharff, SRC Research. I have two questions. The first question is about the loan book. You shrunk the loan book about EUR 10 billion last year and there is still PBC mortgages of about 25% of it, and there is German SME business about 20% of it. Can you give us a little bit more detail about the development of your loan book as we have seen interest income come down 14% after loan loss provisions in 2009, if you want to build up the loan book again or it will be on this level also in 2010? And the second question is about Hugo Banziger. He is not here today, your Chief Risk Manager. I miss him because he was here the last years. Is there a special reason though? Okay.

To answer your last question, it was quite an interesting question to actually ask. We looked into the records of the bank and usually this is a meeting held by CEO and CFO traditionally. We wanted to come back to that tradition. And on specific topics we invited, then, our other partners from the board to be here and assist us here. Obviously, last year the big topic was risk and there was what we expecting lots of questions from you and, obviously, we didn't expect this to be the big issue any more after also our good results in the fourth quarter. I think we're looking forward, I think most of the risks are behind us and, therefore, we just thought that Hugo's time is better invested in continuing to monitor our risks in the Bank and actively working on it. The second question that you asked us on the loan book. Well, we have seen a slowdown on the loan book but it was not especially, I would say, not in our German lending, which we have increased since the beginning of the crisis and which has remained very stable throughout the year of 2009. So our loan book obviously has components in there that relate, for example, to our reclassified assets, that relate to other portfolios and those portfolios partially also, in these numbers we partially oversee portfolios that we have reduced in the effort to de-leverage the bank. We have shown you the decomposition of the loan book on that I think, by now famous, charts that shows you the different buckets. And what has happened is that, obviously, as we have de-risked the bank those loans we have been able either to restructure or to sell or reduce accordingly. So, actually nothing really exciting happening in the loan book. We will continue, as Joe said, to invest. We will continue to keep our loans up. Our loan activity in Germany continues to support (inaudible). We have additionally announced an additional measure to support the (inaudible) in Germany and, again, we can say we will take any good credit.

Okay, please go ahead.

Hi, Matt Clark, KBW. A couple of questions, please. Firstly, on the compensation in the fourth quarter, it looks like you've been deferring more than you would have previously under the old regime. What sort of benefit did that give to the fourth quarter compensation figure, and was it more than the burden of the UK tax provision? Second question, I think you mentioned commodities performed well. Could you just comment whether this is now, what the order of magnitude is? Is this now a $1 billion business for you in revenue terms? And then, thirdly, on the Cosmopolitan Resort, could you give us a carrying value for your investment and also tell us what that carrying value is compared to your cumulative investment, so an idea of the valuation of that holding? Thanks.

Okay, I'll start with your comp question. The question is whether we are deferring more. Yes, basically, as we thought the new structure of our compensation system we needed to bring it in compliance and the compliance assumes that we have to defer. Was it counterbalance? We're not disclosing obviously any details about our compensation numbers. I hope for your understanding, because this is sensitive competitive information. The Cosmo, let me talk about the Cosmo before I answer your commodities question. The project Cosmo is continuing to develop very well. The Cosmo project is on time, on budget as we speak. We actually in this project have benefited from the crisis because construction materials and construction costs, as you can assume, we could re-bid all our vendor contracts and had some substantial savings that helped us to avoid what usually happens in these multi-billion projects, that you have large cost overruns. So we're very confident that we will not have a cost overrun on this project as it's basically also completed to a large extent. In the impairment analysis, we did twice in the year 2009, at the beginning and at the end. Obviously, the weakening of the economy has had its impact in Las Vegas, interestingly enough, not in terms of hotel occupancy rates but in terms of average room prices, which led to the two times impairment we did; one at the beginning of the first quarter and the second at the end of Q4 for a minor amount. We therefore believe that this asset is now very well valued and fairly valued within our book and has a lot of upside potential. Let's not forget this is for a period of time will be the last new hotel casino resort for a while in Las Vegas. I'm sure you're all familiar with the dynamics in Las Vegas, that the last and newest ones is the one that always will have the most guests coming. Commodities revenues is one of the areas in the restructuring that in the change of our investment bank that we've been looking at. Our original targets, as we've always disclosed, were organic growth. As Joe said, eventually bolt on acquisitions in case the right opportunity shows up, but again, we stick to our plan based on organic growth. And the revenues were I would say so much above EUR 500 million and, therefore, in 2009 and we expect to grow that as we move on.

Can I just follow up? When you say above 500 million, is that dollars or Euros? And then, secondly, are you able to give a figure for the Cosmo carrying value, I mean ballpark? It doesn't need to be to the nearest million?

It's a EUR 1 billion project, they are carrying values above EUR 2 billion. And the numbers I disclosed were in Euros, as always.

Georg, I think you had a question.

Yeah, first of all, could you put into context this very well beginning with last year's very good start in sales and trading revenues? Is it, for example, in the plus, minus 10% range and should Jane, indicate it as its target for 2009? The second question is, when looking at new money in the Asset and Wealth Management business, I was quite surprised that mostly all of it came from the U.S. What is the reason for this, or are these only some larger names? And the third question I have is on the cost development in the Asset and Wealth Management division where there is a sharp increase from Q3 to Q4. Could you elaborate a little bit on this, the sharp increase after adjusting for these goodwill items?

Okay, we don't give percentage points in deviation, but it's above 2007 even; it's a record result.

Can you repeat your question, because we were consulting what to tell you on your first one?

So second was, on net new money, I was quite surprised that virtually all of your net new money in Q4 came from the U.S. Is this a special effect, is this one large name, or where does this come from?

The net new money development in Asset and Wealth Management, obviously, we have in the net new money development some market appreciation and, yes, we had some improvement in the United States, but I don't have now specific numbers for you to exactly tell you what it is, but we could get back to you if you like.

It's not only in devices. All these are diversified. And we all know that it's not a single name, by no means.

Thank you, Georg. At this point what I'd like to do is to invite for questions coming in from those who are dialing in via the dial-in facility. Maria, if you would like to go to the first question from those attending by phone, please.

Thank you, sir. The first question is from Derek De Vries from Bank of America Merrill Lynch. Please go ahead, sir.

Thank you. It's Derek from Bank of America. I have two questions. First, Mr. Ackermann kicked off by saying if you take the pre-tax profit there are about EUR 3.5 billion of negative exceptionals in there. I was hoping you could give us some more detail on that so we can understand how you did get to an underlying pre-tax of EUR 8.7 billion for the year. And, second, I was wondering if you can provide some details on the stable funding ratio proposed by Basel III, just ballpark, understanding it's a consultation paper and there's going to be a quantitative impact study and all those other caveats you like to throw back at us. Just ballpark, where are you on stable funding ratio? And if it's below the 100%, just any sense as to, as you start to manage to a stable funding ratio, if you think it has any impact on profitability or if you're kind of there or thereabouts? Those are my two questions, thanks.

Okay. Let me start with the first one. We have positive one-offs of about EUR 1.6 billion that impacted our profit favorably that we counted in this number. And then we had total negative impacts of about EUR 5 billion that are counted in this number. I think we've mentioned some of them. We talked just about the Cosmo impairment. We had, obviously, based on some legacy assets, some charge-offs, like you heard about Compass or Kalla topics. We talked about the fair-value gains, which are limited, though. We had a Huntsman settlement in the year. We have the UK payroll tax as non-recurring item. We have severance costs as non-recurring items. On the positive ones, obviously, we had the MTMs relating to Postbank, we had the Scudder intangible and obviously we had some in relation to our [REU] program some hedging gains. That gives you about the number of effects that's between the positive, which are one-offs that increased our profit by EUR 1.5 billion, EUR 1.6 billion, and then the negatives that are one-offs that we don't see reoccurring, the swing that is this EUR 3.5 billion net. That gives you on a good view on how the true underlying profitability over the year was and it also gives us the confidence towards our EUR 10 billion target for the businesses, that that can be achieved. Let's not forget that, rightfully so, you will say that we had higher margins in the investment bank and they will come down, on the one hand. But we still have depressed volumes across some of the areas of our investment bank. And on the other hand, let's not forget that all our stable businesses had to battle the storm in '09. So if we assume recovery there I think it's very plausible why we do believe in the EUR 10 billion number. And again, on the stable funding ratio, again, I can always say what you already took ahead, as the rules are in the proposal are preliminary and are not final yet and, therefore, any impact of this number is difficult for us to make. Let me also say that we strongly believe that we continue to have the best liquidity management and funding in place. And that was certainly one of the backbones and strengths to helping Deutsche Bank survive in the crisis, so we are not concerned. But I have to pass on we have not done calculations, as this is not final.

Maybe just one word. It goes without saying, but the EUR 3.5 billion are of course, non bonus corrected. Maybe there will be something else in addition.

Thank you, Derek. Can we have the next question, Maria, please?

The next question is from Huw van Steenis, Morgan Stanley. Please go ahead.

Good afternoon. Two questions. The first, I think the increase in dividend signals that you don't have any intention to accelerate the Deutsche Postbank deal, which some people have thought you might do. Could you just give your perspectives on when is the appropriate time for that and you obviously and you can take advantage of maybe the changes in the German market? And then, secondly, to Davos, Mr. Ackermann was talking about the economic impact of reforms. Which of the three or four current proposals would you think most damage economic reform and, therefore, are highly likely to be watered down in any consultation process? Thank you.

Well, to the first one, I think we said many, many times that we are in no hurry, that we keep the strategic optionality which we have and that it is in the interest of shareholders to wait and do the necessary streamlining, restructuring before we move, and nothing has changed in that. The same, to some extent, in the Sal Oppenheim case. I just would like to say, we have every interest. Now, if you do a somewhat linear calculation on what certain acquisitions mean for capital, you always should ask yourself what might be the management response. Would they keep everything in place? Would they reduce certain assets? Would they reduce loan books? Would they sell loan books or other businesses? So in that sense we want to work on that so that the impact for the shareholder is the best possible one. And I think that is in, hopefully, very politically correct terms what we are going to do. In terms of economic reform, well, the biggest problem would of course be absolute uncertainty about further initiatives. So if you have taxation, special regulatory changes in one country or another country, that could add up to a cumulative impact which is very negative. I think secondly, but that's more a hypothesis we are working on with other banks, including, I think, your bank. What does the trading book treatment mean for the securitization market? If you have more skill in the game and if you have more capital to allocate to securitization activities, does that impair this badly needed revival of the securitization market? And that will be, from an economic point of view, the biggest concern. Of course, the third one is a more obvious one, namely, the capital requirements which could put a lot of additional credit costs and would make it more difficult to finance the global economy. But the first two, in my view, are the most urgent ones.

Thank you, Huw. Maria, may we have the next question, please?

The next question is from Kian Abouhossein, JPMorgan. Please go ahead, sir.

Yes. The first one is on the option to pay for Sal Oppenheim in new shares. Now that I look at your tier-one ratio, which is well above your minimum, is there the option not to basically have any new shares issued? And the second question is, you, as Chairman of the IAF, what was really the three key points that came out of Davos? And where do we see a consensus building in terms of the way the banks want to go forwards? And what are the next trigger points where we see banks finding a way to respond to what the regulator is asking for?

Well, let me start with the second one. We will respond anyhow to the reforms because, otherwise, we're out of business. So, I don't think we have a lot of flexibility. No, no, I know what you mean. Well, I think, first of all, the spirit was very constructive, first thing, which was new. Before we had a lot of dialogue and debates via the media, and a lot of misunderstanding so, in that sense, I think everybody understands that things are still pretty fragile and that we should not overdo it. Secondly, there is a clear understanding that there are two issues, which I've just alluded to, securitization and, of course, the lending market, which have a particularly important element in it for the real economy. In terms of subsidization and the solution, living wills, I think people feel that we are still pretty far away from a response to that, even a solution to that. The key is absolute compensation. And two things are expected from us; that we come up with some self-regulation in compensation, and the second one is that we come up with some creative ideas on the liability side in terms of the resolution regime, including some contingent capital issues.

And can you just allude a little bit on the compensation side? Will it go further than what has been announced by FSA and some other regulators?

Well, so far nothing has been announced. The big misunderstanding is that people are talking about structural changes. But the cap trade driver is not interested whether you get 1m which is deferred or whether it is a potential claw back in the next three or four years in case your company makes a loss. What they want to hear is the quantum, and the quantum is absolutely open. There's full competition to some extent, rightly so. But the question is, are we provoking a regulatory or legal backlash. If you don't move on that front, then I would say most of the banks being present in, not all of them are actively involved but those who were actively involved felt that we should be aware of that regulatory or legal risk and we should start thinking about some sort of moderation or some sort of restraint. Now, how that will work, it's very difficult to say. The answer is let's have a cap. Now a cap is a bit too simple probably. Others are saying let's have a payout ratio. But, to be honest, if you have a bad year, in order to maintain your franchise you may have to pay more than the 37% comp ratio so, in that sense, that will probably be not an acceptable solution. So whoever has a more brilliant idea is highly welcome to speak up in the weeks to come. But we are now working on some sort of responses to that. And it is absolutely necessary to come up with some pro-actives because, otherwise, you run the risk of having a complete change of culture in our industry. And maybe it doesn't happen directly, as I said, but indirectly, by just asking for more capital, or asking for more taxes, but the burden would then lead to a lower profitability and, as a result, to lower compensation. And that is the key issue to everything to prevent that from happening.

Anything to sum up, Joe.

We have the built-in option and this is still being debated. There is no final decision taken, which path we take.

Ladies and gentlemen, with regret, I now have to ask for one last question and I'm afraid that's going to have to be the last one.

The last question is from Mr. Stuart Graham, Autonomous Research. Please go ahead, sir.

Hi. I had two quick questions. Firstly, back on Basel III, there's talk of increased risk weighted assets for the counterparty credit risk. Can you give us the figure for your counterparty credit risk [RWAs] and maybe some preliminary thoughts on how much that could increase by? And then, secondly, on sovereign risk, Mr. Ackermann mentioned that as one of the factors still out there. Can you tell us concretely what you're doing to reduce your sovereign risk exposure and maybe give us a feel for how much you've reduced that over the last few months? Thank you.

For the first question, the impact study has just started and I don't want to give you any indication here. But that is really not the big problem. The big problem is more in the short term now on the trading book and, there, the securitization is the key issue. And you have to differentiate between new business going forward, which, based on what you know, would not be a big problem, and then, of course, to legacy assets. So I think you will see a lot of reduction to legacy assets in 2010 in order to be free to grow your business in 2011. That is what is key right now. The sovereign risk, well, of course, we have started a long time ago to look into that. We are very comfortable with the exposures we have and I think we also have played a very positive role in not speculating against some of the sovereign risk.

I have one quick finance statement. I just got an update here from our staff to correct the carrying value on cost, what is. I was wrong. And our budget is around the figure that I told you and in terms of consolidated carry value right now is around EUR 1 billion.

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