Ladies and gentlemen, thank you for standing by. I'm Stuart, your Chorus Call operator. Welcome, and thank you for joining the Q4 2019 Analyst Call of Deutsche Bank. [Operator Instructions]I would now like to turn the conference over to James Rivett, Head of Investor Relations. Please go ahead.

Thank you, Stuart, and good afternoon or good morning, everyone, and thank you for joining us. As usual, on our call, our CEO, Christian Sewing, will speak first; followed by our Chief Financial Officer, James von Moltke. The presentation, as always, is available for download on the Investor Relations page of our db.com website. Before we get started, let me just remind you that the presentation contains forward-looking statements which may not develop as we currently expect. We therefore, ask you to take notice of the precautionary warning at the end of our materials.With that, let me hand over to Christian.

Thank you, James, and good afternoon, everyone, and welcome from me.In December at our Investor Deep Dive, we gave you an update on our strategy to radically transform our bank by 2022. Our performance in the fourth quarter shows two things: A, we have seen further good progress; and B, that our strategy is working. And we will continue to execute in a disciplined manner. We are in line with or ahead of all our key targets and objectives that were to be achieved in 2019.Since 2018, we have set realistic targets and delivered against them. We remain disciplined on costs. We delivered our eighth quarter in a row of year-on-year reductions in adjusted costs excluding transformation charges and bank levies.Our capital ratio increased in the quarter and is at the high end of our international peer group. And next to capital and costs where we have delivered now for a while, we are also encouraged by the stabilization that we are seeing in our core businesses. Clients support our focused strategy and are actively reengaging with us, a clear sign that our franchise is intact. And this bodes well for our performance in 2020 and beyond.Let me go through these themes in detail, starting with our performance against our 2019 objectives on Slide 2. Delivering on our near-term objectives sets us up to achieve our long-term goals. In 2019, we executed against all our financial objectives. We promised adjusted costs of €21.5 billion excluding transformation charges and the impact of the Global Prime Finance transfer to BNP Paribas, and we delivered.Our cost performance was in part driven by the reduction in employees where we ended the year at under 88,000 down more than 4,000 in the year and in line with our target. Since the end of the first…

Thank you, Christian.Let me start with a summary of our financial performance on Slide 10. Our results in both the quarter and the year were impacted by our actions to execute on our transformation, which I will detail shortly.In the fourth quarter, revenues adjusted for specific items shown on Slide 30 declined by 1%, reflecting the wind down of noncore businesses in the Capital Release Unit. Noninterest expenses of €6.4 billion included approximately €1.3 billion of restructuring and severance, litigation and transformation charges.Our net loss in the fourth quarter was a little under €1.5 billion including approximately €400 million of transformation-related deferred tax asset valuation adjustments. Tangible book value per share was €23.41, a 4% decline from the third quarter, mainly reflecting the net loss in the period.For the full year, we generated a pretax loss of €2.6 billion including €1.1 billion of transformation-related charges, €1 billion of goodwill impairment as well as €805 million in restructuring and severance and €473 million of litigation charges.Provision for credit losses was €723 million in line with our expectations; and at 17 basis points of loans, remained relatively low. Our net loss of €5.3 billion included €2.8 billion of transformation-related deferred tax asset valuation adjustments also in line with our expectations.To execute quickly on our strategic transformation, we took substantial costs in 2019, as you can see on Slide 11. Results in the fourth quarter included around €1.1 billion of pretax transformation effects. These items included €608 million of transformation-related charges included in our definition of adjusted costs.These charges principally relate to impairments and accelerated amortization of software intangibles and real estate charges. Results in the fourth quarter also included a further €400 million deferred tax asset valuation adjustment. For 2019 as a whole, we have taken around 70% of our total planned…

Stuart, let's now open the lines for questions.

[Operator Instructions] First question is from the line of Andy Stimpson of Bank of America. Please go ahead.

And first question on capital. A decent-sized beat on capital today, but James, I think you said on a media call that you're still thinking that would trough at about 12.7%. I'm just wondering what the moving parts are from here and whether there was a bit more seasonality in the risk-weighted assets this quarter that you'd expect to come back in the first quarter or why or if there's more inflation or why not think that you could be above that 12.7% trough level during 2020.And then secondly, please, on the Corporate Bank, revenues and costs were both a little weaker. I just wondered if you can talk around on revenues, the pressure on margins and how you think that will develop. I think you said you expected flat revenues in '20. I'm not sure if I heard that correctly, if you could just clarify that. And then be on costs, the greater tech spend, presumably on things like compliance and AML is a factor in there. And just how progressed those projects are and whether there's an investment phase that we should expect to reduce at some stage during '20 or maybe it's even after that, please. Thank you.

Sure, Andy. Thanks for the questions. I'll take both, but I'm sure Christian will want to add to the Corporate Bank discussion. So first of all, I mean, I guess what I'd say is at this point, we don't want to move that guidance up. But I'd say it's a conservative position that we're taking here. To give you a sense of the moving parts as you asked about, 13.6% is what we reported for December 31.We talk about the inflation so I mentioned the securitization framework. If you go back to the December presentation, the reg inflation in all of 2020, we would look at it as being about 60 basis points. So if you pro forma that, we have 13 basis points as a kind of foundational position. Everything else that happens this year, whether it's deleveraging in the Capital Release Unit, some degree of losses from restructurings, earnings in the Core Bank and investments in balance sheet growth in the Core Bank, all of that nets out against that 13%.How big a buffer we carry against the 12.5% minimum, we're going to have to see based on both the timing of all of these events as well as, frankly, the market opportunities for the businesses to grow balance sheet to support client activity. So with all of those things baked into the pie, as you may have heard me say on the media call, we think there's clearly a larger margin for error and potentially some ability to grow balance sheet beyond what had been originally foreseen in the plan.But I think I'd like to be conservative at this point in thinking about where we trough given all the moving parts and also the timing that I mentioned. So I hope that's helpful as to why we're…

Well, there is not a lot to add because I think you named it on the corporate side. Underlying, we are happy with the progress we are doing, Andy. I think on the IDD in December, Stefan Hoops was talking about the deposit charging, the growth in Asia, the increased payment fees, the growth in the TAS business, and all that, only to name a few, is supporting the underlying 4% growth.James was referring to the episodic items which we plan a little bit more conservative for 2020. But the underlying engagement, the client feedback and that what we can see in terms of mandate clearly supports that what we told you on the Investor Day.Also, these items which I just mentioned, deposit change- charging, growth in Asia, the increased payment fees, each of those is estimate to provide approximately € 100 million over the next three years. And hence, we will start seeing that in 2020, and it makes us comfortable that we achieve our goals. On the capital side, I have nothing to add. James all laid it out exactly to the point.

Andy, I'm reminded - sorry for the long answer, but you asked about the investment cycle in Corporate Bank, and I think this is also an important area to describe to you. Look, first of all, as you remember, there was a restatement exercise we went through last year. There have been changes in funds transfer pricing and internal cost allocation. So a lot of moving parts inside our segments. And in some ways, none more so than the Corporate Bank.We think we are at or very close to, if you like a finalization, a final basis for our external reporting of that segment, which now gives us a clear basis for future reporting and performance. In other words, comparisons would not be influenced by these items.That said, as you point out, there have been investments. So the technology, and particularly KYC cost increases, are real and pertain to that business. I would say we seek to continue investing in IT in that business. It's a critical element of our competitive position. And frankly, it's the largest beneficiary, if you like, of a reallocation of our tech budget away from equities as we wind down that business. And KYC remains critical. Although in that area, one would hope that in the not-too-distant future, we sort of crest the wave in terms of our investment and begin to deliver efficiencies based on the accumulative investment over the past several years.

Next question is from Daniele Brupbacher from UBS. Please go ahead.

First question is just on the rate headwinds. And on the media call, again, you mentioned those and you - I think you quantified them at around €230 million in the Private Bank. So I was wondering whether you could give us similar numbers for other units and how you - how you think about that going into 2020, what more is to come here.And probably in this context as well how you think about then how much of that can be compensated by volumes and margins. It feels like your working assumption seems to be that this should be largely compensated by volumes. But if you could just confirm that. And then you mentioned a few times the FTP model and that it impacts also the divisional - or I think you mentioned it in the context of the Corporate Bank.I know you described it in the past, but could you be a little bit more specific and give us some numbers around what that really means. Is there still a transition period. Do we have to take that into account when we model future revenues for the divisions?And just very lastly also on the media call, you stressed the importance of the U.S. market for Deutsche. I think that's well understood. Could you just give us some examples of submarkets where you feel you're gaining or regaining market share that would be very useful. Thank you.

Dan, potentially, I take the first one and the FTP is then done by James, and the last one we can do together. We simply gave the one number for the Private Bank because obviously this is most dependent and sensitive to the interest rate, in particular to the decision which we saw in September last year.And yes, we are planning to compensate that in full going forward also in that business. How? We said that in the Private Bank, but also in the Corporate Bank, we are consistently growing loans. By the way, we're not increasing our risk appetite. So within the risk framework we have, for instance, we drove an initiative in the German mortgage business last year in the Private Bank, which went very well.We are very active, as Manfred Knof said on the IDD in December, in swapping deposits into investment funds, and actually, we are making good progress on that. Also in January, that looks quite favorable what the Private Bank is doing. And as for the Corporate Bank, as I just lined out, there are other initiatives not only the active repricing where we have very constructive discussions with our clients and where we think we will see the first positive impact from the repricing in 2020, but also there, we have the underlying growth in the other business segments being the growth in Asia in Trade Finance and so on.So overall, while obviously, this interest rate environment is hurting, we have reacted appropriately and think we can compensate that. For the FTP, James, potentially you.

Sure. And so we've talked about this a little bit. The work that Dixit and the treasury team have been doing together with the business, to revamp our funds transfer pricing framework. What we're doing is essentially aligning it with the liquidity buffers, the unsecured spread, the capital charges that the businesses bring to the balance sheet, if you like, benefits and burdens of balance sheet usage in a way that aligns that charging more closely with clear drivers and frankly the regulatory environment that we operate in.So that's the principle behind it. We think it gives the businesses much better, more precise and also more controllable drivers and also funding cost numbers that they can then build into the third-party pricing. We will provide some disclosure of the impacts of these businesses as we get to the annual report so that you can trace it through. The number in Corporate Bank year-on-year is probably in and around €23 million. There are, frankly, other treasury effects as well that go in and out.So it's one of a number of factors. But to your point, we will - and we have at this point gotten on to a steady state of FTP. In the first and second quarters of next year, there will be - still be some small variances driven by it. Your market share question has to do with the United States in NIB. I'll leave that to Christian and maybe add some.

Yes, I think the first answer to that is what we have done globally, Daniele, also refers to the U.S. We believe that with the focus of the business on that where we are relevant and where we have a leading market position, we can also grow our business in the U.S. exactly that we have done there.But just give you some examples, like in the high-yield issuance but also in the investment-grade issuance, but in particular, in areas where we have been strong and will be strong like commercial real estate, we clearly have performed well in 2019, and we have seen increasing revenues.Again, with the risk appetite we have in place, with the risk management, we are confident that we can stay the course. You referred a little bit from James, that obviously we are starting from a better position from a capital point of view. That also allow us here and there of course in a selective way to also allocate a bit more capital to the one or the other business where we are strong, and we are making use of it.But I think the focus, which we have applied for the Investment Bank, but also Corporate Bank globally is also applying to the U.S. and there, we see the growth in there and those areas where we are leading.

Next question is from Andrew Lim from Société Générale. Please go ahead.

I just wanted a bit more clarity on that capital guidance that you gave. I think last year, you said that you would have a Q1 TRIM impact amounting to about 40 basis points. You didn't talk about it here. Are you saying then that this falls into 2020 and it's within that 60 basis points impact that brings you down to around 13%?And then just on the Corporate Bank, if you can clarify on that tax spend. So your overall costs have jumped up for the fourth quarter. I think you said that, that was going to be the run rate going forward? And that we should wait until the second half of this year before we can start to see that maybe come down a little bit. Perhaps if you could give a bit more color there. Thank you.

So let me jump in on the CET one guidance. Yes, the regulatory impacts, barring one smaller item, were recognized in 2019. So we go into 2020 really almost 100% in line with the guidance we gave you in December. Again, that small item - there's one small item that moved from Q4 to Q1. But by and large, you should focus on that €15 billion number that we gave you for reg inflation on the RWA line for 2020.

On the costs on the Corporate Bank, we have seen higher adjusted costs mainly from higher technology costs and control costs, also changes in the way we have charged the internal services to the businesses. Of course, with the efficiencies which we have in mind and in plan for the group, that over time will also positively affect the corporate group.So again, we are absolutely in line with our plan. The adjusted return on equity for the corporate group was around 7%. We gave you the target for '22, that is driven by growth, which we outlined, but also by taking certain efficiencies which are also beneficial to the Corporate Bank over time.

Next question is from Jernej Omahen from Goldman Sachs. Please go ahead.

I have two questions, please. The first one is on Page two when you lay out the achievements for this year, and I don't want to take away from these achievements because I agree with you, I think that they are substantial. But obviously, there's one category missing here which is the profitability or the profitability target.And I wanted to ask you the profitability question in the following way. For the full year and for the quarter, what was the underlying return on tangible equity for the bank as a whole? And I guess, by underlying, I would just also like to ask a sub-question as to what your preferred definition of that would be.And my second question would be on the performance of the Investment Bank. And again, I think it's healthy to see that the revenues are up year-on-year, and particularly in FIC that you're up 1/3 or 33% year-on-year in the quarter. But again, it was a very good quarter for FIC. Your - some of your global competitors - well, your global competitors on average are up 64% in FIC year-on-year would suggest that the market share loss continues. And I just wonder to what extent do you feel you have stemmed that market share attrition.And the final sub-question, I guess that's now number three, I said it's going to be 2, I'm sorry, but the final sub-question on the investment banking is revenues are up but returns, as I understand it or as you presented it, are down to 1%. How do you think about that as well?

Let me potentially start with my view on the Investment Bank, and then for the returns question, I hand over to James. First of all, Jernej, if you have been three years down revenue-wise year-over-year, it is very reassuring that also in the Investment Bank with the focus which we have decided in July, we see the turnaround. And to be very honest, we have seen that momentum and that turnaround now consistently since September, we did the necessary changes for certain business within the Investment Bank in July and August.And from September on, we see quite a good momentum. Now are we already there from a profitability point of view and also from a growth rate point of view where potentially all our peers are? No, because we always said that this is a long-term transformation. We need to focus, we need to adjust, we need to also invest into the simplification of our FIC business, which we are doing.And hence, I do believe that also, in particular from a profitability point of view and from a further growth point of view, that will be a gradual improvement. However, the most important is the client engagement, and the client engagement is clearly up. And that obviously, is supported by our CDS prices.But that is also supported simply by the focus and clarity we have now, what we serve in the Investment Bank, and what not. So last but not least, from a market share point of view, now let's wait, I think, for all the institutions coming out with the numbers for the fourth quarter including all Europeans.Secondly, I would also say in the FIC business let's not only do year-on-year but quarter-over-quarter. But - because in particular, I think in the FIC business quarter-over-quarter we are not looking too bad. And hence, I think we should take a little bit more time to justify or to judge on our market shares. James?

Sure. Jernej, on profitability, obviously, we're acutely aware of a sizable loss this year, net income loss. And hence, the focus that we put on the transformation effects to help you understand the - what the underlying performance looks like. Now of course, we want to limit the time we speak about underlying performance.But if you - to answer your question, I think the core bank numbers excluding transformation charges is probably the best number to look at. So that number, pretax is about €2.8 billion against €42.5 billion of allocated equity. If you tax effect it, it gives you an ROTCE somewhere in the 4% to 5% range. And it's that number we have to drive up as we talked about to 9% as being our goal in 2022.The way we've presented the transformation charges is intended - and also by the way, the BNP Paribas transaction, which includes leverage and expenses is intended to give you a sense of all the things that then fall away by 2022, making 2022 pretty much a clean year barring small restructuring expense and obviously the net loss, if you like, or the loss mostly from expenses that remains in CRU that we want to lift from that point.So I think that gives you probably the best answer and also why it is that we've done our presentation and restatement the way we have for the - all of which you can find in the FDS on Page 10 is the core bank representation.

Next question is from Adam Terelak from Mediobanca. Please go ahead.

First, I put a question on capital outlook, and then a follow-up on the Investment Bank balance sheet. On the capital outlook, can you just confirm that your year-end CRU balance sheet targets still hold for 2020? And then one of the moving pieces, I think we haven't got much color on is operational risk. You clearly come in ahead again this quarter. Could you give us some guidance on where that might go as it remains pretty material for the walk this year? And if it does come down further, does that change the €25 billion guidance you have for Basel IV in 2024, which I understand has a reduction of OpRisk embedded into it?And just a technical point, is there an AT1 accrual in CET1 capital at year-end? And then moving on to the Investment Bank. You flagged lower leverage ratio denominator from liquidity management. I want to understand how much funding benefit has come through into the fourth quarter print as a result and how much more you can do on liquidity. Because I've also noticed that the LCR is actually up Q-on-Q despite this. Is this something in the denominator we need to worry about that might rebound into the first quarter?

So lots of questions and questions that warm a former treasurer's heart. So Capital Release Unit, we are sticking to the targets that we laid out. We think we've given ourselves a helpful hand in terms of where we got to at the end of the last year. It gives us a little bit more flexibility in terms of timing and the manner of disposal of assets which is encouraging.On the OpRisk RWA, as you say, we have, I think, been very successful in bringing forward effects that we described to you in July as potential outcomes. And with the hard work, particularly of our risk colleagues, we were able to exceed our own expectations as to how much and how soon we were able to achieve methodology and model-related benefits in RWA. At this point, I would probably guide to flat from here.So we're not expecting additional significant moves there. But we do expect and have built into our forward capital planning some additional benefit, as you point out with the impact of BIV or overall Basel IV glide path. On the leverage ratio, we've been talking to you and also to our fixed income investors for some time on work we've been doing to improve the efficiency of our balance sheet.The leverage ratio did benefit, as you point out, seasonally from lower cash. We think that, by and large, is sustainable. And also seasonally from pending settlements, which, as you know, do go up again as activity increases. So the leverage ratio, I wouldn't expect to stick in the first quarter necessarily. Perhaps dip and then go back over the course of the year to our year-end target. I don't see anything frankly unusual in the LCR.We have been working to bring it down frankly as we drive efficiency in the balance sheet. But what you're seeing is significant declines in the outflow component of the LCR ratio, essentially offsetting declines in the HQLA and net inflows.So we've been seeing essentially efficiency offset the reduction in cash and liquidity reserves, which is good for the company and our earnings profile. In other words, improving earnings efficiency without sacrificing distressed liquidity value that we see on our balance sheet. The AT1 coupon is paid - is accrued when paid. So that's a 2020 event.

It's built into delta catch-up.

Exactly built into our - as you've seen in prior years, first and second quarters are burdened with some catch-up there. But that's all, of course, built into our capital planning.

Next question is from Kian Abouhossein from JPMorgan. Please go ahead.

Yes, Hi, thanks for taking my questions. Two more detailed ones and one just more general. First of all, the €100 million plus in tiering of deposits benefits and net number of 100 plus. Can you talk about how much you have achieved at this point and actually where you book it, in what division in the fourth quarter?And then secondly, the BNP transaction. You mentioned the associated benefit on the revenue side that you booked, and you talked about part of it being booked. I'm wondering how much more there is to come and in what quarter - and should we assume there's more to come in the 2020 year in the first quarter? And would you actually book that reimbursement?And then third one is just on Fixed Income. I mean, the environment from what I can see is very strong in credit. The breakdown you gave at the Investor Day illustrates you're very heavily credit be it now in fixed income. And clearly, you indicated the year has started well. But can you be a little bit more specific around your thoughts around your Fixed Income business considering your material gearing to the best part of performance year-to-date, how you're seeing the environment from your business perspective on the credit side?

Thanks, Kian. So tiering goes to the businesses, essentially through fed funds transfer pricing. So the benefits accrued to them in proportion to the liquidity reserves that they generate for the company. We began to see that benefit in November when it became effective. So essentially 2/3 of the run rate you would have seen in Q4.On the BNP Paribas side, that transaction, so we don't want to confuse you with this presentation, but we want to stay consistent with our original targets that we set for €21.5 billion for this year, €19.5 billion for next year. We haven't moved them to reflect the incremental expense relative to our original planning which had not foreseen that we keep the Prime Finance business operating as part of our expense base, but rather had we not pursued the transaction with BNP Paribas, it would have run down much more quickly.So what we're describing to you is the incremental expenses that we will book in essentially operating that business for BNP Paribas at the level that is reimbursable under the agreement. And that will be reflected in CRU revenues as a positive. Now we called out €102 million in the fourth quarter. That is the level of expenses that would have been reimbursable had the transaction closed on the 1st of October. In fact, it closed effective the first of December, so we received - we are eligible to have about 1/3 of that reimbursed for the fourth quarter.Going forward, it will be the full run rate through '19. Over time, a slightly declining reimbursable cost base frankly as we transfer over time small elements of the business to them, our personnel and infrastructure to BNP Paribas. But what we will essentially adjust out of our cost base is the reimbursement recapture that essentially nets out at the pretax profit line.

Kian, on your Fixed Income question. So overall, in Fixed Income, be it in Rates, in Currencies, Emerging Markets, we did changes last year as we said on the Investor Day, and it simply gains momentum. So it's not only a credit story. I also said that the improved CDS level and the perception around Deutsche Bank also in the debt capital markets, obviously, help us in our day-to-day Flow business.So I'm - we are satisfied with the momentum we see in the various products. Now on the credit side, this is our strength. Let me also talk a little bit more broadly from an economic point of view. I think we are even seeing a slight improvement in the economic environment globally.At least two uncertainties have been slightly taken away with the phase one of the trade agreement between the U.S. and China. We also have less uncertainty all around the Brexit, and we can see that in economic forecasts which are slightly up compared to our last earnings call end of October. We also see in our portfolio that there is no deterioration from an overall credit point of view. So yes, momentum, given our changes in that business is clearly picking up not only in credit but also in the others.And on the credit side, these are our - I think, one of our key strengths we have. And we are dealing in an economic environment which is still weaker than we have seen it in '17 or '18, but clearly a slight upgrade since October.

And Christian, if I may just add one more quick one. I mean, if I look at your performance this year, the restructuring clearly is on plan. You could make some arguments around revenues in the transaction bank, et cetera, but generally, you explained that very well. Where do you see from a bottom-up perspective leaving macro issues aside, the geopolitical issues, where do you see - what's keeping you up at night where you're most concerned about or where you believe, okay, this is an area where you really need to still turn around that particular issue?

Kian, to be honest, and it's a very simple answer, we have to apply day by day the same discipline on execution like we have done it for the last 20 months. If we do this, we have so granular plans. We are playing so much to the strength of Deutsche Bank in each and every business. If we keep that discipline, if we keep that execution focus, then I'm not worried.

Next question is from Jon Peace from Credit Suisse. Please go ahead.

Yes, thank you. I had a couple of questions to help understand the run rate in the C&O line, the corporate center. So firstly, the valuation and timing differences has been quite positive now for about six quarters and particularly this quarter. And should we expect this to reverse at some point? And if so, what would the triggers be for recognizing that? And the second question is on the funding line in C&O which was quite negative this quarter. How should we think about that as a trend? And should - will you be allocating more of that into the divisions?

Thanks, Jon. Great question. And it's rare that we get questions on the Corporate & Other slide on Page 24 in the deck. But it is a good question because Corporate & Other, some elements of it, frankly, are hard to run rate. If I were to just go quickly through the lines that you see here, funding and liquidity, as we've mentioned, has the €200 million drags from the FTP amortization that we have outlined.Other than that, it should clear to 0. There's obviously going to be, in every given quarter there's going to be a little bit of variance in the clear out from treasury. Valuation and timing, as you point out, is volatile. The principal drivers are essentially interest rate hedging of the balance sheet as well as FX hedging.And so it depends on both the level of rates, steep as the yield curve and also FX basis which are the main drivers of that. You had a 2018 that there was a fair amount that went adverse, particularly FX basis. In 2019, some of that FX basis reversed, and at the end of the year, we got some uplift from interest rates.But frankly, it's hard to predict, and we manage it as close to 0 as we can within the range of tools in hedging and also from an accounting perspective that we can. The shareholder expenses should be relatively stable. We've guided to around €400 million in shareholder expenses consistently.That's a - we operate to an OECD definition of expenses that are not - that are applicably not part of the businesses. And the only real variance you see there is when there's a significant restructuring and severance that applies to activities that are outside of the businesses. Litigation, of course, varies.And the noncontrolling - but it's litigation that is not specifically pertaining to events or matters that are inside the businesses. And then noncontrolling interests is really the reversal at this level of the DWS minorities that we report in the segment. There's lots of other things, as you can imagine, should kind of clear out relatively neutral. I hope that's helpful for your modeling.

Yes, thank you.

Next question is from Amit Goel from Barclays. Please go ahead.

I've got a kind of question on the FIC business and on the Investment Bank. Clearly, there are a few headlines in the press in the last few days about various kind of compensation related and timing discussions. When I look at how head count evolves over the course of the year, I see kind of last year, there was about a 5% drop into Q2. I'm just kind of curious how you're looking to manage that this year as we kind of go into Q2 and what we should expect. Are you expecting the same type of attrition as you had last year or perhaps a bit less or a bit more? And how are you trying to motivate and continue to drive the employees to get that top line to continue to tick over? Thank you.

Well, thank you. First of all, the attrition in 2019 was actually better than in 2018. We improved. And I think one reason why we improved and we said it on the investment - Investor Day is, yes, that we took some harsh and tough decisions, but that stands for nothing else than corporate clarity. People know in which direction we go. And actually, they appreciate and support that clarity and that clear way and pass ahead.When it comes to compensation this year, we obviously will not yet provide details. That is for a later time. But we are steering that we will see a reduction in overall variable comp. But the way we have done it we have clearly seen and looked at the operating performance and the adjusted performance James was outlining before. And we have done everything in order to appreciate and acknowledge the performance in particular of those colleagues and those businesses which from an operational point of view have reached their targets. In this regard, it is very much about differentiation.But let me also say, and I've worked here for 30 years, it's also very much about motivation and day-to-day leadership. And I do think that we have a management team, which has clearly adopted that. We have a very close communication and cooperation with our teams. And by differentiating and clearly looking for the operational performance and balancing the compensation around this one, I'm confident that we will not see a higher attrition in 2020 versus 2019.

Next question is from Anke Reingen from RBC. Please go ahead.

Yes, thank you very much for taking my question. Firstly, I wanted to come back on to the BNP transaction. Can you just please confirm that it's already out of your risk-weighted assets and leverage exposure? And as a result of the different impact on the costs, should we basically expect the cost base at €19.9 billion rather than the €19.5 billion but adjusted €19.5 billion, just to understand what number I should be looking for. And then the investment banking risk-weighted assets. I mean, obviously, that came down quite materially in Q4 outside of the operational risk-weighted assets. Do you think the Q4 level is just seasonally lower, and we should expect that to pick up again? Or is there any structural change outside the OpRisk-weighted assets that should keep the level lower?And just one follow-up question, please. On the - you made comments about your revenue assumption for most of the divisions. And for the private client division, is it fair to summarize you expect revenues to broadly stay flat or is the assumption actually you can do better? Thank you very much.

So on the BNP Paribas transaction, there is literally immaterial RWAs still on our balance sheet for that business, pursuant to a structural feature in the transaction that shifts that to BNP Paribas. We do carry leverage exposure on behalf of BNP Paribas; hence, we kind of removed that from our leverage ratio targets. Again, it will be gone by the end of 2021. But there is leverage exposure on our balance sheet relating to the - a portion of it relating to the Prime Finance business.On the expense side, you're absolutely right. All things equal, we would report €19.9 billion of expenses. But we want to stick to our target and not be in a position of moving targets. So the €19.5 billion is the number that would be, if you added back that revenue recapture. But you should be looking for the €19.9 billion in the financial statement disclosure. In terms of revenue assumptions in the business, I think we gave a reasonably complete outlook. I'm not sure I'd want to add to it. And Christian talked to the performance that he's expecting.Obviously, there's - the market conditions and the path of interest rates are important. You've heard us talk about the momentum that we saw in the - late last year, especially in investment banking and asset management. And you've talked us, heard about - you've heard us talk about the efforts that are underway in the Corporate Bank and Private Bank to offset the interest rate headwinds. We think the drivers of growth in those businesses are there. And over time, you'll start to see that underlying performance come through.

The next question is from the line of Andrew Coombs from Citi. Please go ahead.

Two questions, please, one on the transformation charges and then one just on deposit charging. Firstly, on the transformation charges on Slide 11 on software impairments, cumulative over 2019 to '22. I think your original guidance back in the middle of last year was €0.6 billion, they went to €1.2 billion in December and now stands at €1.5 billion. I'm just interested what's driving the incremental increase there. I just wanted to reaffirm that that does not impact on your capital position.My second question on deposit charging. Back at the Investor Day, you said €20 billion had already been implemented. There was €110 billion of additional deposits under review. Can you just update us on that situation, please, and whether the €100 million incremental revenues is still the right guidance and how much of that's already been booked in the 4Q run rate.

Sure, Andrew, thank you for the questions. Look, on the software IT, what has changed is the deeper and deeper we got into the - what we think of as the application estate within our technology under Bernd Leukert's leadership and his CIOs, the more we saw that we could take out of the company as we significantly simplify that estate. So we see this as a benefit to the company.So to the extent that this is the area where there's an expense miss on the total noninterest expense line, we see that as at worse neutral, frankly, positive both in simplifying the company and providing a benefit to future expenses. And you're absolutely right, that number walked up over time. And it was based on getting deeper and deeper into our software estate.I would say that the pricing of deposits, we are working on it. In that exhibit from the investor deep dive, we wanted to describe to you what the addressable balances might be. Obviously, it's a long way to go from 20 billion to 110 billion and that's a lot of client-related, client discussions. Many of our new pricing agreements are now effective essentially 1/1/2020, hence our view that you'll see an increasing amount. I think the guidance that we provided for both Corporate Bank and Private Bank back in December still applies in terms of what we expect to see from deposit charging. And as Stefan and also the Private Bank team I think, said at the time.We've been favorably surprised by the quality of the client dialogue in terms of turning that from a negative conversation about handing them a check to a positive conversation about how they can optimize their liquidity use. We also from just a deposit outflow perspective, I think, continue to feel we're outperforming our assumptions. And frankly, again, if you like, an upside surprise in this process is we've actually had improvements in the - what we think of as the liquidity quality of the deposit base that remains with us so early days, but frankly, good signs across the businesses of the impact there.

And can I just confirm the software IT impairment doesn't impact on capital?

Sorry. Yes, absolutely it does not - it's already disregarded from CET1 capital so no impact.

Next question is from Jeremy Sigee from Exane BNP Paribas. Please go ahead.

Just a couple of follow-ups, please. One was, if you can talk a bit more about the advisory revenues within the Investment Bank, which were quite a lot weaker in the quarter as you touched on. As they were for a number of people, we know that completions were lower. But other firms have talked about pipelines being a lot stronger coming into this year. And I wondered if you can sort of echo a similar sort of picture that gives you confidence for why that revenue stream remains intact and viable.So if you could talk about that a bit more, that would be great. And then the second question was really just continuing on the question around the €19.5 billion or €19.9 billion cost target. Are there any dependencies in hitting that number? Are there any events that you need to happen to do it, whether it's agreeing more headcount cuts or getting a step down in CRU costs or anything like that?

So let me take the first question. You're right we have seen kind of softness in the fourth quarter. It has nothing to do that this is something structural. If we look at our pipeline, if I look at the market response and also the mandates which we get, then I do think that we have a very stable franchise here and where I'm not nervous that the kind of partial softness we have seen in the fourth quarter is a directional guidance for 2020.We also have very strong performances in the origination advisory business. In particular, we have been very happy with the performance of our debt origination, both in the investment grade as well as in the high yield. And we cannot see that this is stopping. And hence this is, in our view, a core business to Deutsche Bank which we obviously will pursue. And we are confident that we will show satisfactory results and revenues going forward.

On the €19.5 billion cost target, I would just say many, many things need to continue to happen across the organization as we continue on our cost discipline and this sort of run rate decline that we have exhibited for the past eight quarters. I will say with the appointment of Fabrizio Campelli as Chief Transformation Officer, we get a new partner at the management board table along with all of the business leadership and Frank Kuhnke focusing on a variety of issues, but importantly, cost management.In many respects, it is a role to - that includes helping on the implementation of cost measures. And we've identified many, many cost measures across the organization, which we will then partner closely that is financed with the transformation organization under Fabrizio to execute on.

And the last question comes from Stuart Graham from Autonomous Research LLP. Please go ahead.

I had two please. First, on FIC Christian, you talked of having stabilized the franchise and yet I see ongoing market share losses. But from your answer to Jernej's question, maybe I shouldn't be worried about FIC market share losses at this stage. So I guess my question is how you're defining that stabilization, please.And then the second question is, you talked back in July about the benefits from lower funding costs. I think the figure out to 2022 is something like €500 million or so. How much of that's already been achieved at the Q4 stage and what do you expect for 2020, please? Thank you.

Thanks, Stuart. Well I said the - to the question from Jernej that obviously, the U.S. competitors have shown very strong FIC numbers in the fourth quarter, there is no doubt. But I said that if we compare quarter-over-quarter, fourth quarter versus the third quarter, I think we can compare ourselves well with our competitors, number one. Number two, I really think that we should wait for kind of all financial institutions coming in, now also our European peers to finally validate where we stand from a market share.Number three, my positive comments on the fixed income is that it's not only on the credit business but that across our offerings we see a momentum. And the nice thing Stuart, about this one is on the back of client flow. Clients are reengaging, clients reach out to us. The handover between Corporate Bank and Investment Bank is working very well in all kind of segments, be it the rates business or the FX business.And hence, we think it's a solid foundation with the first time a year-over-year growth. And hence, we feel positive about the momentum and the underlying growth we see. And again, let's wait for all the peers coming in and then we can see finally on the market shares.

How do you know if that's your value-add or just the market environment? I get it that both of them are good, but obviously, one is better than the other?

Well, I can also see it with the number of clients coming in, they’re reengaging with us. That is always a good signal that we had through the years clients who did not engage with us, who are clearly coming back, and that is not only the favorable market which I agree. We had more favorable markets in the fourth quarter 2019 than in 2018, no doubt at all. I also said that in the media conference. But with clients coming back and being very active with us, that is for me one of the major positive signals.

Stuart, on the funding costs, one thing I'd point you to, is the net interest margin disclosure that we now provide in the financial data supplement. I can't give you a euro number of how much of the €500 million has come through at this point off the top of my head. But there are elements of the things we've been talking about for a while that are entering into the margin and helping support the margin.You'll see that the history is of an increasing margin. That's obviously difficult to sustain in the interest rate environment that we're in. But I think the various items, whether it was putting together an investment portfolio in treasury, significant deleveraging in the form of pay down of long-term debt that has already flown in, at least in part, it's sort of bled in, if you like, to the P&L over time.Some of the other things that we've talked about like taking advantage of greater hedging tools to manage our interest rate risk and also sort of balance sheet productivity, that's really only just getting started. So I would see over time in a very slow build to that number in 2022, hopefully, helps us sustain a margin relative to what are otherwise typically pressures on the margin in addition to loan growth and some of the other structural improvements on the balance sheet.

There are no further questions at this time. And I would like to hand back to James Rivett for any closing comments. Please go ahead.

Thank you very much for your time. We can see there are some more questions. The IR team will reach out to you in due course.

Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephones. Thank you for joining, and have a pleasant day. Goodbye.