Report
Expert Corporate Governance Service (ECGS)
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Deutsche Bank - AGM 23 May 2019

General: On 17 March 2019, Deutsche Bank and Commerzbank published that they had agreed to start discussions with an open outcome on a potential merger. However, on 25 April 2019, the Management Boards of both Deutsche Bank and Commerzbank announced that a combination would not have created sufficient benefits to offset the additional execution risks, restructuring costs and capital requirements associated with such a large-scale integration. As a result, the two banks decided to discontinue discussions.

Item 2: Management and Supervisory Board are proposing to distribute an unchanged dividend of EUR 0.11 per share (EPS: EUR -0.01). ECGS believes that dividends should be covered by consolidated earnings and/or free cash flow and supported by a strong balance sheet in terms of solvency and leverage. As the dividend is not covered by earnings for the third consecutive year we consider a dividend payment inappropriate at this time and recommend opposing the dividend proposal.

Item 3: We recommend to oppose the discharge of the Management Board due to concerns over the functioning and compliance of the Company's risk management system.

Item 4: We recommend to oppose the discharge of the Supervisory Board for concerns over the Board's oversight over the Company, including its strategic orientation and personnel planning.

Item 5a: KPMG has audited the Company since the financial year 1952 which significantly exceeds our maximum acceptable term of office as we consider a longer term of office may impair the auditor's independence. We welcome however that the Company has announced to change the audit firm as of financial year 2020, see item 5b of the agenda, and therefore exceptionally recommend to support the reappointment of KPMG.

Items 6 and 7: We recommend opposing the authorisations to repurchase shares, directly or via derivatives. We consider it vital that the Company strengthens its capital position. Taking further into account the negative EPS (EUR -0.01) we consider a share repurchase at this stage as not in the interest of shareholders.

Items 8-12: Shareholder Riebeck-Brauerei has again filed various motions to the agenda of this year's AGM.

Underlying
Deutsche Bank AG

Deutsche Bank is a holding company acting as an international financial service provider. Co. offers a wide variety of investment, financial and related products and services to private individuals, corporate entities and institutional clients around the world. Co. has operations or dealings with existing or potential customers in most countries in the world. Co. is organized into the following six corporate divisions: Global Markets (GM); Corporate & Investment Banking (CIB); Private, Wealth & Commercial Clients (PW&CC); Deutsche Asset Management (Deutsche AM); Postbank (PB); and Non-core Operations Unit (NCOU).

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Proxinvest
Proxinvest

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Expert Corporate Governance Service (ECGS)

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