Uwe Tschaege - Deputy Chairman, Supervisory Board, Employee Representative

Johannes Thormann - HSBC Britta Schmidt - Autonomous Research Matteo Ramenghi - UBS Securities Guillaume Tiberghien - Exane BNP Paribas Riccardo Rovere - Mediobanca Martin Leitgeb - Goldman Sachs Johan Ekblom - Bank of America Anke Reingen - RBC Jeremy Sigee - Barclays

Good morning, everyone. And welcome to Commerzbank Conference Call for the Second Quarter 2013. I’m very much looking forward to guiding you through our results today. Ladies and gentlemen, I’m please to report to you that Commerzbank made further encouraging progress in its strategic repositioning in the second quarter 2013. Further achievements of the strategic change are evident, proving that we are on the right track. Therefore the core bank showed once again the strong performance. Despite ongoing pressure from the low interest rate environment, revenues could be stabilized at €2.26 billion since active margin management and notable volume growth in Private Customers and Mittelstandsbank at compensating effect. The operating profit generated from are core activities amounted to €465 million at the end of Q2 2013. Group’s operating profit of €78 million was influence by the acceleration of de-risking of our non-core portfolios, resulting in an increase of provisions to our U.K. commercial real estate portfolio, as well as reduction of the net investment income through impairment including our U.S. public finance portfolio. In addition, provisions in the core bank in particular in Mittelstandsbank increased as expected. Operating expenses were slight lower quarter-on-quarter as ongoing stringent cost discipline, more than compensated for increasing strategic investment. As you know Commerzbank has approved cost track record and we will continue to focus on expenses. Whereby, the agreement with worker’ council clears the way for considerable cost reduction to fund further planned investments, which will lay the basis for future profitability and market success. In the second quarter 2013, the net result of shareholders improved to €43 after minus €94 million before. The net result for the six months 2013 amounted to minus €51 million. Please bear in mind that this result burdened by restructuring costs of €500 million booked in Q1 and charges on the sale of the U.K commercial real estate portfolio. These two effects only amount to one-off charge of €630 million. Looking at Commerzbank’s risk profile, we see further comprehensive progress in de-risking and disposing of non-core assets. During the last three months, the exposure default in NCA was reduced by €7 billion. Thereby, the portfolio was reduced by €3 billion each in commercial real estate and public finance, as well as by €1 billion in shipping. As communicated, we recent sold the U.K. CRE portfolio of €5 billion. The charge related to the sale was at large reflected this quarter. In terms of volume, the positive effects will become effective in the next quarter, leading to further noticeable portfolio reduction. When including the sales the asset reduction now exceeds our original year end reduction target. During the second quarter we manage to significantly strengthen our Basel 3 full effect in ratio to 8.4% up to 7.5% in Q1. Additionally, our CRD 4 leverage ratio under phase-in assumptions is currently at 4%. Commerzbank clearly over fulfill the requirements proposed without any additional measure. Yes, our foresighted and comprehensive balance management over the past years is paying off. Slide three summarizes Commerzbank key facts at a glance, as such please turn to slide four, showing the development of the Group’s quarterly transition in detail. The Groups operating results for the second quarter amounted €78 million after €469 million in Q1 2013 and €442 million in Q2 2012. Quarter-on-quarter development was mainly driven by an increase in LLP of €270 million to €537 million. Due to the U.K. commercial real estate portfolio, lower releases in the core bank in line with our expectation and single cases in Mittelstandsbank. Group revenues additionally decreased by 6% above all driven by the successful acceleration of de-risking in NCA, including impairment amongst other on our U.S. public finance exposure. Expenses were again tightly under control at €1.7 billion after €1.72 billion the quarter before. Here consequence efficiency measure are kicking in leading to sustainable cost savings, certainly cost management stays on top of our agenda. After tax charge of €12 million and minorities of €23 million, the net result for Q2 stood at €43 million for the Group. To give you more transparency of Commerzbank fundamental underlying operating performance we prepared slides five and six. Adjusted for significant non-operating items such as the own credit spread and credit debt valuation adjustments, revenues in the core bank increase quarter-on-quarter to €2.35 billion, supported by notable volume growth in Private Customers and Mittelstandsbank. Compared to prior year quarter core banks revenues also increased despite a tough interest rate environment, since active margin management and other strategic measures at compensating effects. In Q2 2013 adjusted revenues in NCA of €9 million were hit by the accelerated run down of the portfolio and impairments on public finance investment influencing also the Groups performance. The adjusted operating results shows similar positive trend reflecting the fundamental operating strength of our platform and proving that we took the right steps. All in all, the development in the second quarter is reasonable considering the one-off burdens that had to be observe. Back to the unadjusted revenues in the core bank as shown on slide seven. Quarter-on-quarter, core bank revenues were stable at €2.26 billion and only 3% below prior year, despite a challenging interest rate environment. We were able to compensate this through active margin management, notable new learn businesses, especially in residential mortgages in PC supported by our new open product platform, improve quality of our customer service and product offerings, as well as a stronger brand image, thanks to our new claim fair and competent honored by our customers. The net commission income at €789 million increased year-on-year by 5% and was only 5% below the seasonally strong first quarter. This positive momentum was driven by the securities business and asset management activities in Private Customers. As outlined on slide eight, operating expenses were again under control, despite increasing investment. Since measures focusing on long-term process and efficiency improvements are ongoing, cost levels in the core decreased again by 2% to €1.6 billion quarter-on-quarter. Quarterly personal expenses also decreased slightly despite last year’s collectively agreed wage increases. Following the agreement with our workers’ council that has been reached in June, the alignment of headcount numbers have started ramp up. Implementing the FTE targets will be one of our first priorities in securing Commerzbank’s future profitability. As envisage, major measures of our strategic agenda has been initiated and already took broad effect creating tangible value for our customers. However, in the light of the comparatively moderate economic environment and with respect to a balance cost income ratio, we follow the reasonable investment approach controlled by the bank’s investment committee. All investments are released and scaled on an initiative -- by initiative basis, while closely tracking the return of these activity. During the months to come we expect investments to increase while stringent cost management will broadly ensure compensating effect. As shown on slide nine, we provisioned €190 million for the Core Bank in Q2 2013. LLP increased especially in Mittelstandsbank due to lower releases as well as single cases. As stated before, this increase is inline with our expectations and previous guidance. As before we managed our risk prudently, risk densities in the Core Bank are stable on the low level of 27 basis points and are expected to remain so. The default portfolio was again reduced by €170 million quarter-on-quarter due to successful work-out management and the non-performing loan ratio came further down to 1.8%. Additionally, the coverage could be increased further to 82% despite our conservative collateral valuation approach. As you all know, 2013 is the year of transition for Commerzbank. Systematically and successfully implementing the strategic measures presented to you on our Investors Day is Commerzbank’s clear focus for the upcoming quarter. The strategic measures initiated our already bearing fruit partly above expectations. However, please keep in mind that the related KBI development will not follow a straight line, the measures need time as well as less demanding market conditions to unfold their full potential. The ongoing progress in implementing our strategic agenda is shown on slides 10 and 11. Compared to the status expected for the second quarter, all segments are broadly in line with or above our internal expectations, especially Private Customers are showing proofs of successful repositioning and the rundown of non-core asset is making rapid progress. Personally, I look positively on this development and we reaffirm that Commerzbank is fully committed to deliver on its financial goals for 2016. For more detailed glance at the operating performance of the individual segments of the Core Bank, please turn to slide 12, starting with Private Customers. As I said before, PC is well on track. Our customer satisfaction is constantly increasing, reflected by a strong promoter score and successful evaluations in quality contest. Compared quarter on quarter, revenues at €839 million were almost as high as the seasonally strong first quarter. Year-on-year revenues even increased by 5%. In Q2, we gained new loan volumes in residential mortgages of €2.3 billion or 23% when compared to the last quarter. This is the highest growth in new business since the beginning of 2011. In Filialbank, net new clients, accounts and volumes grew notably. In terms of revenues, we saw the strongest quarter since Q2 2012 and the second consecutive quarter with significant operating contribution. Revenues from direct banking was stable at higher level with €82 million while the inflow of net new money continued. Despite strategic investments in our branded product and services offered, operating expenses were flat at €758 million. All in all, Private Customers finished the second quarter with a positive operating profit of €54 million after €69 million the quarter before. So far, we are pleased to see that the segment is on course. The journey ahead is still long but these results are promising. Please turn to slide 14. Total revenues in Mittelstandsbank decreased quarter-on-quarter by 5% due to evaluation effect of counterparty risk in derivative business. Underlying revenues from direct customer business, however, was stable. Underpinning the leading competitive position of Commerzbank’s Mittelstandsbank. Following our strong customer franchise, revenues from the Germany Mittelstand increased to €396 million, driven by higher credit demand from German midcaps and the documentary business. Revenue contribution of financial institutions was stable at €103 million since strong foreign trade business is supported by our unique market position over compensated negative valuation effects. Grosskunden & International clients however showed lower revenues in line with reluctant credit demand. Looking at the LLP development, provisions rose due to lower releases as expected as well as single cases. In Q2, 2013, we booked a charge of €147 million, which is €69 million more than the quarter before. Expenses were flat. All in all, the operating profit stood at €216 million after €326 million the quarter before. Central and Eastern Europe was marked by a strong BRE Bank result. The Q2 operating result stood at €52 million after €75 million the quarter before. Revenues from dealing and commission income developed positively despite persisting subdued economic environment in Poland. Net interest income was stable. LLP increased by €30 million as expected since the lower level in Q1 benefited from releases. The cost base was flat leading to an attractive cost income ratio level of just under 55%. As shown on slide 17, Corporates & Markets submitted yet another strong quarter after very good start into 2013. Thanks to our client-centric market positioning, we were able to take advantage of the positive momentum reflected in higher market indices, tighter credit spreads and high-client activity. Revenues in Q2 were driven in particular by corporate finance as well as by a renewed risk appetite from clients in equity markets and commodities. Operating revenues excluding the effects from the OCS and credit/debt valuation adjustment increased quarter-on-quarter by €47 million to €589 million. The recorded operating result in Q2 amounted to €253 million. Excluding the OCS effect of €20 million and the net CVA/DVA effect of minus €40 million, the operating result stood at €273 million. Hence the strongest quarter since mid of 2011. Let’s have a look at the divisional split of Corporates & Markets on slide 18. The revenue contribution of corporates increased quarter-on-quarter to €155 million with clients continuing to be very active in DCM loans and bonds. We have strengthened our multi-currency competence in bonds, for instance, via the extension of our offshore renminbi bonds, and Swiss franc bonds offering. Corporates & Markets has also gained market share in bond issuance with international financial institution. Revenues in equity and market and commodities improved strongly quarter-on-quarter to $186 million, taking advantage of a strong European market position in Zurich to securitize products. Corporates & markets is now able to offer Asian issuers the same market making service as our European client base after having been granted securities market maker status in Hong Kong. Corporates & Markets also succeeded in maintaining its position as the leading German specialist broker. The operating performance of fixed income and currencies were $143 million, decreased since client activities were slower in rates as sales and trading however improved. Year-on-year, the operating performance doubled. We are expanding our services by joining new central counterparties and adding further asset class. Revenues and credit portfolio management showed a contribution of $150 million. Year-on-year we saw higher performance since structured credit legacy was not recorded as part of CPM in Q2 2012. Now, let’s have a closer look at non-core assets as outlined on slide 19. As announced, we recently sold our U.K. commercial real estate portfolio of €5 billion. The sale was executed at a small discount of 3.5%, externally proving our adequate risk assessment and portfolio valuation approach. The overall charge for the sale amounted to €179 million, of which €134 million were booked this quarter. In addition, the ongoing portfolio wind-down and impairments including our U.S. public finance exposure led to lower revenues. LLP increased quarter-on-quarter by €172 million to €347 million, driven by the U.K. commercial real estate portfolio. LLP for ship finance at €110 million were lower quarter-on-quarter as well as year-on-year driven by less portfolio based provisions. Looking forward, we expect LLP for shipping to remain on the lower level of 2013. Although, some industry peers are already seeing first tendency of revival especially in certain market sub-segment, we are holding on to our cautious outlook. After all NCA finish Q2 with loss of €387 million, including the charge for the sale of the U.K. commercial real estate portfolio. As already highlighted, we are continuing with our successful de-risking and asset reduction strategy as shown on slide 20. Throughout the second quarter the good momentum and asset reduction in NCA, continued across all sub-segments. During the second quarter, the EaD was reduced by €7 billion with out significant deterioration of portfolio quality. This reduction however does not yet reflect the sale of the U.K. commercial real estate portfolio. Within the last year, the exposure even shrank by €27 billion, thereby the portfolio reduced was reduced by €15 billion or 24% in commercial real estate and €9 billion or 11% in public finance. Additionally, I’m pleased to report that the EaD in ship finance came also down by €3 billion or 15% despite tough ship market. On slide 21, you’ll find a brief summary of the successful sale of our total U.K. commercial real estate portfolio of €5 billion, being one of the largest transactions in commercial real estate loan in Europe over the past years. The transaction was executed at the low discount to book of 3.5% improving the adequate valuation of our portfolio. The transaction as a whole, has no notable impact on capital, while, clearly improving our risk profile. By this sale, the non-performing loan book will be reduced by €1.2 billion or 17%, while the performing but higher risk cluster will decline by € 3.9 billion or 45%. Here, we are successfully delivering on reducing risks and we will continue to take advantage of market opportunities, while optimizing our shareholders value. Due to this transaction, we now update the original reduction target in non-core assets to significantly less than €90 billion at the end of 2016. The development of our risk and capital position is outlined on slide 22. Quarter-on-quarter and year-on-year, risk weighted assets came down by 2% to €206 billion. Due to lower credit risk since the run down of non-core portfolio offset the growth in our productivities. All-in-all, Commerzbank's Core Tier 1 ratio under Basel 2.5 stood comfortably at 12.1% clearly exceeding all current regulatory thresholds. Quarter-on-quarter increase was driven by lower RWA and the repayment of the silent participation of Allianz. Slide 23, gives you in impression of the effect of Basel III. Commerzbank's Core Tier 1 ratio under Basel 2.5 stood at 12.1% as at the end of Q2 2013. Considering the estimated net effect of Basel III under phase-in assumptions, Commerzbank's pro forma common equity tier 1 ratio would amount to 10.3% thereby standing comfortably above our target of 9%, as announced on our Investor’s Day. On the Basel III fully phased-in, the pro forma common equity tier 1 ratio would stand at 8.4% which is a significant improvement when compared to last quarter. This development is based on lower RWA and on a higher Basel III capital reflecting per capital increase. Since, the leverage topic is becoming more and more important, we included slide 24. First off, we stand strong on this front. For Commerzbank as the German institution, the European capital requirements directive and regulation will be binding starting with the public disclosure at the beginning of 2015. Regulation are still in flux, we focus on the proposed definition of the leverage ratio under CRD IV. At the end of the second quarter of 2013, our leverage ratio under phased-in reached 4%. Under fully phased-in assumptions, the ratio stood at 3.2%, thereby both ratios clearly exceed the proposed minimum ratio of 3% without further measures. Here, we took the right the steps at an early stage. Our foresighted and comprehensive balance sheet management is now paying off and we are still committed to further reduce the relevant balance sheet exposure, giving us flexibility to comply with various thresholds. Let me also give you a glance at our funding history and outlook as illustrated on slide 25. In the first six months Commerzbank placed €1.1 billion of senior unsecured funding. Additionally, we successfully issued €1 billion of secured funding including Commerzbank first public sector, Pfandbrief. As before ongoing asset reduction and the strong deposit based limit our funding lease in 2013 and the coming years. We expect unsecured capital markets funding to be taken only on an opportunistic and flexible basis to support franchise demand and this funding diversification. I will conclude my presentation by giving you brief outlook on slide 26. First, since the Investor Day in November 2012, Commerzbank has made good progress in implementing its strategic agenda, laying the foundation for future prosperity. However, our outlook for 2013 is unchanged. Revenues will remain under pressure due to ongoing asset reduction and low interest rate. Second, cost management phase on top of Commerzbank management agenda. Since further strategic investments will be funded by cost-efficiencies, we do not expect cost to exceed €7 billion for the full-year 2013. Third, we confirm our LLP guidance for the full-year. Compared to 2012, we expect provisions to increase due to the normalization in the Core Bank and the accelerated rundown in NCA. Fourth, since the rundown of on the non-core portfolio is making great progress; we project the EaD to come down below the level of the €125 billion at the end of this year and significantly below €90 billion by the end of 2016. This is a great achievement despite the ongoing challenging market condition. Fifth, as we have done before, we promise to continue to focus on capital. Commerzbank Basel III ratio on the phase in assumption that currently 10.1% is expected to remain comfortably about 9% at all time. Our fully phase-in ratio improved to 8.4%, while we are fully committed to reach 9% by 2014 latest. Furthermore, our already strong leverage ratio is expected to increase to 4.3% on the phase in and to 3.5% under fully phase in by the end of this year. Ladies and gentlemen, thank you for your attention and I'm now looking forward to answering your question.

(Operator Instructions) the first question comes from Johannes Thormann of HSBC. Please go ahead with your question. Johannes Thormann - HSBC: Good morning everybody. I’m Johannes Thormann, HSBC, Three questions if I may. First of all, regarding as the fee income, can you give us more details why it has been so weak in the second quarter, while come direct and also the German market activity would have suggested at least a stable level? Secondly, on your non-core assets, do you have any potential disposals for Spanish real estate or for shipping, or part of the shipping portfolio to repeat the U.K. non-core deal or do you have anything else in mind? And last, but not least in terms of provisions, what would be a run rate for shipping provisions for the rest of the year after decline in the second quarter? Thank you.

As I may, I’ll probably start from the back off, with respect to be LLP’s on shipping, we have consistently and repeatedly said that we expect the LLPs for shipping to be at the same level of 2012. From that point of view, Q2 was slightly below what you would normally think as being a normal run rate, driven by somewhat lower LLP’s but in general as I said, unchanged on assumptions a run rate of roughly on the basis of 2012, the despite as I mentioned before one or the other increasingly positive market comment. Taking also on this market comment, your questions on whether I'm willing to sell shipping portfolios into same size at least in relative terms and what we have done in U.K. commercial real estate. That is currently not on our focus, we speak to a value preserving, hopefully capital, neutral to capital accretive approach here. And if the market assumptions are right, then we would probably see rising prices rather than falling prices so maybe I hold on a little bit longer to my portfolio, again a still keeping in mind that we obviously want to at de risk and de leverage. That is no bigger deals in the pipeline right now but would respect to commercial real estate or NCA portfolio we are reviewing market opportunities obviously constantly but again, I just said, we speak to our goal that we want to reduce EeD of NCA until the end of year to below €125 million. Fee income in the general, if we look at the net commission income embedded on slide seven in the presentation, you can see the developments. It’s obviously securities which is even increasing compared to last year, the payment transaction business from foreign trade is basically stable. So I'd rather say that we are here on the slide growth path if we compare year-over-year and the slight decrease between the two quarters, one and two this year is more seasonally-driven. Johannes Thormann - HSBC: Okay. Understood. But the growth year-on-year is also driven by transaction volumes. So have we seen any one-off in Q1 then or what has been the driver for that securities and asset management performance?

It’s a normal seasonality of people look at portfolio traditionally at the beginning of the year, ten takes decisions with respect to the general positioning. If you look back in the previous years, we have this, we have this effect seen even on a more pronounced basis. So far, we have successfully managed to Q2 almost on the level to Q1. Johannes Thormann - HSBC: Thank you.

The next question comes from Britta Schmidt of Autonomous Research. Please go ahead with your question. Britta Schmidt - Autonomous Research: Hello.

Hello. Britta Schmidt - Autonomous Research: Hello. Can you here me.

Yeah. We can here you. Britta Schmidt - Autonomous Research: Sorry. Good morning. I've got three areas of questions please. One is on the upcoming asset quality review by the EBA and the ECB stress tests. What are your expectations for this exercise and how it may impact Commerzbank? Have you had any discussions yet with the German regulator and how do you see yourself positioned? Will there be any impact on your views on provisioning potentially the year? The other area is exposure default just two clarifications please? One is in the Private and Business customers area, there was an increase in the foreign subsidiaries and other exposure default which drove most of the increase there apart from where the mortgages? Can you may be clarify what that is? And also tell us how much in the non-core asset division that $7 billion decline, would it be fair to say about half of that was FX rates? And lastly, just on specific issues, could you tell us how much the impact from Detroit was in the quarter and do you have any comments on the recent ISDA rumors in the press?

Okay. Maybe I will startup with the ISDA fix, we have all read in the press that the CHTC has opened formal processes against the number of banks. We are not part of this formal process and according to our own research and to my most recent knowledge, we have no signs for any irregularities around the ISDA fix on the Commerzbank side. Maybe on a more technical issue. The contribution to ISDA fix from our side is pure fully automatic mechanism, where certain deals that has actually happened automatically downloaded and delivered, so that is basically a human free kind of process. On Detroit, I can confirm that we officially through a number of our companies holding exposure to Detroit. I can also confirm that from best point of view, we have taken adequate risk provisioning. I’m not prepared to release how much this is because I guess that will part of lengthy negotiation process with the respective persons as part of the Chapter 9 process. The NCA rundown, your question was, how -- what is the composition of that in Q2? We have see $3 billion in commercial real estate, $3 billion in public finance and $1 billion in shipping, and that there is no relevant foreign exchange effect in this issue. On the issue of what happens on the EAD? If you look at our interim report on page 37, it is capitalized plan assets that were reclassified from the segment other than consolidation into the segments of core bank’s that lead to an increase an exposure compared to the year and the risk density remains stable at 7 basis points. On the asset quality review? My current assumption is, A, it will happen, B, it will happen in the second half of this year. There is also a number of topics and issues that seem to be still under discussion or part of the decision processes on the regulator side. What I can say for Commerzbank is that those issues that has been a frequently discussed, especially shipping, my impression is that having had a number of audits including the (inaudible) at the end of last year that we are well-positioned and I do not see any specific risks there. You can also try to compare a little bit how much of our risk positions levels are in comparison to our peers on publicly available numbers. It seems that we are rather more cautious than the rest of the market. There is to other, if you want so smaller indicators, there has been the RWA Study including equity on the -- on basis of the Basel issues and there has also been a press release yesterday from the EBA on a somewhat similar exercise without disclosing our position on these two exercises and given that they obviously are on -- not real portfolios but at least on model portfolios. I at least can say that, I feel comfortable with the results and so I will see what the AQR finally will really bring. Britta Schmidt - Autonomous Research: Thank you

The next question comes from Matteo Ramenghi, UBS Securities. Go ahead with your question. Matteo Ramenghi - UBS Securities: Yes. Good morning to everyone and thank you very much for the presentation. I have two questions. The first one, again, on the asset quality review. I noticed the coverage for the non-performing loans has increased slightly in the quarter and I was wondering if we should read that also in preparation of the asset quality review? Also, if you expect what the ECB will do to sparkle some consolidation in Europe or in Germany, if you can share any color and any of your thoughts would be appreciated? Second question on net interest income? It was clearly stronger than expected. I think most of the strength was coming from the corporate markets division, probably from the held to maturity book? If you could give some additional color and also clarify if there any trading component within that? Thank you very much.

On the asset quality review, again what you have seen in changes in our coverage ratios is more following the normal pattern of things moving in and out into certain portfolios over the quarters. It is not intentional additional measures that we have been taking to the -- with the view to the AQR. We feel based already on our year end results well-provisioned and good positioned. And again on shipping we have had several audits which have not produced any notable problems or differences to our own assumption, the UK CRE deal just has proven that our valuation assumption seem to be okay. So, in general, nothing on that side. With respect to what the ECBs intentions are and what it might mean for the European consolidation. I think it is just too early to tell and secondly, I think you should probably ask the ECB. Net interest income, again, and I think we have said this before, following the new disclosure rules in Corporates & Markets you need to look at net interest income and trading result, as a whole and together the analytics of only one of the two position is in an investment bank so to say. Not really any helpful, anymore following the new IIS rules. So it is the revenues in total that you need to look at. And in general -- in a more general remark, it is obviously that there is also a certain seasonality in these products given the demand around the yield. Matteo Ramenghi - UBS Securities: Thank you.

Your next question comes from Guillaume Tiberghien from Exane BNP Paribas. Please go ahead with your question. Guillaume Tiberghien - Exane BNP Paribas: Yes. Good morning. I have got two questions. The first one related to the net interest margin in the SME banking business. Could you give us a bit of flavor as to what is the outlook for the next couple of quarters? And then the other question I had relates to the Corporates & Markets. Can you help, give a little bit more clarity as to how the revenue split evolves between net interest margin and trading profit, it's very volatile from one quarter to another, so if you could help us with these two items in the P&L? Thank you.

Yeah. If I maybe start off with the Corporates & Markets issue again. You are completely right, the new disclosure under IAS 1.82 let to this volatility that you have seen. This is why I would say almost of our peers are refraining from explaining net interest income and trading income separately by focus only on revenues in total. This is what I would recommend to do also since the effects are very volatile and may change substantially from quarter-to-quarter and also based on product mix sold. The SME business net interest income which we probably don’t or normally don’t necessarily disclose, let me make some general remarks. The interest rate environment obviously is still difficult, but we are successfully underway with our margin management. So I’m not concerned. In general, I’d say also seeing that in Q3 with the holiday season and the persistent low interest rate environment it would be rather slightly lower than higher, but in any case still look highest. Guillaume Tiberghien - Exane BNP Paribas: Thank you.

Next question comes from Riccardo Rovere, Mediobanca. Please go ahead with your question. Riccardo Rovere - Mediobanca: Good morning to everybody. I have a couple of questions. The first one is on the capital. Now you are at 8.4% full phased Basel 3 and is there anything else you can do on the risk-weighted assets that you may eventually not done yet to eventually improve it the 8.4%? And the second question is, again on NII, is the kind of volatility that we have seen in Corporate & Markets and in Corporate Center, the new normal going forward. Is it going to work like this every single quarter, is this quarter particularly volatile just to understand? Thank you.

If I start off again with the NII. The answer is yes. This is to a certain extent the new normal, whereby part of volatility unfortunately will also be that the quarter as such do not necessarily compare very well, again driven by a different kinds of products which maybe in higher demand in certain quarters than in other quarters. But in general this is the new normal that is why again all of our peers comment and disclose basically on the basis of revenues rather than splitting it up. On the capital side, capital as I said before, is clearly and remains the focus. RWA management optimization is obviously something which is on our agenda always. Nevertheless, I wouldn’t expect any major changes there from today’s perspective. The good thing is that we currently can see RWA growth in the core bank which is a clear sign that we have returned to a growth path there. And the growth in core bank, as I said, has been compensated by the MCA run down. On the capital in general, maybe another remark, taking it is a fact that the leverage ratio is gaining more and more importance. You need now to manage both of these numbers, obviously not only fulfilling the Basel 3 requirements but also the leverage ratio. And again, as I said before, we would stick to our commitment to reach 9% at the end of 2014 on the Basel 3 and the leverage ratio will be improving through the rest of the year since we see the balance sheet at the end of ’13 rather below €600 million than at the current -- €600 billion, sorry, €600 billion rather than at the €637 billion that we have right now. Riccardo Rovere - Mediobanca: And if I may just a follow up one second on loan losses, you are guiding to this year for loan losses a bit higher than last year and would you be comfortable in trying to provide the guidance to the market for the next year?

Uwe?

Next year it’s I think a bit too early. Riccardo Rovere - Mediobanca: I understand the problem.

I mean, what we have said though and I’m happily repeating that. In our assumptions the ship LLPs for 2014 at least from today’s perspective and unchanged to what has been our opinion for the last two, three quarters. Ship LLP in 2014 will most likely also be again on the level of ’13, despite the fact that I have mentioned before that the number of market participants are starting to create a lot more positive noise than we have seen for quite a while. That is still the assumption, but again, the planning process for the upcoming years will be finished somewhere in Q3, Q4 and I think that we’ll then give a better basis. Riccardo Rovere - Mediobanca: Perfect. Thank you.

Thanks.

The next question comes from Martin Leitgeb, Goldman Sachs. Please go ahead with your question. Martin Leitgeb - Goldman Sachs: Yes. Good morning. I have two questions, please. The first is with regards to your cost guidance and if I compare the outlook statement of this quarter with the first quarter, it seems to me that that you’re ahead of your plan in terms of costs, I recall, previously your guiding for cost to increase due to the planned investments? And now if I look at the result in the second quarter costs were lower quarter-on-quarter and you are give me guidance that you expect cost to be below €7 billion. So I just wanted to clarify that that it is mainly due to your cost savings being faster or larger than the initially planned or whether this is largely attributable to the U.K. commercial real estate disposal? And the second question is with regards to your recurring stock on commercial real estate loans, how many commercial real estate loans would you be able to dispose now considering the level of recurring stock or fundraiser you have? I understand that the restriction that you obviously can sale if you don’t have certain role of coverage down, so I just wanted to get a sense for the number and what you could potentially sale this year? Thank you.

Okay. Maybe if I start off with the recurring stock issue. Technically speaking, you can obviously disconnect to a certain extent recurring stock of a certain portfolio from the fundraiser that you have the market as long as you provide a similar recurring stock to run with these fundraiser. So to a certain extent, yes, then maybe a smaller cost item associated with the issue, but in general it is not a block too useful in sensible deals. With respect to the cost guidance, if you compare to the previous quarter, there’s obviously two things, our cost guidance for the total year is lower than it has been before the Q1. And secondly, our LLP guidance is probably a little bit higher given the accelerated de-risking in NCA. With respect whether we are ahead at or around plan, I’d rather put it this way, I think getting down to $7 billion is good. And secondly, we’ll still see probably increasing cost in the second half of this year compared to the first half of this year given that the investments will still grow over the next at least two quarters for this year. Martin Leitgeb - Goldman Sachs: Okay. Thank you very much.

The next question comes from Johan Ekblom from Bank of America. Please go ahead with your question. Johan Ekblom - Bank of America: Thank you. Can we just go back to the non-core asset division please? And I guess, first just for clarification, you said the -- that you want to have exposure default below €125 billion at the end of this year? That's including the default exposure? If you can just confirm that? And then secondly, just you're talking about increased margin in the non-core offsetting the run-off, you're talking about some growth in the core bank. At the same time, you're making some pretty cautious comments on the revenue outlook. So can you talk a little bit about what's needed to offset the underlying revenue pressure whether it's what's coming from low interest rates or what’s coming from the non-core runoff in order to stabilize revenues as we look forward?

Starting off with your NCA. Again the €136 billion of EaD that we currently have at NCA do include the non-performing loans, as well as the €125 billion or below €125 billion to be more precise at the end of the year include the non-performing loans. On the cautious outlook with respect to revenues, I think we need to keep in mind that the first half of this year, obviously includes strong results from our Corporate & Market divisions, and it is hard to assume that they will be as strong also in Q3 and Q4 because that’s normally doesn’t follow the normal seasonality and especially the Q3 as we all know driven by the holiday season normally is below the previous quarter. That is one of the main drivers. The key message again on the segment PC and MSB is that our customer business we are returning to growth past year, especially in PC if you keep in mind that we have gained 100,000 net new customers in the first two quarters that is obviously a very sound basis for future growth. Although, it obviously takes time to turn the new customer into real revenue and even takes a little bit longer to turn them into the net profit. Johan Ekblom - Bank of America: Okay. And maybe just one follow up on the non-core assets, I mean you had a weak net investment income and you clearly linked that to the faster than expected runoff of the non-core assets? How should we think about that going forward? I mean it sounds like you’re pretty ambitious or optimistic about the ability to keep at high pace in the runoff? Should we expect a similar negative net investment results in the quarters to come as a result?

Yeah. Without going into too much detail, we have said that the net interest, that the performance of NCA is obviously also including effects from adjustments to our U.S. public finance portfolio and it’s pretty obvious that we are talking about Detroit as said before, I’m not willing to disclose the number but it’s a reasonable substantial number that has been taken here doing that. Johan Ekblom - Bank of America: Okay. Thank you.

The next question comes from Anke Reingen, RBC. Please go ahead with your question. Anke Reingen - RBC: Yeah. Good morning. I just wanted to follow-up on the shipping portfolio please? When you've stressed a number of times your conservative guidance, yet you say Q2 was actually quite encouraging, as well as other comments by peers. I just wondered why are you not more -- why you sort of like continue to reiterate your conservative guidance, is it that you just prefer to improve on your coverage and also, what is outlook on risk weightings on the shipping portfolio, because I think it slightly increased quarter-on-quarter? And then I just wondered the reduction in the shipping book in Q2, was it like an actual sale or maturity and on what terms if you can say, if you sold it was the transaction done? Thank you.

Yeah. Maybe if I start off with the RWA question in shipping, we currently have RWA level that is even slightly exceeding our shipping volume. So I don’t see a further increase. If we would really see easing markets, this definitely has a potential for some releases not sure whether that will happen next year. Also here I am sticking to my assumption so far that we will see from our point of view and that also explains why we stick to our original guidance. And we still believe that the upturn in the shipping markets will rather happen in 2014 than in 2013. The shipping EaD reduction was driven by repayments maturities and that is proving mainly the main differences, yeah. Anke Reingen - RBC: Thank you.

The last question comes from Jeremy Sigee from Barclay. Please go ahead with your question. Jeremy Sigee - Barclays: Hi. Good morning. Just three sort of follow-on questions please. On the leverage ratio, I think your 3.2% for the applied right now is on a (inaudible) Hello.

Hello.

Yeah. Hold on a second please. Jeremy Sigee - Barclays: Hello.

Yeah. Mr. Jeremy, please go ahead. Jeremy Sigee - Barclays: Hi, can you hear me now?

Sorry, we lost you. Yes, now we can hear you. Jeremy Sigee - Barclays: Okay. Three questions please, your leverage ratio for the applied 3.2% if I'm understanding correctly is pure CET1, do you plan additional Tier 1 issuance any time soon, Basel III eligible? Second question, Corporates & Markets better than expected, as you partly discussed. Is there any change of strategy there? Is there any change in what you're doing in any of the businesses or how you're thinking about the growth potential of that business? And final question, I just wanted to come back again onto the Mittelstand, and particularly the Grosskunden & International division, which was disappointing, and just wondered do we expect that to snap back to the previous run rates in 3Q/4Q?

On the leverage ratio in simple terms I am not planning for any major capital measures here. I think with these numbers and keeping in mind that they would rather improve towards the end of the year that clearly give us no signal whatsoever to do something immediately. Corporates & Markets besides the obvious market recovery, it is pretty clear that the connectivity which we especially have with our Mittelstandsbank business in situations like this clearly paying off. With respect to the gold scoring in that international development, let me put it this way that is traditionally that part of the market where we have the fiercest competition based also on margins. And we are just not willing to go and win especially every margin fight, so that has also as certain component of voluntary business management rather than something where we lost market for without own intention. Jeremy Sigee - Barclays: So the negative valuation effect that bit presumably bounces back in the rest of the year but the lower revenues from customer behavior doesn’t I guess.

Let me put it this way but the best thing about valuation effect is that they have a certain volatility. So statistically speaking yes there is a certain assumption that they may bounce back when and how it happens. I’m pretty much not able to tell you. Jeremy Sigee - Barclays: Okay. Thank you very much.

Thank you.

There are no further questions left.

Ladies and gentlemen, thank you very much for your attention and the questions. And I wish you all a successful day and looking forward to see you latest at Q3. Thank you.