Deutsche Bank AG

The positive outlook reflects our view that in the next 12 months it will become clear if management has substantially delivered the financial targets that would place Deutsche Bank's performance more squarely among its European peers at the low 'A' to high 'BBB' rating level. However, we acknowledge that uneven operating conditions could squeeze revenues and asset quality metrics more than management expects, particularly if economic recovery is significantly delayed. Our base case also assumes the maintenance of sound capital and liquidity buffers, in line with management guidance. We would likely raise our long-term ICR if we have greater confidence that the final phase of strategic execution of the restructuring plan will deliver much stronger profitability from 2022, close to

...Our base case for Deutsche Bank has long centered on two key expectations. First, it would emerge from this deep, but short-term, cyclical downturn with a resilient balance sheet; and second, it would clearly benefit from a more efficient, focused, and well-controlled business and operating model. We remain confident in the bank's likely resilience. This leaves the second element--restructuring and transformation--as central to our decision on whether to raise the issuer credit rating (ICR). Successful delivery would help management to deliver its targeted 8% return on tangible equity (ROTE) by 2022 but, most importantly, it would enable the bank to achieve the operating and franchise stability and the sustainable, predictable performance that it has lacked since 2014. Management has established strong credibility in delivering the operational restructuring that started in 2019. Management has so far delivered on all its cost-focused financial targets, and by end-2021 the transformation...

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