DVB Group's Annual Report 2013

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DVB Group's Annual Report 2013

  1. 1. 2013 Annual Report
  2. 2. DVB Bank SE | Group Annual Report 2013 Contents Group management report 40 – 179 41 Stragey and commercial management system 48 Shipping Finance 62 Aviation Finance 82 Offshore Finance 96 Land Transport Finance 110 Important deals 2013 112 Financial Institutions 116 Investment Management 124 ITF International Transport Finance Suisse AG 126 Financial position and performance 142 Remuneration 144 Non-financial performance indicators/sustainability 151 Report on material events after the reporting date 152 Report on opportunities and risks 176 Report on expected developments for 2014 179 Explanatory disclosures under takeover law 179 Report of the Board of Managing Directors on relations with affiliated companies Consolidated financial statements 180 – 240 181 Income statement 181 Appropriation of profits 182 Statement of comprehensive income 183 Statement of financial position 184 Statement of changes in equity 185 Cash flow statement 186 Segment report 187 Notes Audit opinion 241 Further information 242 – 252 242 DVB worldwide 244 Key words 246 Glossary 250 Abbreviations 252 Imprint U3 Key figures at a glance U4 Events 2013 The Company 01 – 33 01 Mission Statement 02 About us 10 Letter to our shareholders and business partners 13 The Board of Managing Directors 14 Report of the Supervisory Board 19 The Supervisory Board 20 Corporate Governance Report 2013 30 Our employees Financial and equity markets 34 – 39 34 Financial markets and DVB’s financial markets activities 36 Equity markets and the DVB share 39 Financial calendar 2014 Reference to the internet Legal notice Further information Symbols
  3. 3. DVB Bank SE | Group Annual Report 2013 Key figures at a glance € mn 2013 2012 % Earnings data Net interest income 241.8 230.0 5.1 Allowance for credit losses –87.1 –70.7 23.2 Net interest income after allowance for credit losses 154.7 159.3 –2.9 Net fee and commission income 128.7 130.7 –1.5 Results from investments in companies accounted for using the equity method 5.1 8.5 –40.0 Net other operating income/expenses –4.1 42.7 – Net income 284.4 341.2 –16.6 General administrative expenses –178.8 –184.0 –2.8 Consolidated net income before IAS 39 and taxes 105.6 157.2 –32.8 Net result from financial instruments in accordance with IAS 39 18.2 –15.8 – Consolidated net income before taxes 123.8 141.4 –12.4 Key financial indicators (%) Return on equity (before taxes) 10.3 12.9 –2.6 pp Cost/income ratio 45.9 46.5 –0.6 pp Key items from the statement of financial position Business volume 24,576.3 25,117.9 –2.2 Customer lending volume 20,757.6 22,146.9 –6.3 Total assets 23,363.1 23,804.8 –1.9 Loans and advances to customers 18,896.9 19,908.3 –5.1 Deposits from customers 6,113.6 5,172.9 18.2 Securitised liabilities 11,134.5 11,391.4 –2.3 Subordinated liabilities 363.7 411.8 –11.7 Equity 1,398.9 1,328.9 5.3 Own funds in accordance with the German Banking Act Tier 1 capital 1,193.3 1,236.0 –3.5 Tier 2 and tier 3 capital 163.6 201.1 –18.6 Total 1,356.9 1,437.1 –5.6 Capital ratios in accordance with the German Banking Act (%) Tier 1 ratio (Basel II) 19.6 20.3 –0.7 Total capital ratio (Basel II) 22.2 23.6 –1.4 Staff by business division Transport Finance/Investment Management 302 305 –1.0 Service areas 213 199 7.0 LogPay Financial Services 52 54 –3.7 Total active staff 567 558 1.6 Ratings 2013 2012 2011 Standard Poor’s Long-term counterparty credit rating A+ A+ A+ Short-term credit rating A-1 A-1 A-1 Outlook stable stable stable Fitch Ratings1) Long-term issuer default rating A+ A+ A+ Short-term issuer default rating F1+ F1+ F1+ 1) Within the scope of the German Co-operative Financial Services Network’s rating
  4. 4. DVB Bank SE | Group Annual Report 2013 Events 2013 22 May Placement of DVB’s third senior unsecured benchmark bond – with this five-year, €500 million bond, DVB underscored its strong position on the capital markets whilst diversifying its international investor base. The fourth €500 million benchmark issue, a seven-year bond, followed suit in November. 13 June Ordinary Shareholders’ Meeting at the Hermann Josef Abs Saal in Frankfurt/Main – with 96.69% of capital represented at the meeting, shareholders approved all proposed resolutions with a majority close to 100% (including a dividend of €0.60 per no-par value share). 18 June “The History of DVB Bank 1923–2013” – published by DVB on the occasion of its 90-year anniversary. This look at the Bank’s history is available in a printed version, as well as in PDF and e-paper format, in German and English.  “The History of DVB Bank 1923–2013” is available on our website www.dvbbank.com About us Company history. 1 July Mr Ralf Bedranowsky joined DVB’s Board of Managing Directors – he came from Deutsche Bank, where he was responsible, as Global Head of Deutsche Shipping, for the bank’s global shipping finance activities, as well as for related investment banking activity and wealth management. 7 November Client Account – as a new service, DVB began offering its Transport Finance clients the possibility of accessing their accounts via an online portal, anytime, anywhere. 17 January Annual DVB client event in Singapore – the members of DVB’s Board of Managing Directors, Messrs Wolfgang Driese, Bertrand Grabowski and Dagfinn Lunde, and numerous DVB staff members welcomed more than 220 guests from various Asian nations. 4 March Client reception in Dubai – Dagfinn Lunde and Geir Sjurseth, Head of the Offshore Finance division, welcomed more than 60 inter- national clients. Offshore Research informed about “The Offshore Supply Market – A Regional Focus”. 7 March Annual Accounts Press and Analysts’ Conference – Messrs Driese and Lunde presented the consolidated financial statements for 2012 and outlined the situation on the international transport markets. 20 – 21 March CAPA Aviation Finance Summit (Asia) in Singapore – Mr Grabowski moderated a panel discussion entitled “The economic life of an aircraft, depreciation policies and value retention. Are we getting the picture?” 3 April Client reception in Oslo – Offshore Finance presented the latest developments on offshore markets. 18 April DVB client event in Hamburg – Shipping Research spoke to more than 100 guests about factors influencing supply and demand in the container segment, as well as expected adjustments to market structure.
  5. 5. Anhang 1 UNTERNEHMEN FINANZ- UND AKTIENMÄRKTE KONZERNLAGEBERICHT KONZERNABSCHLUSS DVB Bank SE | Group Annual Report 2013 The leading specialist in international transport finance At DVB, we make deals work. This means striving to seek and develop intelligent and appropriate solutions that meet and even exceed our clients’ needs and expectations. We go the extra mile to constantly and thoroughly research and study our industry. Often, this leads us to challenge conventional wisdom when offering our focused range of financing services.
  6. 6. DVB Bank SE | Group Annual Report 2013 Shipping Finance – Specific sector expertise Our dedicated and sector-focused expertise brought about deep insight and a wide market-coverage. The constrained activity of traditional shipping lenders presented good opportunities for Shipping Finance in 2013 to fill the void and win attractive risk-reward transactions with customers that were previously out of reach, in terms of pricing. Thus, in spite of continuous oversupply, low freight and time charter rates in some segments of the maritime shipping industry, DVB’s Shipping Finance has once again been able to support its clients with 85 selected new transactions totalling €2.0 billion. Our unique sector coverage, in-depth market expertise, and engrained risk management helped to maintain a solid financial performance in 2013. © Photographer: Herman Ijsseling, Flying Focus, Bussum, The Netherlands
  7. 7. DVB Bank SE | Group Annual Report 2013
  8. 8. DVB Bank SE | Group Annual Report 2013 Aviation Finance – Integrated platform solutions In a year of abundant liquidity for aircraft assets, right across the capital spectrum, our Aviation Finance has demonstrated an excellent performance. Our continued leadership in the market has been in evidence via the breadth of our cross-platform commercial activities and through the recognised work and contributions of Aviation Research. We finished the year having completed 48 new structured lending transactions with a volume of €1.8 billion comprising a good mix of new and used aircraft financings for a diversified group of clients in terms of geographic location and credit standing. Our activities have been recognised with two prestigious industry awards – the “Used Aircraft Deal of the Year 2012” by Air Finance Journal and “Aviation 100 Equity Deal of the Year” by Airline Economics/Aviation News. © Photographer: Sebastian Lukasiewicz, Warsaw, Poland
  9. 9. DVB Bank SE | Group Annual Report 2013
  10. 10. DVB Bank SE | Group Annual Report 2013 Offshore Finance – Highly specialised industry The offshore and energy industries are driven by distinct demand drivers compared to the shipping industry. Taking account of these structural differences, DVB established a separate Offshore Finance division at the beginning of 2013. The Bank bundled its expertise to continue financing highly specialised offshore equipment integral to offshore drilling, exploration, production and field maintenance. During the year, the market con- tinued to do well, backed by a high level of oil majors’ exploration and production spending. Coupled with an increased debt and equity demand, our clients had diverse measures of raising capital at hand allowing DVB to offer a variety of structured debt financings, advisory and capital market services. The team closed 24 new transactions totalling €508,3 million. © Photographer: Petroserv S.A., Rio de Janeiro, Brazil
  11. 11. DVB Bank SE | Group Annual Report 2013
  12. 12. DVB Bank SE | Group Annual Report 2013 Land Transport Finance – Consistent client franchise In a market environment that continued to be characterised by uncertainty and economic conditions – which were not always positive – our Land Transport Finance division was active throughout 2013 on our target markets: Europe, North America and Australia. Throughout 2013 we were one of the few financiers that supported market participants in a consistent and flexible fashion. The team executed 16 new transactions with an aggregate volume of €434.7 million. Thanks to our market expertise, we were able to build a solid bridge connecting demand from the land transport sector, our clients’ individual needs, and the requirements of financing providers. To us, this is evidence that our specialisation continues to be appreciated by clients and partner banks alike. © Photographer: Wouter Radstake, Head of Land Transport Research, DVB Bank SE, Frankfurt/Main, Germany
  13. 13. DVB Bank SE | Group Annual Report 2013
  14. 14. 10 DVB Bank SE | Group Annual Report 2013 Letter to our shareholders and business partners Offshore Finance division on 1 January 2013. The new division comprises our business activities in financing offshore production assets, reflecting the importance of this target segment for DVB. Moreover, Offshore Finance also underscores the diversification of our business model and proved to be a strong profit contribu- tor. DVB’s Aviation teams confirmed their rank as leaders in the industry and performed very well in 2013. Our Aviation platform is strong and the fees generated from its advisory and asset management are at an all-time high. Once again, our staff have shown exemplary commitment while faced with numerous addi- tional challenges. We would like to express our sincere thanks to them. We know that they will do their best to keep DVB on course, going forward. Our environment in 2014 – a general outlook Having spent more than five years in crisis mode increases the likelihood of failing to notice – and fully perceive – any positive signals. And indeed, there are positive signs. The global economy has the potential to accelerate, to see growth rates between 3.5% and 4% in 2014 – which raises the scope for growing global trade and higher demand for transport capacity. However, the recovery is inconsistent and fragile with downside risks remain- ing. Market observers expect air traffic to grow by around 5%, more or less driven by higher passenger demand, whereas the cargo market is set to remain difficult. Excess capacity continues Ladies and Gentlemen, In last year’s letter to our shareholders and business partners, we pledged to confront the challenges head on. And throughout 2013, this was exactly what we did – albeit in an environment that continued to challenge our industries. DVB’s net interest income rose by 5.1%, reflecting a slightly higher level of new Transport Finance business (up 2.2%, to €4.7 billion), with an improved net interest margin. At €128.7 million, net fee and commission income only fell slightly short (–1.5%) of the record level posted in the previous year. Increased capital market, asset management and advisory activities were important contributors. Reflecting the continuing crisis in some maritime shipping segments, allowance for credit losses of €87.1 million (2012: €70.7 million) reached a high, with an additional €23.7 million in expenses for vessels under our control recognised in interest income. Consolidated net income before taxes amounted to €123.8 million, down 12.4% year-on-year. When comparing results with the previous year, two effects need to be taken into con- sideration: the significant extraordinary income realised in 2012 upon the sale of a partial stake in TES Holdings Ltd, specialised in part-out of aero engines, as well as the positive change in the IAS 39 result. At 10.3%, return on equity before taxes (a key controlling indicator) was slightly lower than our previous target range, whereas the cost/income ratio – our efficiency indicator – improved to 45.8% (2012: 46.5%). We will propose to the Annual General Meeting an unchanged dividend of €0.60 per share, which corresponds to a dividend yield of 2.44%. For the first time since the beginning of the financial markets crisis, DVB was able to fully cover its annual funding require- ments, thus achieving an objective that was indeed very impor- tant to us. This was made possible by significantly broadening our investor base, though we were only able to partially satisfy the surprisingly strong demand from international investors. We would like to emphasise that we have always adhered to our principle of relying on maturity-matched funding for long-term lending – and will continue to do so, without restriction. Our “Unity” project – which provides for the harmonisation of structures and processes, and is designed to enhance the effi- ciency of the Shipping Finance division – is progressing on schedule, and is expected to be largely completed in 2014. The work of our restructuring unit for distressed shipping finance exposures has had a stabilising effect. We established our new Wolfgang F. Driese, CEO and Chairman of the Board of Managing Directors
  15. 15. 11 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Letter to our shareholders and business partners to burden the respective shipping segments. On a positive note, demand in these segments keeps growing by an average 5% year-on-year, similar to other transport sectors. Note that all these forecasts assume oil prices remaining at their current high levels, and that it is indeed impossible to plan for any external shocks. Our environment in 2014 – a specific outlook on DVB We pointed out the extreme tightening in our regulatory environ- ment on numerous occasions – likewise, we clearly pointed to growing operating risks and the constantly rising costs involved in managing a bank. To illustrate our point, we have selected two specific examples, which we will supplement by outlining direct cost burdens we have incurred to date. Example 1 – complexity The Basel I rules were written on 30 pages. The Basel II frame- work already had 340 pages, and Basel III extends to more than 1,600 pages. Note that not all applicable standards have been published yet: the CRR and CRD IV directives are impending, and the grand total is expected to exceed 3,000 pages of regulations. Complying with these extensive regulations dramatically boosted the complexity involved in managing a business. In fact, this increasingly turns into a very significant operational risk. Example 2 – a group’s internal funding Bank loans to third parties are subject to certain maximum limits defined in relation to its equity. This so-called large exposure threshold is no doubt justified. To date, the Bank’s loans extended to its subsidiaries, to refinance their business activities, were exempt from this threshold – and for good reason: centrally funding all lending subsidiaries abroad has obvious benefits, since only the parent entity needs to access the markets, thus optimising transparency, control, and the costs involved. However, a draft bill in Germany proposed to include this group- internal funding under the large exposure threshold. This means that our subsidiaries’ potential for growth will be constrained over the medium term, and we will have to change our Singapore subsidiary into a branch. The extensive application procedure will require up to nine months. Obviously, it will involve signifi- cant internal efforts as well as external costs: the expenditure for this project alone will amount to at least €0.5 million. It is important to note that our business has not changed at all – we are merely complying with a new rule that will additionally bring about competitive disadvantages on an international level. Ralf Bedranowsky, Member of the Board of Managing Directors Bertrand Grabowski, Member of the Board of Managing Directors
  16. 16. 12 DVB Bank SE | Group Annual Report 2013 Despite more intense competition posed by the capital markets in some parts of our Aviation Finance and Offshore Finance businesses, we continue to expect them to post a strong contri- bution to earnings. We expect our Land Transport Finance business to continuously grow, on both sides of the Atlantic. We anticipate higher profit contributions from our Investment Management division and our capital markets activities over the next years. Given the prevailing low interest rate environment and the rising regulatory costs, we decided to redefine our target range for return on equity before taxes, at 10% to 12%. Our focus for 2014 • We will continue to work out individual problem exposures in our Shipping Finance division. • We will continue implementing the “Unity” project. • We will further enhance the net interest margin in our lending business while not compromising on risk. • We will expand our off-balance-sheet advisory and capital markets business. Even though we cannot fully exclude any setbacks, our confidence is growing. We are used to working hard. And we will continue to do everything in our power to satisfy our clients – to their own benefit, and to the Bank’s. Yours sincerely, The additional regulatory costs  are based on proven internal calculations. They do not even include the significant extra workload for our staff, nor the operational risks caused by the new regulations, which are hard to quantify. For DVB, this leads to the assessment that over the past five years, we spent at least €70 million in additional costs to comply with and to report according to new regulatory requirements. We might have been able to use this amount for distributing extra dividends, for generating new business, or to strengthen our capital base. Whether or not these regulations have ulti- mately enhanced the security of German banks or the trust in the financial system, remains, in our view, an open question. Outlook and forecast Aside from the regulatory framework, we are cautiously optimistic for the 2014 business year. In fact, we are possibly somewhat more optimistic than last year – based on a slightly better out- look for returns, both for net interest income and net fee and commission income. We will not be able to fully offset the antici- pated further increase in regulatory costs through the savings measures we have initiated (with our “Unity” project). We have maintained our projections for risk costs at the level of the last two years, reflecting our expectation that the shipping segments under stress – container carriers, bulk carriers and crude oil tankers – will not recover from the trough reached before 2015, with a slow recovery afterwards. Wolfgang F. Driese CEO Chairman of the Board of Managing Directors Ralf Bedranowsky Member of the Board of Managing Directors Bertrand Grabowski Member of the Board of Managing Directors Frankfurt/Main, March 2014 DVB Bank SE Letter to our shareholders and business partners 40 30 20 10 0 1.4 1.9 2009 1.4 3.1 2010 4.3 2.8 2.9 2011 3.6 4.5 2012 3.6 8.2 2013 32 24 16 8 0 General administrative expenses (staff expenses for additional head count, non-staff costs, taxes on bonus payments) Bank levy Interest burden (liquidity reserve, tier 2 capital issues) Percentage share in consolidated net income Additional regulatory costs incurred between 2009 and 2013 Share in consolidated net income € mn (%)  4.3% 4.3% 9.1% 18.4% 26.2% 14.9 17.1
  17. 17. 13 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS The Board of Managing Directors (since 1 January 2014) Wolfgang F. Driese CEO and Chairman of the Board of Managing Directors and bank director Born 1949 in Berlin, Germany Client areas in business divisions: Shipping and Offshore Credit, Aviation Credit, Land Transport Credit Strategic Management Restructuring Team Shipping Offshore Research, Aviation Research, Land Transport Research Financial Institutions Investment Management (Shipping Intermodal Investment Management, Aviation Investment Management) Client areas in affiliates: LogPay Financial Services GmbH ITF International Transport Finance Suisse AG Product/service areas: Group Legal Group Human Resources Group Risk Management Group Controlling Group Corporate Communications Group Compliance Office Chairman of the Supervisory Board DVB Bank America N.V., Willemstad, Curaçao Chairman of the Board of Directors DVB Group Merchant Bank (Asia) Ltd, Singapore DVB Holding (US) Inc., New York, USA DVB Transport (US) LLC, New York, USA Member of the Board of Directors DVB Transport Finance Ltd, London, United Kingdom DVB Capital Markets LLC, New York, USA Chairman of the Board of Directors ITF International Transport Finance Suisse AG, Zurich, Switzerland DVB Invest (Suisse) AG, Zurich, Switzerland Ralf Bedranowsky Member of the Board of Managing Directors and bank director Born 1958 in Berlin, Germany Client areas in business divisions: Shipping Finance Offshore Finance DVB Corporate Finance Client areas in affiliates: DVB Capital Markets LLC Product/service areas: Group Operations Group Finance Chairman of the Board of Directors DVB Capital Markets LLC, New York, USA Member of the Board of Directors DVB Holding (US) Inc., New York, USA DVB Transport (US) LLC, New York, USA Bertrand Grabowski Member of the Board of Managing Directors and bank director Born 1956 in Guerche-de-Bretagne, France Client areas in business divisions: Aviation Finance Land Transport Finance Client areas in affiliates: DVB Transport Finance Ltd TES Holdings Ltd (40% shareholding) Product/service areas: Group Audit Group Treasury Chairman of the Board of Directors DVB Transport Finance Ltd, London, United Kingdom Member of the Board of Directors DVB Transport (US) LLC, New York, USA DVB Capital Markets LLC, New York, USA DVB Holding (US) Inc., New York, USA
  18. 18. 14 DVB Bank SE | Group Annual Report 2013 Report of the Supervisory Board Key topics of discussion were DVB’s business and financial performance in a persistently challenging environment – particu- larly in parts of the shipping industry – developments on the international transport markets, as well as the Bank’s activities in managing risk, liquidity, and capital. During Supervisory Board meetings, the Board of Managing Directors comprehensively informed us on the development of strategic parameters of DVB’s business model, resulting adjustments to future business policy, as well as on company management and planning (includ- ing the planning parameters for the Bank’s financial resources, budgeted results, liquidity and human resources), on Corporate Governance issues as well as on events, results and transactions that were and still are important to DVB. The Credit Committee in particular discussed DVB’s risk situation and risk management in detail, providing regular and detailed information to the plenary meetings of the Supervisory Board. The minutes of Credit Committee meetings were made available to all Supervisory Board members. Moreover, the Supervisory Board was informed about current events and transactions of fundamental importance which were subject to joint discussions with the Board of Managing Directors and – where required – approved by the Supervisory Board. Mr Wolfgang Driese, CEO and Chairman of the Board of Managing Directors, and Mr Frank Westhoff, Chairman of the Supervisory Board, held regular discussions which focused on issues specific to the Bank, and on decisions to be made, in a timely and comprehensive manner. The Board of Managing Directors informed us in writing of important developments between Supervisory Board meetings, thus permitting the Supervisory Board members to exercise their control function at any time. We adopted any resolutions that were necessary between Supervisory Board meetings by way of circulation. The Supervisory Board’s activities and co-operation with the Board of Managing Directors were always characterised by mutual trust, and by open and constructive discussions. Meetings of the Supervisory Board The Supervisory Board met during five scheduled plenary meet- ings in 2013. During these meetings, we regularly discussed the business development of the Bank and its subsidiaries, in great detail. The Board of Managing Directors and the Heads of Division gave a detailed account of the sector-specific and macroeconomic environment on the international transport Dear shareholders, Despite the relief provided by the macroeconomic framework, individual international maritime shipping market segments continued to be shaped by excess supply. At the same time, additional regulatory requirements were clearly imposed upon banks. Compared to its international bank competitors, DVB nonetheless succeeded in generating a solid performance on the transport finance markets, which was reflected in attractive consolidated net income. We would like to express our sincere thanks and appreciation to the Board of Managing Directors and all members of staff for their performance and the results achieved. The Supervisory Board, jointly with its committees – the Credit Committee and the Executive Committee – has fulfilled the obligations imposed on it by law, the Memorandum and Articles of Association, and the Bank’s Internal Regulations throughout the past business year. We have taken decisions on transactions and issues requiring approval, closely advised the Bank’s Board of Managing Directors, and have continuously supervised the management of the Company and the Group by the Board of Managing Directors. We were also consulted on decisions of fundamental importance, in good time. In 2013, the entire Supervisory Board once again concerned itself, in depth and on an ongoing basis, with developments on international transport markets – and in particular, with the persistently difficult market conditions in some segments of maritime shipping – as well as with the risk management for the various Transport Finance portfolios. Moreover, we advised the Board of Managing Directors with respect to the Bank’s strategic direction, the operative corporate planning derived therefrom, and its implementation. An additional focal point in the Supervisory Board’s work was the preparations for the implementation of the legal changes resulting from the mini- mum equity requirements and regulatory standards set out in the Basel III regime for banks and securities firms (the CRD IV package). Co-operation with the Board of Managing Directors As in previous years, the 2013 business year was once again characterised by numerous legal and regulatory changes. The Supervisory Board supported the Board of Managing Directors with the implementation of its strategic objectives, monitored compliance with all legal and regulatory provisions, and offered advice.
  19. 19. 15 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Report of the Supervisory Board Martin Wolfert Dr Peter Klaus Deputy Chairman of the Supervisory Board Prof Dr h.c. Stephan Götzl Wolfgang Köhler Frank Westhoff Chairman of the Supervisory Board Dr Klaus Nittinger Carl E. Steen Dorinus Legters Adnan Mohammed
  20. 20. 16 DVB Bank SE | Group Annual Report 2013 Report of the Supervisory Board On 13 June 2013, following the Bank’s General Meeting, a Supervisory Board meeting took place during which the newly- elected Supervisory Board member, Mr Carl Erik Steen, was elected as a member of the Credit Committee. Mr Steen suc- ceeded Mr Flemming Robert Jacobs, who retired from the Supervisory Board and the Credit Committee at the end of the General Meeting. The Supervisory Board also approved the schedule of responsibilities for the Board of Managing Directors, as updated on 1 July 2013. On that date, Mr Ralf Bedranowsky became Member of DVB Bank SE’s Board of Managing Directors. During the meeting on 30 September 2013, Mr Lunde, whose responsibilities included the Shipping Finance division, reported on recent developments in the Shipping Finance division, the current structure of the Shipping Finance portfolio, as well as on the risk situation in the various maritime shipping market seg- ments, based on up-to-date research documents. The Supervisory Board was then informed in detail about the new regulatory requirements. The Head of Group Compliance presented the 2013 Compliance Report. The last Supervisory Board meeting during the year under review took place on 21 November 2013. Besides the report of the Board of Managing Directors concerning DVB’s current business development, discussions focused on the Bank’s short- term and long-term strategic direction. In this context, we approved the planning for 2014, and discussed the medium-term planning until 2018 with the Board of Managing Directors. We resolved a capital increase for DVB Transport Finance Ltd, London (UK). The Heads of the Offshore Finance division and of the Strategic Management and Restructuring Team provided a detailed report on current business developments within their respective areas, and offered a forecast for the years ahead. We were also informed about the progress of the “Unity” project. We then concerned ourselves with the Bank’s operational implementation of the recommendations of the German Corpo- rate Governance Code. The Remuneration Committee, which the Bank has established on a voluntary basis (pursuant to section 6 of German Regulation on Remuneration in Financial Institutions) presented its annual report, which included an outlook on the impending changes to remuneration systems in 2014, as part of the CRD IV package. In this context, we also discussed the new regulations under the CRD IV Implementation Act, in detail, and the resulting future requirements for Supervisory Board members. This review triggered the following measures: • the establishment of a Remuneration Control Commitee, and of an Audit Committee; • changing the Executive Committee to the Nomination Committee; and • renaming the Credit Committee to the Credit and Risk Committee. markets, as well as on the specific risk situation concerning ships, aircraft and rolling stock on the respective transport markets. Changes to the regulatory environment constituted a major part of Supervisory Board discussion, whereby the CRD IV package as well as the amended Minimum Requirements for Risk Management were discussed in particular detail and with particular emphasis. Main issues during the meeting on 5 March 2013 were the key parameters of the 2012 consolidated financial statements, business development during the first months of 2013 as well as the consideration and confirmation of the single-entity financial statements of DVB Bank SE for the 2012 business year, which was also approved during this meeting. The external auditors, who took part in this meeting, responded to our questions in full. We duly noted and approved the dividend proposal for 2012, the Report of the Supervisory Board, and the Corporate Governance Report for 2012. The Board of Managing Directors then gave a detailed report on the Company’s personnel structure, and informed us about the progress of the audit concerning the Internal Capital Adequacy Assessment Process, conducted by the German Federal Financial Supervisory Authority. Mr Bertrand Grabowski, whose portfolio on the Board of Managing Directors also includes responsibility for Aviation Finance, provided a detailed report of current business developments – including the outlook for 2013 – and the risk situation in the aviation industry. At the meeting on 28 March 2013, we discussed the IFRS con- solidated financial statements 2012 with the auditors, and approved the consolidated financial statements. We adopted the proposals for resolutions to be passed by the Annual General Meeting 2013. The Head of Internal Audit presented his annual report, and we received extensive information on current pro- jects – especially concerning the “Unity” project which is being carried out in the years 2013 and 2014, to enhance efficiency in the Shipping Finance division. This was followed by an extensive exchange of views on the strategies for managing business, market, liquidity and equity investment risks, as well as on the outsourcing strategy contemplated by the Board of Managing Directors. This meeting also focused on various topics related to the Board of Managing Directors. We then discussed the assessment basis for variable remuneration for the Managing Directors for the business year 2013, and determined bonus payments to the Managing Directors for 2012, based on the recommendations put forward by the Executive Committee. We also approved the targets for payments under the DVB Long-Term Incentive Plan 2010. During this meeting, the Super- visory Board extended Mr Dagfinn Lunde’s appointment as a member of DVB Bank SE’s Board of Managing Directors until 31 December 2013 and also extended Mr Wolfgang F. Driese’s appointment as CEO and Chairman of DVB Bank SE’s Board of Managing Directors until 31 December 2014.
  21. 21. 17 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Report of the Supervisory Board All three resolutions were required to revise the scope of responsibility of these committees in line with the amended legal rules. Their specific scope of duties will be outlined by internal regulations which the Supervisory Board has yet to discuss and approve. There were no members of the Supervisory Board who attended less than half of meetings during the period under review. There were no conflicts of interest which would have required disclosure during the year under review. Supervisory Board Committees During its four meetings, the Credit Committee discussed and, where required, approved all credit exposures of DVB that were subject to reporting requirements by virtue of law or under the Internal Regulations, in detail and without delay. In addition, the Credit Committee was regularly involved in approving lending exposures, where such approval was required, by way of circu- lation. During the meetings, detailed portfolio analyses were used to discuss the structure of the loan portfolio and related planning as well as risk issues (specifically regarding credit, liquidity, country and market price risks). Of particular importance in this context were the performance of funded transport assets, risk management measures taken, and the specific analysis of individual non-performing exposures. In addition, the Committee members discussed and adopted various strategies for specific shipping sectors, as well as changes to existing Lending Policies. Discussions on the credit risk strategy formed a focal point of deliberations. The Committee discussed the impact of changed regulatory provisions on DVB and its subsidiaries in detail, together with the resulting changes to risk positions. Furthermore, Ernst Young GmbH Wirtschafts­ prüfungsgesellschaft, Stuttgart, informed the members of the Credit Committee of the results of an audit of the Bank’s lending business. The Board of Managing Directors kept the members of the Committee regularly informed about non-performing exposures and those subject to particular risks, and also about unusual events in the lending business. It informed the Commit- tee, without delay, about vessels or aircraft controlled by DVB. The Executive Committee met once during the reporting period. In addition to the duties which the Supervisory Board has con- ferred upon the Executive Committee, during 2013 the Committee discussed, in particular, the legal and regulatory requirements governing the remuneration of the Board of Managing Directors and the implementation of these requirements. The Committee prepared the discussion of these issues in the plenary meeting of the Supervisory Board, and dealt with general personnel matters pertaining to the Board of Managing Directors. Further- more, concerning the conclusion of employment contracts with executive staff, where the annual remuneration was in excess of a set threshold, the Committee was kept informed by the Board of Managing Directors as requested, and always in good time. The Chairman of the Credit Committee and the Executive Com- mittee kept the entire Supervisory Board informed on topics dealt with by the Committees, to the extent that such issues were fundamentally important, or were also discussed in the plenary meetings of the Supervisory Board. DVB’s Corporate Governance Implementation of the recommendations of the German Corpo- rate Governance Code was discussed in depth during the Super- visory Board meeting in November 2013. Together with the Board of Managing Directors, we have issued the twelfth Declaration of Compliance in accordance with section 161 of the German Public Limited Companies Act (referring to the German Corporate Governance Code as amended on 13 May 2013) which was published in the German Federal Gazette and on DVB’s website on 6 December 2013.  All Declarations of Compliance issued by DVB since 2002 are available for download from our website www.dvbbank.com Investors Corporate Governance Declarations of Compliance. Once again, we determined that, according to our own assess- ment, a sufficient number of independent members serve as Supervisory Board members. Dr Peter Klaus has assumed the role of an expert in finance within the Supervisory Board. Training and continuous professional development DVB continued to support us throughout 2013 with respect to training or continuous professional development measures, covering various typical areas, which we need to perform our duties as Supervisory Board members.
  22. 22. 18 DVB Bank SE | Group Annual Report 2013 Report of the Supervisory Board The Board of Managing Directors has prepared and submitted the mandatory report on business relationships with affiliated companies during the business year 2013; this report has been examined and certified without qualification by the external auditors, as follows: “Having duly examined and assessed this report in accordance with professional standards, we confirm that the report is free from factual misrepresentations, and that the company did not pay any excessive consideration with regard to the transactions identified in the report.” The Supervisory Board reviewed the mandatory report on relations with affiliated companies. In particular, the Supervisory Board has no objections regarding the declaration made by the Board of Managing Directors pursuant to section 312 (3) of the AktG. Frankfurt/Main, 27 March 2014 For the Supervisory Board Frank Westhoff Chairman Co-operation with external auditors for the 2013 financial statements The consolidated financial statements and the group management report of DVB Bank SE for the 2013 business year have been examined, following an audit of the accounting records, and certified without qualification, by Ernst Young AG, Wirtschafts­ prüfungsgesellschaft, Stuttgart, the external auditors appointed by the General Meeting. The Chairman of the Supervisory Board obtained information on the scope of the audit in advance, and discussed focal points with the auditors in detail. The auditors’ reports were distributed to all members of the Supervisory Board in good time before the meeting held on 27 March 2013, during which the consolidated financial statements were discussed. The auditors who certified the consolidated financial statements took part in this meeting. During this meeting, they gave a detailed account of their audit as a whole, and provided detailed answers to our questions regarding focal points of the audit. The subsequent examination by the Supervisory Board of the consolidated financial statements and group management report as at 31 December 2013, as presented by the Board of Managing Directors, gave no cause for objections. We thus approved the consolidated financial statements as at 31 Decem- ber 2013.
  23. 23. 19 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS The Supervisory Board (since 7 March 2014) Supervisory Board Shareholder representatives Frank Westhoff Chairman Member since 30 June 2006 Dr Peter Klaus Deputy Chairman Member since 10 June 2009 Prof Dr h.c. Stephan Götzl Member since 10 June 2009 Wolfgang Köhler Member since 21 September 2009 Dr Klaus Nittinger Member since 10 June 2009 Carl Eric Steen Member since 13 June 2013 Employee representatives Dorinus Legters Member since 4 November 2008 Adnan Mohammed Member since 13 February 2013 Martin Wolfert Member since 7 October 2008 Supervisory Board Committees Credit Risk Committee Frank Westhoff, Chairman Dr Peter Klaus Carl Erik Steen Martin Wolfert Nomination Committee Frank Westhoff Chairman Dr Peter Klaus Dorinus Legters Audit Committee Dr Peter Klaus Chairman Wolfgang Köhler Martin Wolfert Remuneration Control Committee Frank Westhoff Chairman Dr Peter Klaus Dorinus Legters
  24. 24. Corporate Governance Report 201320 DVB Bank SE | Group Annual Report 2013  The Corporate Governance Report 2013 in accordance with section 3.10 of the German Corporate Governance Code, the Corporate Governance Statement in accordance with section 289a of the HGB, the Declarations of Compliance, explanations concerning the Bank’s governance system, as well as the Memorandum and Articles of Association of DVB Bank SE, in their current version, are available on our website: www.dvbbank.com Investors Corporate Governance. DVB’s dual-board structure DVB Bank SE opted for a dual-board structure comprising two executive bodies, in addition to the General Meeting: one managing the Bank and its business (managing body: the Board of Managing Directors) and one supervising the management (supervisory body: the Supervisory Board). DVB’s dual-board structure is organised in the following manner:  The Board of Managing Directors – DVB’s managing body Pursuant to Article 7 of the Memorandum and Articles of Associ- ation of DVB Bank SE, the Board of Managing Directors consists of a minimum of two members who are appointed by the Super- visory Board for a period of no more than five years. During the year 2013, the Board of Managing Directors consisted of four members. Since 1 January 2014, it has been composed of three members. In the following declaration pursuant to section 3.10 of the German Corporate Governance Code (the Code) and section 289a (1) of the German Commercial Code (HGB), the Board of Managing Directors and Super- visory Board of DVB Bank SE report on the Bank’s corporate governance. DVB is a leading global specialist in international transport finance. As a listed company, DVB must observe the recommen- dations and proposals of the Code. The Board of Managing Directors and the Supervisory Board therefore use the Code as a guideline on how to enhance the transparency of business decisions for shareholders, business partners, employees, and the general public. The two Boards review the Code’s recommen- dations – as amended by the Government Commission of the German Corporate Governance Code, and how DVB is implement- ing them, on an annual basis. DVB’s corporate governance is shaped by four essential parameters: • responsible and effective corporate governance and control by the Board of Managing Directors and the Supervisory Board, respectively; • protecting the interests of stakeholder groups such as shareholders, investors, clients, business partners and staff; • regular financial reporting and independent audits; and • transparent communications. Dual-board structure Board of Managing Directors  Management body  Corporate strategy  Controlling  Risk Management  Compliance  Preparation of the financial statements and management reports reports to  formally approves of   close co-operation to the benefit of the enterprise  reports to   advises, approves, controls, appoints, dismisses Supervisory Board  Supervising body  Examination, confirmation/approval of financial statements and resolutions  Members: six shareholder representatives three employee representatives  Credit Committee, Executive Committee1)  Four scheduled meetings a year reports to  formally approves of  General Meeting  Each share carries one vote.  Resolutions on e.g. the profit appropriation, changes of the Memorandum and Articles of Association as well as legal transactions requiring approval  Appointment of the shareholder representatives on the Supervisory Board and of the auditor 1) As at 31 December 2013; please refer to page 19 for committees as at 7 March 2014 
  25. 25. Corporate Governance Report 2013 21 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS The Supervisory Board selects those candidates for appointment as members of the Board of Managing Directors who are most suitable in the context of the Bank’s business model: specific expertise in the transport finance business is decisive, whereas criteria such as gender or nationality are less relevant for the sustainable promotion of the Bank’s business model (section 5.1.2 (1) sentence 2 of the Code). Reappointments, for no more than five years per term, are per- mitted. In principle, the term of office of a member of the Board of Managing Directors ends when reaching the age of 65. In exceptional cases, this term of office may be extended twice, by one year each. The Board of Managing Directors manages the business in the Company’s best interests, and in order to achieve a sustained increase in its value. In doing so, the Board of Managing Directors considers the interests of shareholders, investors, clients, and business partners as well as those of the Bank’s employees. DVB’s business model and its strategic position in the relevant global transport markets is determined and refined by the Board of Managing Directors in co-ordination with the Supervisory Board. In addition, the members of the Board of Managing Directors ensure that the Company is managed in accordance with legal regulations, the Memorandum and Articles of Asso- ciation, and the Internal Regulations. Moreover, the Board of Managing Directors directs the parent company – DVB Bank SE – and the DVB Group, using efficient management tools. Specifi- cally, these include financial controlling, risk management and compliance. Regarding the members of the Board of Managing Directors, no conflicts of interest pursuant to section 4.3 of the Code occurred during the 2013 business year. More information on the composition of the Board of Managing Directors and the distribution of responsibilities amongst its members is available on page 13 of this annual report. The Supervisory Board – DVB’s supervisory body Pursuant to Article 11 (1) of the Memorandum and Articles of Association of DVB Bank SE, the Supervisory Board consists of a total of nine members, comprising six shareholder representa- tives and three employee representatives. The current members of the Supervisory Board are appointed for the period until the conclusion of the General Meeting that passes a resolution on the formal approval for the fourth financial year following the commencement of their term of office (section 11 (2) of the Memorandum and Articles of Association). This will be the Annual General Meeting to be held in 2014. Reappointments are permissible. In accordance with section 5.4.3 of the Code, starting with the Annual General Meeting 2014, Supervisory Board elections will be conducted individually for each member. Within the scope of proposals for election to be submitted to the Annual General Meeting, DVB will disclose each candidate’s personal or business relations with DVB, its executive bodies, or a major shareholder in DVB, as well as proposals for election to the function of Chairman of the Supervisory Board. With regard to the election of Supervisory Board members it shall be ensured in principle that any such candidate will not attain the age of 68 years during their term of office as a Member of the Supervisory Board. In special cases, however, this threshold may be exceeded by two years. Former members of the Board of Managing Directors may only be elected to the Supervisory Board after a period of two years has elapsed since their retire- ment from the Board of Managing Directors, unless their election is proposed by a shareholder holding a stake exceeding 25% of the voting rights of DVB Bank SE. The Supervisory Board continually advises and supervises the Board of Managing Directors in its management of the business. It is involved in every major business decision. Transactions that require Supervisory Board approval, pursuant to Article 18 of the Memorandum and Articles of Association, include the purchase and sale of companies, the conclusion of intercompany agree- ments and the development of new (or the discontinuation of existing) business segments, to the extent that the relevant measure has material importance for DVB Group. In addition, the Supervisory Board is responsible for the appointment and removal of members of the Board of Managing Directors. The Supervisory Board conducts its business in accordance with its Internal Regulations. It is directed by the Chairman of the Supervisory Board, who sets the agenda for each meeting, chairs the plenary meetings, and signs the meeting minutes. The Internal Regulations of the Supervisory Board also provide for various methods of casting votes; for each poll, the Chairman of the Supervisory Board selects the most appropriate method from amongst these options. During 2013, the Supervisory Board formed two committees, the Executive Committee and the Credit Committee. • The Executive Committee consists of three Supervisory Board members, including the Chairman and Deputy Chairman of the Supervisory Board, plus an employee representative. The Committee’s tasks are defined in its Internal Regulations. The Executive Committee is responsible for preparing resolutions on the conclusion, extension or termination of contracts with members of the Board of Managing Directors, and regarding their remuneration. The resolutions are passed by the plenary meeting of the Supervisory Board.
  26. 26. Corporate Governance Report 201322 DVB Bank SE | Group Annual Report 2013 • In future, the Nomination Committee will concern itself, among other tasks, with identifying candidates for appointment to the Board of Managing Directors, and for the election of shareholder representatives to the Supervisory Board. • Some of the tasks performed by the Executive Committee to date will be transferred to the Remuneration Control Commitee, and to the Nomination Committee, respectively. • No committee has been established for preparing of Super­ visory Board meetings. Preparations for these meetings – in terms of topics and organisation – take place in direct com- munication between the Chairman of the Supervisory Board and the Board of Managing Directors. The Bank intends to adhere to this well-established practice in the future. Communications between the managing body and the super­ visory body are generally structured as follows: between sched- uled Supervisory Board meetings, the Chairman of the Board of Managing Directors informs the Chairman of the Supervisory Board – regularly, without delay and always up to date – on the Bank’s strategy, planning and business development, on risk management and the Bank’s risk situation, compliance, as well as on important decisions to be made, and on significant issues. During its meetings, the supervisory body is kept informed, regularly and comprehensively, on developments of strategic parameters pertaining to DVB’s business model, resulting adjustments to future business policy, as well as on corporate governance and planning (including financial planning, compris- ing the planning of DVB’s financial position and financial perfor- mance, and human resources planning). Going forward, this communication will be expanded further by providing the members of the committees yet to be established with more detailed information. Moreover, the Internal Regulations of the Supervisory Board provide for an examination of efficiency, to be performed regu- larly, where the members of the Supervisory Board critically evaluate their own work. For further information, please refer to the Report of the Supervisory Board (on pages 14 – 18 of this annual report), which also gives a detailed description of the work of the Supervisory Board and the focal issues discussed during 2013, as well as the processes of communication and co- ordination between the Board of Managing Directors and the Supervisory Board. The current composition of the Super- visory Board, and of its committees, is shown on page 19 of this annual report. • The four members of the Credit Committee are elected from amongst the members of the Supervisory Board by the plenary meeting. They meet at least four times per year. Moreover, the Credit Committee also passes resolutions or holds polls by way of circulation; where appropriate, Committee members communicate via conference calls. The Supervisory Board has delegated authority to the Credit Committee, within the scope of specific Internal Regulations, for certain decisions to be taken on behalf of the Supervisory Board. Specifically, this includes dealing with all DVB Group exposures which must be submitted to the Supervisory Board for acknowledge- ment or approval, as well as all major loans and loans subject to higher risks. Where required, the Credit Committee approves any such loans. Moreover, the Board of Managing Directors co-ordinates the lending policies with the Credit Committee, and keeps the Committee informed on a regular basis about problem loans, exposures subject to higher risk, and unusual events related to the lending business. In its meeting on 21 November 2013, the Supervisory Board resolved to establish a Credit and Risk Committee, an Audit Committee, a Remuneration Control Commitee and a Nomina- tion Committee in the first quarter of 2014. These committees will assume the duties incumbent upon them by virtue of the law, as well as additional tasks in order to reduce the workload of the Supervisory Board. • The tasks of the Credit and Risk Committee include advising the Supervisory Board on topics such as the Company’s overall propensity to accept risk, and on its risk strategy. The Committee also supports the Company with the related implementation. The Credit and Risk Committee discusses the incentives provided for in the remuneration system, and reviews whether these incentives take the structure of DVB’s risk, capital and liquidity into account. Furthermore, the Committee will assume the tasks hitherto performed by the Credit Committee. • The Audit Committee will support the Supervisory Board particularly with regard to monitoring the accounting and financial reporting process, the effectiveness of the risk management system, and in carrying out the audits of the financial statements. • The specific tasks of the Remuneration Control Commitee will comprise monitoring whether remuneration systems for the Board of Managing Directors and for the Bank’s employees are appropriate; the Committee will support the Board of Managing Directors in determining the specifications of such remuneration systems. Furthermore, the Remuneration Con- trol Commitee prepares the Supervisory Board’s resolutions concerning the remuneration for members of the Board of Managing Directors.
  27. 27. Corporate Governance Report 2013 23 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Remuneration report Total expenses for the remuneration of the Board of Managing Directors, former members of the Board of Managing Directors and their surviving dependants as well as the Supervisory Board amounted to €3.8 million (2012: €2.8 million). The remuneration chapter – which forms part of the group management report (pages 142 – 143) – outlines the main legal features of DVB’s remuneration system, whilst this Corpo- rate Governance Report contains a detailed breakdown and explanation of remuneration for the members of the Board of Managing Directors and of the Supervisory Board. Remuneration of the Board of Managing Directors The HGB requires companies to disclose personalised remuner- ation (and remuneration components) of members of the Board of Managing Directors in the financial statements and consoli- dated financial statements. Pursuant to sections 286 (5) and 314 (2) sentence 2 of the HGB, a company may waive such per- sonalised disclosure of executive remuneration if the General Meeting adopts a resolution to that effect, with a qualified majority vote of no less than three-quarters of the share capital represented during the passing of the relevant resolution. By virtue of a resolution passed by the Annual General Meeting held on 9 June 2011 (agenda item no. 5), with the requisite majority of the share capital represented, DVB Bank SE has opted to waive the personalised disclosure of remuneration paid to members of the Board of Managing Directors for a period of five years. The Supervisory Board has determined the structure of remu- neration for the Board of Managing Directors. In 2013, the total remuneration of the Board of Managing Directors was comprised of a fixed component of 55.9% and a variable bonus of 44.1% (2012: 70.5% fixed/29.5% variable component).  Fixed remuneration component The fixed remuneration component of DVB Bank SE’s Board of Managing Directors comprises monetary remuneration compo- nents, pension commitments and special benefits. In 2013, it totalled €1,765,464.97 for four members of the Board of Managing Directors (previous year: €1,520,585.10 for three members of the Board of Managing Directors). Variable remuneration component The variable remuneration component of DVB Bank SE’s Board of Managing Directors comprises a cash bonus, and potentially a bonus under DVB’s Long-Term Incentive Plan (LTI). In 2013, the Board of Managing Directors received payments of variable remuneration in the amount of €1,392,389.23 (previous year: €635,199.00). The increase in variable remuneration, compared with the previous year, was attributable to the following factors: • In 2013, bonuses paid to members of the Board of Managing Directors related to the three years 2010 to 2012 (in 2012, bonuses were paid for two years: 2010 and 2011). • In 2013, bonuses were paid from the LTI to members of the Board of Managing Directors for the years 2009 and 2010 (in 2012, LTI bonuses were paid for the year 2009).  Remuneration of the Board of Managing Directors – fixed and variable components (€) 2013 2012 % Monetary compensation elements 1,157,500.00 995,000.00 16.3 Pension commitments including contributions to pension provisions 373,459.49 334,842.26 11.5 Special benefits 234,505.48 190,742.84 22.9 thereof allowances for company car or monetary equivalent 64,545.94 56,152.26 14.9 thereof rent subsidies 38,987.06 38,804.58 0.5 thereof insurance cover and employer contributions to foreign social security schemes 130,972.48 95,786.00 36.7 Fixed remuneration component 1,765,464.97 1,520,585.10 16.1 Variable remuneration component 1,392,389.23 635,199.00 – Total portfolio 3,157,854.20 2,155,784.10 46.5
  28. 28. Corporate Governance Report 201324 DVB Bank SE | Group Annual Report 2013 such as economic value added and consolidated net income before taxes) as well as to the personal performance of each individual member of the Board of Managing Directors. The amount of the bonus depends on the (measurable) extent to which the targets were achieved. The cash bonus for the business year 2013 will be awarded in four tranches: 50% during 2014, and three tranches of 16.66% each, awarded during the following business years 2015 to 2017. Payment of these future tranches is conditional upon allowance for credit losses not exceeding a certain threshold during the year prior to disbursement. Moreover, all four bonus tranches are restricted to the effect that 50% of each tranche is subject to an additional one-year retention period. This means that these parts will not be disbursed imme- diately. During the retention period, the value of the retained amounts will be replaced by a remuneration instrument linked to the Bank’s performance. The prerequisite for payment of the two variable remuneration components is, in each case, that no notice of termination has been given with regard to the employment relationship with the Board member concerned as at the time of payment. The sole exception would be where the Board member retires from office for reasons of age, or due to non-renewal of a contract. Further details with regard to the general principles governing the variable remuneration components for the Board of Managing Directors are provided below: Target bonuses are awarded each year under the respective LTI (LTI Target Awards). The prerequisite for a payment under these awards is that the planned performance of the Company is in fact achieved in the respective target years. This performance goal is measured on the basis of a predefined economic value- added figure and the consolidated net income before taxes. The Supervisory Board may increase the payment under the LTI Target Award above the target amount in case actual company performance exceeds the targeted performance goal. 50% of LTI bonuses are disbursed during the year following the respective target year, with the remaining 50% of each premium subject to a one-year retention period. During the retention period, the value of the retained bonus will be replaced by a remuneration instrument linked to the Bank’s performance. The cash bonus payments paid to members of the Board of Managing Directors are determined on the basis of agreements on operational targets. These objectives, which are agreed upon between the Supervisory Board and the respective member of the Board of Managing Directors, are related to objective criteria for the relevant financial year (referring to financial indicators
  29. 29. Corporate Governance Report 2013 25 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Remuneration of the Supervisory Board The annual remuneration of Supervisory Board members is gov- erned in Article 19 (1) and (2) of DVB Bank SE’s Memorandum and Articles of Association. The members of the Supervisory Board receive €20,000.00, the Chairman of the Supervisory Board receives €30,000.00, and the members of the Credit Com- mittee receive an additional €10,000.00 each. The remuneration is paid on the 1 July of each year. Where said remuneration is subject to value-added tax, this tax shall be paid in addition to the remuneration (Article 19 (3) of the Memorandum and Articles of Association). Further details, such as the reimbursement of travelling expenses and other cash expenses, daily allowances and similar issues, are governed by Article 19 (4) of the Memo- randum and Articles of Association. Total remuneration expenses paid in 2013 by DVB Bank SE for members of the supervisory bodies amounted to €272,146.40 (previous year: €273,700.00). Taxes amounting to €34,793.75 (previous year: €35,455.00) were transferred directly to the tax authorities for the Supervisory Board members domiciled abroad. The members of the Supervisory Board therefore received remu- neration of €237,352.65 (previous year: €238,245.00) for their actions as Supervisory Board and Credit Committee members.  Shareholdings of the Board of Managing Directors and the Supervisory Board As at 31 December 2013, the Board of Managing Directors and the Supervisory Board did not hold, in aggregate, more than 1% of the shares issued by DVB Bank SE.  Remuneration of the Supervisory Board 2013 (€) Supervisory Board remuneration Credit Committee remuneration Value- added tax 19% Total Shareholder representatives: Frank Westhoff, Chairman 30,000.00 10,000.00 7,600.00 47,600.00 Dr Peter Klaus, Deputy Chairman 20,000.00 10,000.00 5,700.00 35,700.00 Dr h.c. Stephan Götzl 20,000.00 – 3,800.00 23,800.00 Flemming Robert Jacobs, resident in the UK (until 13 June 2013) 9,055.56 4,527.78 2,580.84 16,164.18 Wolfgang Köhler 20,000.00 – 3,800.00 23,800.00 Dr Klaus Nittinger 20,000.00 – 3,800.00 23,800.00 Carl Erik Steen, resident in Norway (from 13 June 2013) 11,000.00 5,500.00 3,135.00 19,635.00 Employee representatives: Masahide Kubo, resident in the UK (until 16 January 2013) 944.44 – 179.44 1,123.88 Dorinus Legters, resident in the Netherlands 20,000.00 – 3,800.00 23,800.00 Adnan Mohammed, resident in the UK (from 13 February 2013) 17,666.67 – 3,356.67 21,023.34 Martin Wolfert 20,000.00 10,000.00 5,700.00 35,700.00 Total remuneration 188,666.67 40,027.78 43,451.95 272,146.40 Tax deduction for Supervisory Board members resident outside Germany (paid directly to the responsible tax office): VAT 19% 13,051.95 Taxes for membership in a supervisory board 30% 20,608.34 Solidarity surcharge 5.5% 1,133.46 Total tax deductions 34,793.75 Remuneration less tax deductions for Supervisory Board members resident outside Germany 237,352.65
  30. 30. Corporate Governance Report 201326 DVB Bank SE | Group Annual Report 2013 Regular financial reporting and independent audits Financial reports provide shareholders and the general public with regular information about DVB’s financial position and per- formance. DVB publishes two annual reports for each concluded business year. The annual report of DVB Bank SE comprises the Bank’s financial statements in accordance with the HGB, whilst DVB Bank Group’s annual report contains its IFRS consolidated financial statements. Both sets of financial statements are pre- pared by the Board of Managing Directors. They are subjected to a review by the independent external auditors appointed at the Annual General Meeting before being confirmed (single-entity financial statements) by, or receiving final approval (consolidated financial statements) from the Supervisory Board. The single-entity report of DVB Bank SE is only published on the Bank’s website in German. The Group Annual Report is available for download from DVB’s website in both English and German.  These reports are expected to be available on DVB’s web- site www.dvbbank.com under Investors Publications Financial reports at the end of March/beginning of April 2014. During the year, DVB also publishes a half-yearly financial report that includes condensed consolidated financial statements and interim management statements during the first and second half of the year, covering key financial data for the first three months and nine months of the business year, respectively. All these financial reports are prepared according to IFRS. The Annual General Meeting on 13 June 2013 appointed Ernst Young GmbH Wirtschaftsprüfungsgesellschaft, Stuttgart, as auditors for the 2013 business year. Their mandate covers the audit of the single-entity financial statements and the consoli- dated financial statements prepared by DVB for the 2013 business year, as well as any review of the condensed financial statements and the interim management report (pursuant to sections 37w (5) and 37y no. 2 of the German Securities Trading Act (WpHG)) as at 30 June 2013; and of the interim consolidated financial state- ments (pursuant to section 340i (4) of the HGB) prepared prior to the Ordinary Annual General Meeting held in 2014. General Meeting – protecting shareholders’ interests DVB’s shareholders exercise their rights prior to or during the General Meeting, as provided by law or in the Memorandum and Articles of Association. The Ordinary Annual General Meeting of DVB Bank SE takes place during the first six months after the end of each financial year (Article 21 of the Memorandum and Articles of Association). Shareholders’ regular duties include accepting the financial statements confirmed by the Supervisory Board and the consolidated financial statements approved by the Supervisory Board; passing resolutions on the appropriation of distributable profit, on the formal approval of the members of the Board of Managing Directors and the Supervisory Board, and on the appointment of the external auditors. The invitation to the General Meeting of DVB Bank SE, including the agenda, is published in the German Federal Gazette. It is additionally sent to shareholders via their custodian banks. More- over, the convening notice and agenda can easily be accessed via the Bank’s website as soon as the General Meeting has been convened. For easy reference, a summary agenda is also provided there.  www.dvbbank.com Investors General Meeting The website also contains information on shareholder rights pursuant to sections 122 (2), 126 (1), 127, 131 (1) of the German Public Limited Companies Act (AktG). The Bank offers the addi- tional service of allowing shareholders to appoint one of the proxies named by DVB to exercise their voting rights at the General Meeting. Pursuant to section 134 (3) sentence 4 of the AktG, DVB provides a proxy form which can be used for electronic transmission of a proxy by fax or e-mail. The Company’s Memorandum and Articles of Association do not currently provide for the casting of votes by post. More information on the topics discussed during the Annual General Meeting 2013 is available in the chapter “Equity markets and the DVB share” on page 38 of this annual report.
  31. 31. Corporate Governance Report 2013 27 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Transparent communications The Bank regularly publishes information relevant to shareholders and the general public, in addition to its annual reports. • DVB published an ad-hoc disclosure regarding the Bank’s preliminary and unaudited consolidated financial statements 2012 on 7 March 2013. • The Bank published two Directors’ Dealings notices on 14 August 2013.  We have placed a link on DVB’s website www.dvbbank.com Investors Publications Directors’ Dealings, referring to the Company Centre of our service provider Deutsche Gesellschaft für Ad-hoc Publizität. • As a listed public company, DVB Bank SE is obliged to issue an annual Declaration of Compliance, in which the Board of Managing Directors and the Supervisory Board provide details on their compliance with the recommendations of the Code, and give reasons for any deviations. DVB published its twelfth Declaration of Compliance on 6 December 2013. The declara- tion covers the years 2013 and 2014, and is available on the Bank’s website.  All Declarations of Compliance issued by DVB since 2002 are available for download from its website www.dvbbank.com Investors Corporate Governance Declaration of Compliance. • DVB actively uses the internet for all relevant publications to ensure that information is provided to shareholders and the public in a timely, concurrent and comprehensive manner. The Bank’s website is the point of contact frequently used by interested financial markets participants. It is continuously adapted to the growing needs of DVB’s stakeholders. Accord- ingly, DVB re-launched the site in 2013, with a marked expansion in the scope of information provided on the Bank and its business divisions. The relaunched website went online in November 2013, offering an attractive new design, user-friendly navigation and many new features which now also facilitate mobile use of the site. • DVB compiles the scheduled dates of material recurring events and publications in the financial calendar, which is published on the Bank’s website in good time, and is permanently made available there. This allows all those interested to be informed without undue delay.  All relevant dates and events for the 2014 business year are published on www.dvbbank.com Investors ­Financial calendar. • Since 2008, DVB has also provided a dedicated information service: the Bank‘s Investor Relations newsletter, “Perfor- mance”. This is designed to actively relay target group-specific information about DVB’s performance and its business divisions. • The Bank uses the social media communications channels Twitter (short messages), YouTube (video clips) and Slideshare (presentations and reports) as a targeted means to bring DVB’s communications products close to its stakeholders, and to encourage interaction with them.  DVB’s website www.dvbbank.com Media Social media provides a transparent overview of the Bank’s social media activities. • Within the scope of both regular and ad-hoc events – includ- ing the Annual General Meeting, the Annual Accounts Press and Analyst Conference, as well as follow-up rating discus- sions, road shows and one-on-one meetings – DVB maintains a continuous, direct and intensive dialogue with shareholders, rating and bank analysts, and the financial jounalists.
  32. 32. Corporate Governance Report 201328 DVB Bank SE | Group Annual Report 2013 Risk management DVB’s Board of Managing Directors has established an adequate and viable risk management system that fulfils the Bank’s own commercial needs and complies with legal requirements. With the methods, models, organisational rules and IT systems imple- mented, DVB is able to recognise material risks at an early stage, and to respond appropriately by taking suitable measures. The suitability and effectiveness of DVB’s risk management system are regularly reviewed by internal and external auditors. DVB operates a Group-wide risk management system, which complies with all statutory and regulatory requirements. This risk management system comprises adequate provisions and measures with respect to risk strategy, risk-bearing capacity, risk management, and risk monitoring, plus a multi-level frame- work for the early detection of risks. In addition to the structural and procedural organisation, these measures also apply to the processes for identifying, assessing, managing, monitoring and communicating the risks. DVB’s (narrowly-defined) risk management system distinguishes between operative and strategic risk management. The Bank defines operative risk management as the implementation of the risk strategy by the various business divisions, as prescribed by the Board of Managing Directors. In addition to defining risk policy guidelines, strategic risk management also co-ordinates and supports operative risk management processes by cross- divisional committees. The risk control function – which is independent from risk man- agement in the narrower sense – comprises the identification, quantification, limitation and monitoring of risks, plus risk reporting. A differentiated and sophisticated DVB Group Risk Report is submitted to the entire Board of Managing Directors and the Supervisory Board on a quarterly basis, informing the two Boards about the Group’s risk exposure. Furthermore, DVB has installed reporting systems for all relevant types of risk. This ensures that the risks are transparent at all times to the authorised persons with responsibility for those risks. For more details regarding risk management, please refer to the report on opportunities and risks on pages 152 – 175 of this annual report. Management tools The key tools employed to manage the business are financial controlling, the risk management system, and the compliance function. Financial controlling The Board of Managing Directors has an extensive set of controls at its disposal: it uses them for value-driven and integrated overall management of the Bank – taking into account both income and risk parameters. From an ex-ante point of view, the key task is to distinguish beneficial options from disadvantageous ones – with a focus on the transparent and consistent design of target systems, alternatives, and forecasts. Ex-post analyses, in contrast, are carried out within the framework of a systematic cycle of planning, management and control. This means identi- fying concrete measures and management options that are specifically designed to meet the requirements of the respective management areas. The information gained through analysing risk-adjusted profit- ability provides transparency regarding the value created throughout the Group, and in the various units managed. The metrics used internally to assess the performance of each unit are economic value added (EVA)™ and return on risk-adjusted capital (RORAC). Both indicators measure the performance generated on the risk capital invested. Risk-adjusted profitability data is a key input factor for allocating capital and resources within the enterprise. All of DVB’s divisions and areas are covered by a uniform value- driven management system. Besides income, risk is another key dimension of all ex-ante and ex-post analyses. In essence, the Group’s focus is on achieving defined income and cost targets, whilst maintaining its risk-bearing capacity and ensuring compliance with regulatory requirements. In addition to the strategic plan and a detailed one-year plan, the standard- ised toolbox also provides for regular projections of full-year results carried out over the course of the year. The periodic management information system is built on top of an integrated data warehouse, with ad-hoc studies and analyses used as required. DVB’s tools for measuring risk-adjusted profitability are also integrated in the “Integrated risk and capital management system used throughout the DZ BANK Group”.
  33. 33. Corporate Governance Report 2013 29 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Compliance DVB defines compliance as adherence to the law and the Com- pany’s Memorandum and Articles of Association, as well as compliance with internal rules and regulations and voluntary obligations. The Compliance Office has been mandated by the Board of Managing Directors to ensure that regulatory compli- ance is implemented throughout the Group. Thus, the scope of the function includes – but is not limited to – money laundering prevention, prevention of market abuse or market manipulation, data protection, conflicts of interest, anti-corruption, and com- pliance with the Markets in Financial Instruments Directive. In accordance with section 33 (1) sentence 2 no. 5 of the WpHG, the Head of Compliance submits a Compliance Report to the Board of Managing Directors and the Supervisory Board, at least once a year. This report complies with the requirements pursuant to sections 31 et seq. of the WpHG and of the MaComp (Minimum Requirements for the Compliance Function and Addi- tional Requirements Governing Rules of Conduct, Organisation and Transparency pursuant to sections 31 et seq. of the WpHG). Sustainable conduct – both commercially and socially – is a key element of DVB’s corporate culture. To ensure a professional, uniform and exemplary standard of conduct throughout the Group, the Board of Managing Directors developed a Code of Conduct at the beginning of 2010. The values enshrined in this Code of Conduct must be observed vis-à-vis our clients and business partners as well as all fellow employees. The Code of Conduct outlines DVB’s mission statement based on four core values: • We offer our clients professional expertise on transport mar- kets and transport assets – throughout all market cycles. • We support our clients around the world with tailor-made financing solutions and services. Our products meet all relevant legal and ethical standards. • Entrepreneurial vision and strength guides our every thought and action. • We create a working environment for all DVB staff that promotes expertise, creativity, dedication, teamwork and variety. In this way, the Code of Conduct is also designed to manage ethical and legal challenges arising during day-to-day work, providing guidance in the event of any conflicts.  The Code of Conduct is available on www.dvbbank.com, via the footer in the lower part of the page (in the Compliance section). Compliance staff have been appointed in each of the Bank’s locations, directly reporting in this capacity to the Head of Com- pliance. Where possible, automated monitoring systems have been implemented, which ensure that any potential breaches are automatically alerted to the central function in Frankfurt/ Main. The local Compliance Officers must additionally escalate any potential breach of internal policies/procedures as well as external rules and regulations. All staff attend regular trainings on compliance-related topics. DVB has partnered with an external provider to conduct web- based training sessions. Specifically, mandatory webinars were carried out focused on money laundering prevention, operational risk, data protection and security, conflicts of interest, and the Code of Conduct. In addition, the Bank has conducted regional follow-up group trainings on anti-money laundering and anti- corruption measures where it uses a training video covering the topics, provided information concerning special regional require- ments, and offered the opportunity to discuss the key learnings.
  34. 34. 30 DVB Bank SE | Group Annual Report 2013 Our employees Our human resources work focused on three main areas during 2013. Thanks to largely stable staffing levels, one focal area was the integration of employees who joined DVB since 2012, as well as those colleagues who moved locations within DVB. Another key aspect of our work was to support managers in promoting staff within their area of responsibility, and to enhance their qualification. Finally, a new element was to support the conception of the “Unity” programme (for more details, please refer to page 44 – 45 of this report). Development of the personnel structure in 2013 After staff levels had risen only marginally during 2012 – by ten employees or 1.8% – 2013 saw another small increase in the number of active employees, by nine (+1.6%) to 567 staff.  This figure does not reflect the seven employees with inactive employment relationships, such as the non-working phase of semi-retirement, maternity or parental leave. The staffing numbers for the years 2009–2013 shown here also include employees of the LogPay Financial Services GmbH subsidiary, but no longer include the employees of TES Aviation Group. Rising staff numbers over recent years were largely due to a significant increase in workload, in response to greater legal and regulatory requirements that had to be absorbed by additional staff. This trend prevailed during 2013, affecting staffing levels in the service areas in particular: at 213 employees, the number was 7.0% higher than in the previous year (year-end 2012: 199 employees). Hence, the increase in staff numbers in 2013 was fully attributable to these units – and it is fair to expect this trend to continue for another one or two years. For detailed statistical information about our employees, please refer to the chapter “Non-financial performance indicators/sustainability” in the management report, on pages 144 – 150 of this report. Staff levels 2009 – 2013 600 500 400 300 200 100 0 10 505 2009 5 508 2010 7 548 2011 9 558 2012 7 567 2013 Staff members in the active phase of employment Staff members in the passive phase of employment Number of staff members 
  35. 35. 31 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Our employees Personnel development DVB’s business environment constantly gives rise to new and complex issues that our organisation has to deal with. The goal of human resources development is to equip managers and staff with the skills to deal with these challenges. Annual employee reviews are one of our key development instruments: they provide a platform for open dialogue between manager and employee, regarding the employee’s skills, exper- tise and potential for development. For this purpose, Group Human Resources (GHR) provides managers with a discussion guideline that is deliberately kept lean. The guideline serves as an orientation for structuring the discussion, leaving scope for further discussion issues. Development measures planned for the employee are noted in the guideline, and are implemented by manager and employee, with support provided by GHR. The range of development measures is wide – including, for instance, learning form colleagues, learning from feedback, or participation in internal and external training courses. We have been conducting in-house presentation skills trainings at various DVB locations. During 2013, we have been evaluating additional internal training topics, such as negotiation techniques and project management, in order to provide staff and managers with targeted tools and techniques, to help them in their day-to-day work. Besides the employee review, the determination of the bonus has been deliberately set up as a separate process. Determining bonuses is based on achieving explicit quantitative or qualitative targets that have been mutually agreed upon by employees and their managers. We have been conducting our trainee programme successfully for many years. The roughly 18-month programme covers all the major aspects of our Transport Finance business, including relationship management and loan management. The financial and global economic crisis made stable and definitive human resources planning challenging, which resulted in lower trainee appointments. We are, however, still recruiting candidates for the programme. Regardless of rising staffing levels in the service areas, these employees continue to account for just over one-third of DVB’s overall staff base; this is consistent with our long-term target of having two-thirds of our workforce employed in market-facing units, with the remaining one-third in service teams.  Recruitment To fill open positions, we first look for experienced specialists, be it for Transport Finance or for one of our service areas. Accordingly, we generally recruit personnel with the help of recruitment consultants. Fortunately, we have increasingly been able to fill positions through referrals from our own employees, or through unsolicited applications. No recruitment measures are necessary for our trainee programme, as there are plenty of qualified candidates who apply directly. DVB’s focus on diversity is also reflected in our recruitment activities: to the extent possible within the scope of staff selec- tion, we strive to promote a heterogeneous personnel structure at all of DVB’s office locations, in terms of nationality, age and gender. Transport Finance/Investment Management 302 (–3 staff) Service areas 213 (+14 staff) LogPay Financial Services 52 (–2 staff) Distribution of 567 employees by business division
  36. 36. 32 DVB Bank SE | Group Annual Report 2013 Our employees Leadership and management DVB’s characteristically dynamic approach is embedded in our concept of leadership. Our executive staff need to respond and decide quickly and flexibly. DVB’s flat hierarchical structure helps decision-makers to respond quickly, precisely and in a targeted manner, even to complex issues or transactions. Managers, as well as the members of the Board of Managing Directors, are also always accessible under our open-door policy in order to engender internal transparency and an open exchange. Being receptive to new ideas and challenging of opinions is at the heart of our concept of management. In an enterprise with a manageable number of employees such as DVB, we believe it is more productive to promote a personal approach, offering a high degree of autonomy rather than a top-down management style. Given this background, employee management, training and development are not administered centrally, and instead are primarily the responsibility of managers. GHR also provides support. In concrete terms, this means that we are supporting our man- agers with hands-on tools to analyse the need for development, to structure employee review discussions, as well as with training proposals and customised advice. Executive development DVB conducted a Management Survey amongst all its Senior Vice Presidents and Managing Directors in 2011. The results of this survey showed that the ongoing professional development of management staff is a key aspect of our human resources work. For instance, those surveyed expressed their desire for pro­ active Human Resources development and for new development perspectives, including outside traditional careers. Our aim is not to centralise the work that managers are responsible for in overseeing, training and developing employees, but rather to better equip those managers for their management duties. That is why we developed a training package for managers, to enable them to deploy our development tools in a targeted manner. Encompassing all executive staff below the Board of Managing Directors, the course took place during the first half of 2013, in co-operation with an international business school. The course, which covered several days, focused on the follow- ing core topics, and on ways and means to implement them in practice: • giving and receiving feedback; • discovering talents and promoting them; • coaching employees; • working on one’s own career development. Based on positive feedback from participants, and with the sup- port from the Board of Managing Directors, we embarked upon expanding this initiative to the next management level. Training courses for this target group are scheduled to take place in early 2014. We believe that developing a culture of feedback also means giving managers sufficient time for discussions and an exchange of views with their staff. In the context of the training courses conducted in early 2013 – backed by numerous discussions, as well as in view of current workplace trends – we have identified management efficiency as another topic for our executive development. Joining forces with an international business school, we con- ceived a corresponding training programme that will focus on efficiency, from a variety of angles and in different workplace settings – dealing with employees, meetings, self-management, etc. We presented this topic to managerial staff by way of a keynote address. The first training courses are set to take place in early 2014, based on guidelines set by our Board of Managing Directors for efficient co-operation between the Board and managerial staff. These guidelines will be incorporated into the training programme. We see these initiatives as key milestones on the way to qualify- ing our management team, to develop a corporate culture of open feedback, and to establish a joint vision of management.
  37. 37. 33 DVB Bank SE | Group Annual Report 2013 THE COMPANY FINANCIAL AND EQUIT Y MARKETS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Our employees Environmentally friendly travel policies DVB’s Travel Policy stipulates that employees should ideally opt for public transit for business trips, and to get to work every day. We assist in getting job tickets whenever possible and practicable. In order to limit plane trips to only what is truly necessary, DVB believes in using phone and video conferences whenever possible and practical for meetings. These can be convened at all office locations, using state-of-the-art conference technology. Collaborating with the works councils In 2013 we were once again able to swiftly confront new chal- lenges and develop pragmatic solutions. This was only possible thanks to the good co-operation that took place with the SE Works Council, as well as with local Works Councils in Germany and the Netherlands. Health and safety at the workplace Promoting the health of our employees at the workplace is a top priority. We established the Committee for Occupational Health and Safety to be responsible for the creation, maintenance and development of safe and ergonomic workplaces, as well as the identification of potential risks and the prevention of accidents and work-related health problems. We contribute to a comfort- able working environment with modern and high-quality office facilities that foster effective work. Occupational health consulting is carried out by an external provider in Frankfurt/Main. This company supports the Bank in occupational safety, accident prevention and all other health and safety issues. At a local level, Health and Safety Officers are responsible for risk assessment and management as part of occupational safety and for enacting measures to prevent work- related health problems. We offer employees at all of our offices a thorough health check- up, and provide assistance with vaccinations when necessary. To protect our employees in the event of illness, disability or accident, we make an extensive insurance programme available at each of our offices, further supplemented by global policies. We also assign great importance to a healthy diet of our staff: whilst the in-house restaurant at our Bergen office is run by the local branch, DVB has handed over the operation of its employee restaurants in Frankfurt/Main and Rotterdam to external service providers.

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