EFTA01477939.pdf

Deutsche Bank Wealth Management Southern Financial LLC Deutsche Bank CIO Strategies Globally diversified multi-asset class portfolios Globally diversified multi asset class portfolios 4015 Paul Morris aag Managing Director Private Banker Joseph Dursi Director Investor Strategist Pau Barti ucci aag Managing Director Portfolio Mana er ecto Thomas Heidenberger Associate Portfolio Analyst For one-on-one presentation to qualified investors only. EFTA01477939 Table of Contents 1 2 3 4 5 6 Strategy Overview Investment Process Asset Allocation Performance Economic Commentary and Forecasts Appendix Deutsche Bank Wealth Management 1 EFTA01477940 Discretionary Portfolio Management At a glance Assets entrusted to us AuM € billion Global Regions 20 Americas 17 EM EA Frankfurt Zurich, Geneva Luxembourg Boston Chicago San Francisco Los Angeles Baltimore London Madrid New York Hong Kong Singapore Retail 2% UHNWI 72% Affluent 6% HNWI 20% Melbourne EM EA combines Europe (excluding Germany), Middle East and Africa. lAll data as of December 31, 2015. Source: Deutsche Bank, Deutsche Asset & Wealth Management Deutsche Bank Wealth Management 2 Not e: Retail <100-500k Affluent <1-2mn HMWI <3mn-lOmn UHNWI <25mn History and coverage 601 21 G ermany Milan Vienna 1.6 APAC EFTA01477941 We are proud of our long history which dates back to 1968. Regional teams include 166 investment professionals who have an average industry experience of 10.5 years. Together they run a global DPM service for almost 24,000 clientsl in four regions: EFTA01477942 Strategy Overview CIO Strategies is our discretionary solution for multi asset investors CIO Strategies is an open architecture, broadly diversified discretionary portfolio solution which seeks to meet or exceed a client's return objectives while staying within their stated risk parameters Investment allocations in each of the four strategies are actively managed to take advantage of tactical opportunities in different asset classes while maintaining that strategy's risk/return requirements. Currently utilizes three asset classes and 14 sub-asset classes; U.S. large cap equity and U.S. investment grade bonds may be separately managed by proprietary asset class specialists. Sub-asset classes are implemented through top-quartile proprietary and third - party mutual funds and ETFs. Deutsche Bank Wealth Management 3 EFTA01477943 Multi Asset Investment Process A global, consistent and transparent process Multi Asset Investment Process Portfolio Construction CIO View Global Asset Research Allocation MIC1 Regional Asset Allocation RIC2 Security Selection PIC3 Portfolio Management Client Portfolio Quality Management 1 MIC = Multi Asset Investment Committee 2 RIC = Regional Investment Committee 3 PIC = Portfolio Implementation reCommendation Source: Deutsche Bank Wealth Management Deutsche Bank Wealth Management 4 EFTA01477944 Multi Asset Investment Process Deutsche Bank Wealth Management's CIO1 View and Research is the starting point View Generation A quarterly CIO Day gathers the most senior professionals in Deutsche Bank WM responsible for asset classes and research. Investment experts assess the macro-economic environment and outlook, indentifying and analyzing key market drivers. Outlook for Fixed Income, Equities, Alternatives and Multi Assets is reviewed and challenged. The decisions taken at the CIO Day are presented in our CIO View which includes: Macro-economic environment Single asset class outlook Financial market forecasts and high-conviction ideas Risks to the main scenario Strategic CIO View is the starting point for our multi asset investment process 1 Chief Investment Officer (CIO) Source: Deutsche Bank Wealth Management Deutsche Bank Wealth Management 5 EFTA01477945 Multi Asset Investment Process Multi Asset Investment Committee (MIC) Investment Process: from global to local MIC RIC / PIC Client Portfolios MIC The Multi Asset Investment Committee (MIC) decides about global lead allocation, currency and duration recommendations based on CIO View and single asset class input. The MIC creates a global cross-asset view which serves as the basis for regional allocation decisions. Source: Deutsche Bank Wealth Management Deutsche Bank Wealth Management 6 RIC Regional Investment Committees (RIC) exist in Germany, the Americas, EMEA and Asia The committees create regional multi asset lead portfolios that provide local flavor with higher granularity and integrate regional investors' preferences. The regional lead allocations serve as basis for Multi Asset Allocation strategies. PIC Portfolio Implementation reCommendation (PIC) Different asset-class specific groups create investable portfolio implementation recommendations on single security level suitable to implement RIC allocations. These groups use best in class research and the entire know-how of the group to advise best solutions for Multi Asset clients. EFTA01477946 Multi Asset Investment Process The Americas Regional Investment Committee refines asset allocations for clients Multi Asset Investment Committee Global asset allocation Americas Regional Investment Committee (RIC) Asset allocation for U.S. portfolios Selection of third party managers Strategic Asset Allocation — Long term (10-year outlook) — Sensitive to after-tax returns — Changes infrequently (1 year) Tactical Asset Allocationl — Shorter term (12-month outlook) — Sensitive to after-tax returns — Changes with outlook for asset classes Allocations Along Efficient Frontier2 Client Portfolios Return Portfolio Consultants tailor models according to client's unique circumstances Risk We are not tax advisors, therefore please consult with your tax, legal, accounting and financial consultants before making any investment decisions. 1Tactical considerations alone drive periodic rebalancing elections by the RIC. Strategic considerations are factored into long-term modeling. 2The efficient frontier is graphical representation of portfolios giving the highest level of expected return at different levels of risk. Source: Deutsche Bank Wealth Management Deutsche Bank Wealth Management 7 EFTA01477947 Multi Asset Investment Process Portfolio Implementation & Research Process The Global Investment Group Selection Process Database Screening Performance, risk, peer rankings Initial Fact Finding Learn about firm/strategy via conference calls and questionnaire On-site visits Interview principals, senior management, portfolio managers and analysts Further analysis Qualitative and quantitative analysis using state-of-the-art tools Final Assessment Finalists presented to GIG Investment Committee On-going Monitoring: Focus on consistency, stability and predictability — We seek to identify the strongest candidates from a broad database of asset managers. — We isolate and analyze quantitative and qualitative factors that we believe are the key drivers of potential future performance. Source: Deutsche Bank Wealth Management Deutsche Bank Wealth Management EFTA01477948 8 EFTA01477949 Strategic and tactical allocations Proposed allocations for taxable client (where hedge funds are suitable) Income Growth & Income Equities U.S. Large Cap U.S. Small Cap EAFE European Japan Pacific ex-Japan Emerging Market Core Emg Mkts Equity Emg Mkts Asia Equity Fixed Income & Cash Municipal Bonds High Yield Bonds Int'l Bonds- Hedged Emerging Market Bonds TIPS Cash Alternatives Hedge Funds Non-directional HF Directional HF Commodities 58.5% 50.5% 2.0% --2.0% 2.0% 2.0% 9.0% 7.0% 5.0% 2.0% 2.0% 100.0% Strategic 32.5% 15.0% 2.0% 11.5% 7.5% 2.5% 1.5% 4.0% Tactical 32.5% 16.5% 1.5% EFTA01477950 EFTA01477951 %0'i %O'Z %0'E soS'Z %S'17, 965'8i %O'Z %S'SZ 960'617 lepT1Dei %0'9 soS'Z soO'S 96S —Ei 960'Li %S'Z %S'EZ 960'617 DT6eleilS %0'00i %O'Z %0'.17 s6S't • '8 %S'OT %O'Z %O'Z 96S*Z-- %O'Z %0*ZE %S'017 %0'00i %0'i %O'Z %O'S %O'L %0'8 %0'.17 %0'i %0'E %S'OS 965'65 %0'0 • i soS'i soS'i %0'.17 • 'L %0'ET 41.5% 32.0% 3.0% --1.0% 1.0% 4.5% 9.5% 8.5% 4.5% 4.0% 1.0% 100.0% 24.0% 16.0% 2.0% --2.0% 2.0% 2.0% 9.0% 7.0% 3.0% 4.0% 2.0% 100.0% Strategic 67.0% 33.0% 3.5% 22.5% 15.0% 4.5% 3.0% 8.0% Growth Maximum Growth Tactical 67.5% 35.5% 3.0% 25.0% 15.0% 7.0% 3.0% 4.0% 2.5% 1.5% 24.5% 16.0% 3.0% --1.0% EFTA01477952 1.0% 3.5% 8.0% 7.0% 3.0% 4.0% 1.0% 100.0% 7.0% --2.5% --2.5% --2.0% 8.5% 6.0% --6.0% 2.5% 100.0% Strategic 84.5% 42.0% 4.0% 29.0% 20.0% 5.5% 3.5% 9.5% Tactical 84.5% 45.0% 3.0% 31.5% 20.0% 8.0% 3.5% 5.0% 3.0% 2.0% 8.5% --3.5% --1.0% --4.0% 7.0% 6.0% --6.0% 1.0% 100.0% Source: Internal sources. Last asset allocation change was March 22, 2016 and is reviewed monthly. Allocation recommendations are subject to change without notice. The "strategic allocation" represents our longer term outlook on portfolio diversification and serves EFTA01477953 as a frame of reference for our short-term tactical adjustments for U.S. clients. Actual portfolio composition and performance will vary within the strategic range based upon active market judgments, altering the allocation and adjusting within asset classes. Neither this Allocation Table nor any of its contents may be used for any purpose without the consent and knowledge of Deutsche Bank. It may not be reproduced or circulated without our written authority. The asset allocations described herein are formulated by the Regional Investment Committee within Wealth Management (RIC) and may utilize the following asset class components: U.S. large cap equity, U.S. small cap equity, Japan equity, Europe equity, Pacific ex-Japan equity, emerging markets equity, U.S. fixed income, U.S. high-yield bonds, international bonds, emerging market bonds, municipal bonds, Treasury Inflation Protected Securities, hedge funds, Real Estate Investment Trusts, commodities, and cash. The RIC currently recognizes four basic investment strategies: Income, Growth & Income, Growth, and Maximum Growth. The strategy selected is based upon the individual investor's objectives and risk tolerance. Your selected portfolio will determine the specific allocation to the asset classes represented by these vehicles. This document is for information purposes only. Not intended to be an offer or solicitation. The products and services above are not appropriate for everyone. An interested party must make his/her own independent legal, tax, accounting and financial evaluation of their merits and risks. Deutsche Bank does not provide tax, legal, or accounting advice. These products and services are not insured by any governmental entity and are subject to investment risk including possible loss of principal. Availability of these products and services may be limited by applicable law. These products are not FDIC insured and are not obligations of nor guaranteed by Deutsche Bank AG or its affiliates. Opinions expressed herein may differ from those expressed by departments or other divisions or affiliates of Deutsche Bank. "Deutsche Bank" means Deutsche Bank AG and its affiliated companies, as the context requires. Wealth Management refers to Deutsche Bank's wealth management activities for highnet-worth clients around the world. Deutsche Bank Wealth Management 9 EFTA01477954 Growth Tactical allocations Proposed allocations for taxable client (where hedge funds are suitable) Implementation Vehicle Ticker Equities U.S. Large Cap U.S. Small Cap EAFE European European Japan Pacific ex-Japan Emerging Market Core Emg Mkts Equity Emg Mkts Asia Equity Fixed Income & Cash Municipal Bonds High Yield Bonds Int'l Bonds- Hedged Emerging Market Bonds TIPS Cash Alternatives Hedge Funds Non-directional HF Directional HF Commodities Total Prisma Spectrum Fund Lighthouse Global Long/Short Deutsche Enhanced Commodity Strategy N/A N/A SKIRX Aberdeen Emerging Markets Fund Invesco Asia Pacific Growth Fund WM Intermediate Tax Exempt Fixed Income — Individual Securities ABEMX ASIYX N/A Blackrock High Yield Fund BHYIX MFS Emerging Market Debt Fund MEDIX BlackRock Infl Protected Bond Fund BPRIX Invesco AIM European Growth db X-Trackers MSCI Europe Hedged Equity Fund Wisdomtree Japan Hedged Equity iShares MSCI Pacific ex Japan AEDYX EFTA01477955 DBEU DXJ EPP WM US Large Cap/Growth - Individual Securities N/A ClearBridge Small Cap Growth SBPYX Allocation as % of Portfolio 67.5% 35.5% 3.0% 25.0% 7.5% 7.5% 7.0% 3.0% 4.0% 2.5% 1.5% 24.5% 16.0% 3.0% 1.0% 1.0% 3.5% 8.0% 7.0% 3.0% 4.0% 1.0% 100.0% Allocation in USD $33,750,000 $17,750,000 $1,500,000 $12,500,000 $3,750,000 $3,750,000 $3,500,000 $1,500,000 $2,000,000 $1,250,000 $750,000 $12,250,000 $8,000,000 $1,500,000 $500,000 $500,000 $1,750,000 $4,000,000 EFTA01477956 $3,500,000 $1,500,000 $2,000,000 $500,000 $50,000,000 Source: Internal sources. Last asset allocation change was March 22, 2016 and is reviewed monthly. Allocation recommendations are subject to change without notice. The "strategic allocation" represents our longer term outlook on portfolio diversification and serves as a frame of reference for our short-term tactical adjustments for U.S. clients. Actual portfolio composition and performance will vary within the strategic range based upon active market judgments, altering the allocation and adjusting within asset classes. Neither this Allocation Table nor any of its contents may be used for any purpose without the consent and knowledge of Deutsche Bank. It may not be reproduced or circulated without our written authority. The asset allocations described herein are formulated by the Regional Investment Committee within Wealth Management (RIC) and may utilize the following asset class components: U.S. large cap equity, U.S. small cap equity, Japan equity, Europe equity, Pacific ex-Japan equity, emerging markets equity, U.S. fixed income, U.S. high-yield bonds, international bonds, emerging market bonds, municipal bonds, Treasury Inflation Protected Securities, hedge funds, Real Estate Investment Trusts, commodities, and cash. The RIC currently recognizes four basic investment strategies: Income, Growth & Income, Growth, and Maximum Growth. The strategy selected is based upon the individual investor's objectives and risk tolerance. Your selected portfolio will determine the specific allocation to the asset classes represented by these vehicles. This document is for information purposes only. Not intended to be an offer or solicitation. The products and services above are not appropriate for everyone. An interested party must make his/her own independent legal, tax, accounting and financial evaluation of their merits and risks. Deutsche Bank does not provide tax, legal, or accounting advice. These products and services are not insured by any governmental entity and are subject to investment risk including possible loss of principal. Availability of these products and services may be limited by applicable law. These products are not FDIC insured and are not obligations of nor guaranteed by Deutsche Bank AG or its affiliates. Opinions expressed herein may differ from those expressed by departments or other divisions or affiliates of Deutsche Bank. "Deutsche Bank" means Deutsche Bank AG and its affiliated companies, as the context requires. Wealth Management refers to Deutsche Bank's wealth management activities for highnet-worth clients around the world. Deutsche Bank Wealth Management 10 EFTA01477957 CIO Strategies performance A strong track record 11 EFTA01477958 Income Strategy returns Performancel for taxable client ending 12/31/15 -6 -4 -2 0 2 4 6 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 5.07 4.89 2.73 1.80 3.33 2.22 -0.34 3.88 Blended Benchmark 5.07 3.99 5.17 4.03 4Q15 YTD 3 Year 5 Year % Annualized Performance Gross of Fees CIO Strategies - Income Blended Benchmark 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2.22% 4.03% 8.51% 9.66% 1.19% 8.59% 19.02% -16.61% 8.90% 9.12% -0.34% 2.81% 7.68% 8.60% 0.97% 7.83% 17.77% -17.06% 7.25% 8.21% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the Deutsche Bank WM-Americas Core Equity composite can be found in the Deutsche Bank WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Bank Wealth Management 12 EFTA01477959 10 Year 1/1/05-12/31/15 EFTA01477960 Growth & Income Strategy returns Performancel for taxable client ending 12/31/15 -8 -6 -4 -2 0 2 4 6 8 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 6.33 5.92 3.70 2.55 2.12 -1.17 4.35 4.54 Blended Benchmark 5.77 4.37 5.88 4.49 4015 YTD 3 Year 5 Year % Annualized Performance Gross of Fees 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 CIO Strategies - Growth and Income 2.12% 4.37% 12 79% 12.03% -1.03% 11.33% 23.78% -23.04% 10.92% 11.78% Blended Benchmark -1.17% 3.01% 11.60% 10.86% -0.89% 9.84% 21.71% -23.96% 7.97% 11.92% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the Deutsche Bank WM-Americas Core Equity composite can be found in the Deutsche Bank WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Bank EFTA01477961 Wealth Management 13 10 Year 1/1/05-12/31/15 EFTA01477962 Growth Strategy returns Performancel for taxable client ending 12/31/15 10 -10 -8 -6 -4 -2 0 2 4 6 8 4 85 3.41 2 27 -1.67 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 8.05 6.98 5.73 5.46 Blended Benchmark 6.30 4.63 6.45 4.83 4Q15 YTD 3 Year 5 Year % Annualized Performance Gross of Fees CIO Strategies - Growth Blended Benchmark 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2.27% 4.84% 17.64% 14.43% -2.94% 13.79% 29.09% -30.42% 12.52% 14.39% -1.67% 3.40% 16.25% 13.25% -2.57% 11.89% 25.85% -31.31% 8.02% 15.39% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the Deutsche Bank WM-Americas Core Equity composite can be found in the Deutsche Bank WM —Americas Core Equity EFTA01477963 pitchbook which can be provided upon request. Deutsche Bank Wealth Management 14 10 Year 1/1/05-12/31/15 EFTA01477964 Maximum Growth Strategy returns Performancel for taxable client ending 12/31/15 10 12 -12 -10 -8 -6 -4 -2 0 2 4 6 8 5.87 4.14 2.33 -2.53 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 9.65 6.75 7.87 6.02 Blended Benchmark 6.87 4.73 7.04 5.02 4015 YTD 3 Year 5 Year % Annualized Performance Gross of Fees 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 CIO Strategies - Maximum Growth 2.33% 5.37% 22.27% 16.16% -4.65% 15.89% 34.76% -35.93% 13.97% 16.66% Blended Benchmark -2.53% 3.16% 20.96% 15.68% -4.79% 13.68% 30.30% -37.77% 8.14% 18.86% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the Deutsche Bank WM-Americas EFTA01477965 Core Equity composite can be found in the Deutsche Bank WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Bank Wealth Management 15 10 Year 1/1/05-12/31/15 EFTA01477966 Growth & Income with Hedge Funds - Taxable A History of Consistent Performance 3 1 yr Rolling Period -2% -1% 0% 1% 2% 3% 4% 5% Best Period Periods Excess Returns versus Benchmark Jan 2005 — Dec 2015 1 yr Rolling Periods Best Period Median Worst Period Rolling Periods — Monthly Data Batting Average: 108 of 121 Periods 89% 97 of 97 100% 73 of 73 100% DEFINITION of 'Batting Average' - A statistical measure used to measure an investment manager's ability to meet or beat an index. Batting average is calculated by dividing the number of days (or months, quarters, etc ) in which the manager beats or matches the index by the total number of days (or months, quarters, etc.) in the period of question and multiplying that factor by 100. DEFINITION of 'Rolling Returns'-- The annualized average return for a period ending with the listed year. Rolling returns are useful for examining the behavior of returns for holding periods similar to those actually experienced by investors. Note: The performance above is based upon the Deutsche Bank Growth & Income with Hedge Funds Model Portfolio for Taxable Clients. Chart reflects model returns gross of fees, not actual client returns.. Deutsche Bank Wealth Management 16 3 yr Rolling Periods 5 yr Rolling Periods 0.95% 1.28% 1.17% EFTA01477967 Investment Management Fee Schedule Fees are based on the assets under management as valued every month. Fees ordinarily are billed monthly in arrears, and are computed at one-twelfth the annual fee rates detailed below: Equity and Balanced accounts (including custody) — 1.20% on the first $2,000,000 — 0.85% on the next $3,000,000 — 0.60% on the next $5,000,000 — 0.45% on the balance The minimum investment is $2 million. The minimum annual fee per relationship is $24,000. All-inclusive feel: Fee charged includes administrative costs, custody, annual tax reporting, cash management, ongoing research on mutual fund managers, ETFs and securities for all asset classes. In mutual fund investments we use the least expensive share class available which is most often the institutional share class. No trailers, no sales charges and no conflict of interest. Deutsche Bank products are excluded from calculation of the billable assets for advisory fee charge. No Deutsche Bank commission charged on trades. Commission on trades are only charged by the counterparty. Fees are subject to change without notice. Further information available upon request. "1 Certain fees embedded in the price non-proprietary products such as ETFs, mutual funds, hedge funds as well as commissions or markup/markdowns assessed by other Broker Dealers for trading securities are in addition to the Deutsche Bank investment management fee." Deutsche Bank Wealth Management 17 EFTA01477968 Important information The asset allocations described herein are formulated by the Regional Investment Committee (RIC) within Deutsche Bank Wealth Management (Deutsche Bank WM) and may utilize the following asset class components: U.S. large cap equity, U.S. small cap equity, Europe equity, Japan equity, Pacific ex-Japan equity, emerging markets equity, municipal bonds, U.S. high-yield bonds, Treasury Inflation Protected Securities, emerging market debt, hedge funds, commodities, and cash. RIC currently recognizes four basic investment strategies: Income, Growth & Income, Growth, and Maximum Growth. The strategy selected is based upon the individual investor's objectives and risk tolerance. Your selected portfolio will determine the specific allocation to the asset classes represented by the vehicles described herein. Please note returns for the large cap equity portion are represented by the Quality Growth Composite. Implementation vehicles and asset allocations are determined by the Deutsche Bank WM RIC and are change subject at their discretion. Results presented herein do not represent the results of actual trading using client assets. The returns shown in this document are model returns and do not reflect Deutsche Bank management fees or other expenses that may be incurred in the actual management of an account. If such fees and expenses were deducted, the results would be lower. Please be advised of the limitations inherent in using model results. Accounts managed according to the Model may perform differently over the same time period depending on the size of the account, restrictions, the amount of the transaction and related costs, the inception date of the account and other factors. Actual clients may experience returns that are more or less than those of the Model. These model returns do not reflect the impact that material economic factors may have had on our decision-making. Model returns are not indicative of future results; there is always the potential for loss as well as for profit. These returns should not be considered indicative of the skill of the advisor. The CIO Strategy model portfolios commenced on 1/1/05. The model returns reflected herein were achieved by calculating monthly weighted-average returns using actual tactical allocations and vehicles beginning 1/01/05. The model returns presented are used to portray what the CIO Strategies performance would have been during the period if client assets had been invested in these CIO Strategies securities recommendations. Deutsche Bank will continue to employ tactical strategy allocation and rebalancing techniques and therefore the portfolio allocation will change dynamically as market conditions warrant. Please refer to the CIO Strategies marketing information for a description of the methodology used to select investments. The standard fee schedule generally applied to accounts invested in this EFTA01477969 strategy is as follows: 1.20% on the first $2 million; 0.85% on the next $3 million; 0.60% on the next $5 million; and 0.45% on the balance. Actual investment advisory fees incurred by clients may vary. Blended benchmarks are comprised of indices representing the broad asset classes utilized by the RIC. Blended benchmark returns are calculated and rebalanced monthly. A current list of the allocation weights and components in the blended benchmark can be found below. A complete list of historical allocation weights and components is available upon request. Income Sub-asset Class U.S. Large Cap Equity U.S. Small Cap Equity European Equity Japan Equity Pacific ex-Japan Equity Emerging Market Equity Municipal Bonds U.S. High Yield Bonds International Bonds Benchmark S&P 500 Index Russell 2000 Index MSCI Europe Index (net of withholding taxes) MSCI Japan Index (net of withholding taxes) MSCI Pacific Free ex-Japan Index (net of withholding taxes) MSCI Emerging Markets Index (net of withholding taxes) Barclays Municipal Short/Intermediate Index Merrill Lynch/BOA High Yield Master II Index Citigroup Unhedged Non-U.S. World Govt. Bond Index Treasury Inflation Protected Securities Barclays U.S. TIPS Index Emerging Market Debt Hedge Funds Commodities Cash Deutsche Bank Wealth Management DBLCDIVT iMoneyNet Money Funds (All) Tax-Free Average JPMorgan GBI Emerging Markets Index - Unhedged HFRI Fund of Funds Index Allocation 15.00% 2.00% 7.50% 2.50% 1.50% 4.00% 50.50% EFTA01477970 2.00% --2.00% 2.00% 7.00% 2.00% 2.00% 100.00% Growth & Income Allocation 23.50% 2.50% 11.50% 3.00% 2.50% 6.00% 32.00% 2.00% --2.00% 2.50% 8.50% 2.00% 2.00% 100.00% Growth Allocation 33.00% 3.50% 15.00% 4.50% 3.00% 8.00% 16.00% 2.00% --2.00% 2.00% 7.00% 2.00% 2.00% 100.00% Maximum Growth Allocation 42.00% 4.00% 20.00% 5.50% 3.50% 9.50% --2.50% ----2.50% EFTA01477971 6.00% 2.50% 2.00% 100.00% 18 EFTA01477972 Economic & Asset Class Outlook March/April 2016 Outlook World economy — There are initial signs that U.S. manufacturing may be s tabili bilizing with several regional surveys turning positive. While housing data is solid, consumer spending has been tepid. ith l i l — In Europe, manufacturing has been positive, the labor market is improving and personal consumption is solid. However, geopolitical risks are beginning to weigh on sentiment. — Slow global growth has weighed on manufacturing and business confidence in Japan. — Emerging markets continue to gg be challenged by slow global trade, political headwinds and sluggish domestic demand. — Tighter financial conditions in some areas (e.g. U.S.), weak global trade and geopolitical risks have led us to downgrade our 2016 global growth forecast (from 3.4% to 3.2%). led downgrade — All developed markets were brought lower led by the U.S. (from 2.4% to 1.9% in 2016) as an inventory drawdown, weak manufact ring and slow exports may weigh on growth this year. facturing — Europe and Japan were modestly reduced but aggressive central bank policy should support growth. — EM growth should gradually recover as commodity prices find a bottom, reforms take hold and FX volatility subsides. EFTA01477973 Deutsche Bank Wealth Management Monetary Policy, Inflation and FX — Slower U.S. economic growth has resulted in the FOMC ddi tl k downgrading their outlook on growth, inflation and magnitude of Fed funds rate hikes in 2016 th — The ECB will likely remain in a wait and see mode and let the aggressive actions taken at their March meeting (e.g. negative interest rates, increased QE) filter into the economy. — The PBOC and BoJ will keep the door open to take additional stimulus measures to support growth (e.g. QE, rate cuts). — The USD should gain momentum vs. the developed markets as Fed policy diverges from other central banks. — Ongoing geopolitical risks and lower growth than originally anticipated will likely limit the Fed to raise rates one time this year (likely June meeting) with Fed to raise one post election. This will be highly dependant on the outlook for growth and inflation. — A weak Euro and stabilization in commodity prices should help Europe inflation move higher. hi h — Growth and interest rate differentials and diverging monetary policy support the dollar long term, especially versus the Euro and Yen. — China and India should remain accommodative while Latin American countries have less flexibility due to high inflation. e Bond markets EFTA01477974 — Global bond yields will likely remain lower for longer despite th Fed'd's ghtening cycle and modest pick up in inflation. ti ht d — The rise in yields in the near term should be limited due to low commodity prices, central bank QE (ECB and BoJ), geopolitical risks (e.g. Brexit) and concern over at least a modest pullback in risky assets — We remain modestly overweight high yield but active management is recommended. — We remain underweight EM debt due to uncertain economic fundamentals, volatile currencies and heavy USD denominated debt burdens. — The rise in long term yields over the next 12 mos will likely be muted as moderate inflation, a "slow" Fed tightening cycle and aggressive stimulus from the ECB and BoJ keep global sovereign yields contained. Fe tightening — We recommend a modest short duration to the benchmark due to the expectation of modestly higher yields in thth le ong run. — Focus on select credit (e.g. IG and high yield). History suggests credit outperforms sovereigns in tightening cycles. — Cautious on EM debt due to the uncertain growth outlook but looking for opportunities to add. — Active management advised, especially in high yield. Footnotes: Outlook as of March 21, 2016 Multi-Asset Investment Committee Meeting and March 22, 2016 Americas Regional Investment Committee Source: Deutsche Bank Wealth Management Equity markets — Most global Indices have rallied 1096+ since their Feb. lows. As a resu lt, valuations look stretched, technicals are EFTA01477975 approaching overbought 1 ti 1 k territory and near term caution may be warranted. — We reduced our weighting to global equities by lowering the U.S. (still overweight) and Europe (to neutral). — Still favor DM vs. EM. — In the near term, global equities may be challenged by weak earnings, geopolitical risks and stretched valuations. — Favor select cyclicals over defensives. — In EM favor Asia over Latam. — Over the next 12 months, equities should be supported by improving earnings growth, modest economic growth and economic accommodative central banks. — However, heightened volatility will offer tactical opportunities to adjust positions (e.g. regions, sectors) as warranted. — As the economic cycle matures (especially in U.S.), returns should be driven by dividends, buybacks and earnings growth. — Favor DM over EM due to more attractive fundamentals, better earnings visibility and greater monetary policy flexibility. — In EM, favor Asia vs. Latam due to more attractive fundamentals and policy flexibility. Alternatives and Commodities — With oil production continuing to come down (rig count near 1) seven year low) an the ollar remaining under pressure, prices have been able to find near term stability. d th d 11 — However, it is too early to suggest the bottom in oil prices is behind us. Oil prices will likely EFTA01477976 be challenged in the near term as the dollar gains strength and the ongoing supply/demand imbalance remains. — Gold has been supported by geopolitical events, aggressive central bank actions and slower Fed rate hikes. — Increased volatility to favor select hedge funds. — The combination of heightened volatility, over supply and stronger dollar keeps us underweight commodities. ei — However, an expectation for better global growth (in 2016) and likely production cuts should support a modest rise in oil prices over the next 12 months (Mar 2017 target=$50) — Another way to complement commodity exposure is through investments less sensitive to the price of oil (e.g. MLPs, oil transportation & storage). — We favor hedge funds with a focus on equity market neutral. These should benefit from dispersion within equity sectors and regions. 19 Long Term Near Term EFTA01477977 Charts of the Month — March/April 2016 Changes to 2016 GDP Estimate 7.0% 2.0% 3.0% 4.0% 5.0% 6.0% 0.0% 1.0% U.S. Europe Footnotes: Data as of March 2016. Data as of March Source: Deutsche Asset Management, Deutsche Bank Wealth Management. UK November 2015 Forecast for 2016 GDP Japan China World March 2016 Forecast For 2016 GDP Footnotes: Data as of March 25, 2016. Data as of March Source: FactSet, Deutsche Bank Wealth Management. Global Sovereign Yields Highly Correlated Production Cuts Good; More Needed The ECB's aggressive central bank actions have pushed sovereign rates across Europe lower, keeping the rise in U.S rates muted rise in . rates muted. 9,000 10,000 6,000 7,000 8,000 4,000 5,000 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 DOE Crude Oil Production Footnotes: Data as of March 25, 2016. Source: FactSet, Deutsche Bank Wealth Management. Deutsche Bank Wealth Management Footnotes: Data is as of March 18, 2016. Source: Bloomberg Finance LP, Deutsche Bank Wealth Management. 20 Jan-15 Jan-16 EFTA01477978 bbls/day. However, supply is still too high and will According to the Department of Energy total oil production has fallen by nearly 600 million g Y, PP need to come down before a more meaningful rebound in oil prices is seen. The biggest change to our World GDP estimate came from the fth U.S. which was downgraded from 2.4% to hi h d 1.9% in 2016. d d f 2 4% t U.S. Valuations "Stretched" The recent rally in equities has pushed valuations to levels that warrant caution. 1000 bbls/day EFTA01477979 Economic and Capital Market Forecasts March/April 2016 GDP Growth in % World USA Euroland UK Japan China Inflation in % USA (core PCE) Euroland UK Japan China Curr Acct Balance in % of GDP USA Euroland UK Japan China Fiscal Balance in % ofGDP of GDP USA Euroland UK Japan China KI t -2.8% -1.9% -3.3% -6.0% -2.4% Key Interest Rates Ct USA (Fed funds) Euroland (Refi rate) UK (Repo rate) Japan (Mmkt rate) t t l 0.25% 0.00% 0.50% 0.00% Currentl -2.9% -1.9% -2.5% EFTA01477980 -5.2% -2.5% 12 Mo Forecast (Mar 2017) 0.75-1.00% 0.00% 0.50% 0.00% Footnotes: Macro estimates are according to Deutsche Asset & Wealth Management and are as of March 2016. U.S. GDP is 4Q over 4Q. 1 Current as of March 28, 2016. 2 LTM s td f th 3 P/E d EPS f t ditDthAt&Wlth M t 4 Di ti i i b d i i ld 5 Hi h i ld tands or last twelve months. 3 P/E and EPS forecasts are according to Deutsche Asset & Wealth Management 4 Direction in sovereign bonds is yield move. 5 High yield spread is high yield versus five year Treasury. 6 Next 3% move in credit is return move. Source: FactSet, Deutsche Bank Wealth Management. d Deutsche Bank Wealth Management 21 () 2016 3.2% 19% 1.9% 1.5% 2.0% 1.0% 6.0% 2016 1.6% 0.3% 0.6% 0.8% 1.2% 2016 -2.7% 2.9% -3.9% 2.8% 2.5% 2016 2017 EFTA01477981 Currencies 3.6% 20% 2.0% 1.5% 2.1% 0.8% 6.0% 2017 1.7% 1.5% 1.8% 1.8% 1.2% USA (S&P 500) 2017 -2.9% 2.8% -3.5% 2.5% 2.5% 2017 USA Euroland (German Bund) UK Japan Credit Barclays U.S. High Yield Yg 1.89% 0.18% 1.45% -0.10% Current Couponl 6.60% JPM GBI- EM Global Diversified (Local) JPM EMBIG (EM Broad Index) (Hard Currency) Yield 8.35% 6.55% Current Spread5 700 405 Euroland (Euro Stoxx 50) Germany (DAX) UK (FTSE 100) MSCI Japan (JPY) 2037 EFTA01477982 2987 9851 6106 833 Asia ex Japan (MSCI in USD) 495 Latin America (MSCI in USD) 2125 Sovereign Rates Currentl EUR vs USD vs. USD USD vs. JPY EUR vs CHF GBP vs USD USD vs CNY* Commodities Oil (WTI) in USD Gold in USD () Equities Currentl 112 1.12 113.25 1.09 1.43 6.52 Currentl 39 1220 Currentl Dividend Yield 2.1% 4.0% 2.9% 4.1% 2.3% 3.0% 3.1% P/E (LTM)2 NTM P/E 17.38 13.20 12.32 15.38 14.42 12.63 18.86 13.75 13.25 14.50 15.00 EFTA01477983 13.00 17.00 Forecast3 16.75 NTM EPS Forecast3 123 233 818 400 60 39 112 Next 396+ Move $ 44 44 44 44 Next 396+ Move 44 44 Next 396+ Move 44 44 44 44 44 44 1 12 Month Forecast (March 2017) 105 1.05 120.00 1.12 1.50 6.90 12 Month Forecast (March 2017) 50 1100 12 Month Forecast (March 2017) 2060 3200 10800 5800 890 500 1900 EFTA01477984 Next 3%+ Yield Move4 12 Month Forecast (March 2017) 44 44 44 44 Next 3%+ Move6 44 44 44 2.00% 0.35% 1.90% -0.10% 12-Month (Price Return Estimate) -3.2% 12 Month Return (March 2017) -64%6.4% 6.0% 2.6% 5.2% 5.9% 12 Month Return (March 2017) 26.9% -9.8% 12 Month Return (March 2017) 3.3% 11.1% 9.6% -0.9% 9.2% 4.0% -7.5% 12 Month Return (March 2017) 10% 1.0% -1.3% -2.0% -0.1% 12 Month Return 3.4% EFTA01477985 Important information This document has been prepared for informational purposes only and is not an offer, or solicitation of an offer, to buy or sell any security, or a recommendation to enter into any transaction relating to the products and services described herein. Before entering into any transaction, you should take steps to ensure that you understand and have made an independent assessment of the appropriateness of the transaction in light of your own particular financial, legal and tax situation, investment objectives and level of risk tolerance, and you should consult your legal and tax advisers to determine how these products and/or services may affect you. Deutsche Bank does not provide tax, legal or accounting advice. This document contains "forward-looking statements"- that is statements related to future not past events In this context forward -looking statements often address expected future business and financial performance, and often contain words such as "expect," "anticipate," "intend," "plan," "believe," "seek," or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could adversely or positively affect future results include: the behavior of financial markets, including fluctuations in interest and exchange rates, commodity and equity prices and the value of financial assets; continued volatility and further deterioration of the capital markets; the commercial and consumer credit environment; the impact of regulation and regulatory, investigative and legal actions; strategic actions, including acquisitions and dispositions; future integration of acquired businesses; future financial performance of major industries; and numerous other matters of national, regional and global scale, including those of a political, economic, business and competitive nature. These uncertainties may cause actual future results to be materially different than those expressed in our forward-looking statements. This statements related future, , events. 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Changes in emerging markets government structures or other political instability may result in nationalization, expropriation, ad hoc regulation, or foreign investment restrictions. Emerging market investments are at risk for currency devaluation as well as convertibility liquidity and transparency constraints The high volatility and speculative nature of emerging market investments may at risk for , as wel as convertibility, result in both significant losses or profits. Foreign Exchange/Currency - Such transactions involve multiple risks, including currency risk and settlement risk. Economic or financial instability, lack of timely or reliable financial information or unfavorable political or legal developments may substantially and permanently alter the conditions, terms, marketability or price of a foreign currency. 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