Opportunity and risk report

Management assessment of the risk situation

Overview of opportunities and risks

At present, the main risks for DB Group arise in particular from the ongoing development of the Covid-19 pandemic as well as from the point at which recovery in demand for passenger transport resumes, and the speed and sustainability of that recovery. Recovery in demand is of fundamental importance for improving the economic situation. It is equally important to ensure that any planned countermeasures and mitiga­­­tion measures as well as those that may be additionally required depending on the further development of the Covid-19 pandemic are fully implemented. These include, in particular, the measures for the planned strenghtening of equity and the conclusion of the current state aid procedures.

The current risk situation is assessed on the basis of our RMS. Opportunities and risks that are highly likely (PoO > 70%) have been dealt with in the mid-term planning. The system is based on the requirements of the KonTraG and is continually evolving. During the year under review, there were no major methodological changes to that system.

In addition to the risks posed by the Covid-19 pandemic, as of December 31, 2020 DB Group’s main risks (likely risks) were in the areas of law and contracts, and regulation.

Opportunities beyond the EBIT forecast (likely opportunities) exist primarily in additional public support measures for passenger transport in Germany and Europe as well as in the economic climate, market and competition area.

Third-party evaluation is also an important indicator for overall risk assessment. In addition to the internal risk assess­ment, DB Group’s creditworthiness and its aggregated default risk are also assessed by the credit ratings of Moody’s and S&P. Their external assessments of DB Group’s overall risk position are reflected in the good ratings. In the sustainability area, potential risks posed by ESG rating agencies such as MSCI and ISS ESG are assessed and evaluated externally.

In terms of organization, we have created all of the conditions necessary to enable the early identification of possible risks. Our continuous risk management and the active management of key risk categories contribute to limiting risks. Key strategic opportunities and risks were identified at the business unit level and recorded in the course of the strategic process for operationalization with measures. Our analyses of opportunities and risks, countermeasures, hedging and precautionary measures, together with the opinion of the Management Board based on the current risk assessment and our mid-term planning (MTP), indicate that there are no risks that, individually or jointly, could have an impact on the net assets, financial position and results of operations of DB Group and that would pose a threat to the Group as a going concern.

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