So you thought you could work for John Cryan's Deutsche Bank and become rich in the style of Anshu Jain? Wrong.
Deutsche Bank's annual report for 2015 is out today, and with it comes the bank's remuneration report for the year. It shows that while some people at Deutsche Bank are doing very well for themselves indeed, most people are not. The vast majority of people at Deutsche Bank are earning moderately well - but far from the sorts of figures associated with a leading investment bank.
In 2015, compensation at Deutsche's corporate and investment bank was split as follows: 1,871 Material Risk Takers (MRTs) earned a combined €1.7bn; the remaining 26,409 people earned a combined €3bn.
In other words, 7% of the people (the MRTs who are senior managers, traders and revenue earners) at Deutsche's corporate and investment bank earned 35% of the pay.
On a per-head basis, the pay differential looks like this:
So, 93% of people in Deutsche's investment bank are earning an average of €115k (£89k, $128k). The disparity is more extreme when you look at bonuses. 63% of the bonus pool in Deutsche's investment bank went to the 1,871 MRTs who constitute 6% of its staff. If you're an MRT at Deutsche you got an average bonus of €486k for 2015. If you're a non-MRT, you got an average bonus of €21k.
However, simply being a material risk taker is not sufficient to guarantee that you'll be paid well. Within the material risk taker's cohort itself, pay is also heavily skewed towards the top end.
Across the entirety of Deutsche Bank, there were 3,005 MRTs in 2015, earning an average of €889k each. And yet, Deutsche also disclosed that 756 people at the bank earned more than €1m last year, with 220 people earning more than €2m. Our calculations suggest that the compensation bill for those 756 alone elite MRTs totaled around €1.5bn of the €2.7bn Deutsche set aside to pay MRTs across the bank. Even within the MRT group, therefore, the implication is that pay per head was distributed as follows:
In other words, the spoils at Deutsche are mostly going to 756 highly paid people. Simply working for Deutsche - and simply working for Deutsche's investment bank, will not make you rich. If you work in finance, you may be part of the elite, but there are elites and there are elites...
Separately, Deutsche's compensation report confirms what Bloomberg has already reported: deferred pay at the bank is now spread over four years instead of three. It also says that 100% of any bonus exceeding €500k is deferred, that 88% of bonuses for MRTs last year were deferred and that Anshu Jain was on a very good deal indeed. Jain earned €6.7m for the last full year he worked (2014) and is still getting a chauffeured car, even thought he's effectively left the bank.