Yesterday was Deutsche Bank's bonus day. Bloomberg says the bonus pool at the bank was cut by 10% to 15% on last year. Insiders in the loss-making equities business say their bonus pool seemed to be down 30% to 40%. Young corporate financiers were very happy, some members of the credit trading team were ecstatic, but elsewhere in the bank there were zeroes. A lot of zeroes...
Some of those whose bonuses were reduced to nothing yesterday have contacted eFinancialCareers with their gripes. We've reproduced them, in largely unedited form, below. They may simply be the gripes of a few malcontents, or they may be the indication of a deeper malaise. Deutsche Bank declined to comment.
The bonuses were not allocated fairly
"There does not seem to be any transparency as to what rubric was used to determine who got zeroed and who didn’t. Desk-level managers do not know and are saying that they had no input into the process. This seems to be a decision made at a very senior level but no one really knows how. Of the many people I have spoken to I can give examples of people, one who got zeroed and one who got a bonus, who both produced almost identical revenue in 2018. How was the decision made to compensate one but not the other? Was this just a popularity contest?"
Why should we stay?
"In 2016 the CEO at the time made a very specific point of telling employees that the bonus reduction for 2016-2017 would be a one time event and would not reset people’s comp levels for future years. There has been no similar communication this year. Are some employees to assume that their compensation level has now been reset to zero? The message for 2019 is work hard, drive revenue, work harder than you did in 2018 and we might pay you up from zero? Is the message...Do not get laid off? The people who were zeroed would all receive far larger severance packages in a lay-off then they are likely to receive as a bonus for the next several years combined, so I’m not sure how not being laid off is a motivator.
The truth is that people in this industry are motivated by money. There are few, if any, people here who when asked in grammar school what the wanted to do when they grow up said “my dream is to work agency orders at 15% of volume for a failing European investment bank.” This is not the Gates Foundation, we are not saving the world from malaria. When people believe that their productivity has no impact on their compensation they will cease to be productive or change their employment."
[Editor's note - This doesn't seem to apply to people in credit trading. - One insists that Deutsche is the, "most interesting place to be on the Street," because it does massive trades and lets people have an entrepreneurial approach.]
The most senior staff consistently look after themselves
"I know several producers who have had to downsize lifestyles over the years (I appreciate that sounds pathetic and it is, but changing schools and selling up your sole home stinks for anyone) while I am not aware of one single senior manager who has done so. Indeed I am aware of some senior folks having bought new homes and second homes while the stock cratered over the last 3-4 years.
In this bonus round, the same thing seems to have happened again. Virtually everyone I know got shafted except for the top people and their mates one or two levels below them. They seem to get a fortune every year. Good for them!"
These staff need to explain what happened and to articulate their strategy
"It says a lot about the character of management that these gentlemen who are paid a significant amount of money do not have the courage to stand in front of their employees and explain what happened and why and what people should expect going forward. A rational person can’t help but come to the conclusion that they have no idea what is going on and they are just making it up as they go along."
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