Deutsche Bank’s 2018 compensation report is out. For anyone wondering what salaries are bonuses were like on average at Deutsche’s corporate and investment bank for last year, all is now clear.
Firstly, the bonus pool in the corporate and investment bank (CIB) was down 23%, to €1,033m. Secondly, individual material risk takers at Deutsche Bank saw their bonuses cut by an average of nearly 30% compared to 2017. As a result, bonuses in Deutsche's investment bank are now a long, long way below rivals Credit Suisse and UBS.
The chart below, which is based on each bank's remuneration report depicts the pain. While the average material risk taker at Deutsche Bank gets a higher salary than his or her counterparts at Credit Suisse and UBS, his bonus is a lot lower.
There is some good news for Deutsche's high earners though. As we noted earlier, the bank has increased the number of people earning over €5m. In 2018, 27 people fell into this category. In 2017, just 11 did. Moreover, today's report suggests they'll get that money sooner. - Deutsche has traditionally made its “senior leadership cadre” (defined as people reporting to the management board, significant influencers, and “stewards” of the bank’s long-term health and performance) wait 4.5 years before any of their restricted equity awards vest, but today's remuneration report suggests awards will now vest gradually over a four to five year period.
The bad news is that material risk takers at Deutsche Bank start getting their bonuses deferred once they exceed €50k and that non-material risk takers get their bonuses deferred once they exceed €150k. Worst of all, anyone earning over €500k at Deutsche Bank has the entirety of their bonus deferred and won't receive any of it in cash this year.
If you're junior at Deutsche Bank, none of this is likely to bother you. In line with the bank's policy for the past few years, there are no individual performance bonuses for anyone at assistant vice president level or below in the corporate hierarchy.
Deutsche also reiterated today that it doesn’t consider Goldman Sachs part of its peer group when it comes to compensation comparisons. Instead, the bank looks at bonus levels at BNP Paribas, Société Générale, Barclays Credit Suisse, UBS, Bank of America, Citigroup, JPMorgan and HSBC. Given the far higher bonuses at Credit Suisse and UBS, it might want to look a little harder next year.
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