Deutsche Bank raised salaries to compensate bonus drop

Deutsche Bank raised the fixed pay for its employees to help offset some of the drop in their bonus payments.
Deutsche Bank raised the fixed pay for its employees to help offset some of the drop in their bonus payments.PHOTO: REUTERS

FRANKFURT (REUTERS) - Deutsche Bank has raised fixed pay for employees to partially compensate for a 17 per cent drop in bonus payments, co-Chief Executive John Cryan told German paper Frankfurter Allgemeine Zeitung.

Deutsche Bank wanted to reward its employees for helping to deliver a solid operating result, Cryan told the paper in an interview published on Monday. "We cannot hold all our colleagues collectively responsible for the missteps of the past," Mr Cryan said.

Fixed salaries had been raised to partially compensate the reduction of the bonus pool to 2.4 billion euros (S$3.7 billion) from 2.7 billion euros, Mr Cryan said.

He blamed Germany's move to change insolvency legislation for shaking investor confidence in the bank. "This made many investors feel insecure and we have not succeeded in commmunicating these very technical aspects in a clear manner," Mr Cryan told the paper.

In January, rating agency Moody's downgraded Deutsche Bank's debt rating after Germany changed insolvency legislaton in January, imposing a higher severity of loss for senior unsecured debt instruments.

Deutsche Bank responded by buying back more than US$5 billion in senior debt, in February.

Mr Cryan reiterated that the bank would not rule out considering a capital increase, although the lender was currently able to meet capital requirements with other means.