Deutsche Bank senior executives leave after deferred payout

This year's bonus cut was the deepest in Deutsche Bank's recent history and came after two straight years of losses. The pace of departures could accelerate in the coming weeks as people who quit at the end of last month wait for their three-month no
This year's bonus cut was the deepest in Deutsche Bank's recent history and came after two straight years of losses. The pace of departures could accelerate in the coming weeks as people who quit at the end of last month wait for their three-month notice period to lapse, said headhunter Aleksander Montalbetti.PHOTO: REUTERS

FRANKFURT • Deutsche Bank, which slashed bonuses for a second straight year, saw several senior employees leave after it paid out deferred compensation for previous years.

At least three executives - Mr Kevin Burke, Mr Neil Hosie and Mr Patrick Kelly - departed from the lender's trading unit in Asia, and one executive, Mr Holger Knittel, took a new job in the bank's home town of Frankfurt.

Mr Burke was the Singapore-based head of Deutsche Bank's institutional client group for debt in Asia and Australia.

Mr Hosie and Mr Kelly were managing directors in Deutsche Bank's Asia equities division.

Deutsche Bank paid out deferred compensation last month, two people familiar with the situation said.

Europe's largest investment bank in January scrapped bonuses of its top executives and slashed variable pay for other senior employees as chief executive John Cryan seeks to rebuild capital buffers eroded by misconduct fines.

The lack of clarity on compensation may make it harder for the bank to retain talent, and the extent of the impact will probably become visible this month, according to people close to the bank.

"We don't see a wave of departures from Deutsche Bank," said Mr Aleksander Montalbetti, a partner with Indigo Headhunters in Frankfurt. "But we do see a raised level of movement and especially a higher (level of) openness to job changes. And other banks are actively asking about candidates from Deutsche Bank."

The pace of departures could accelerate in the coming weeks as people who quit at the end of last month wait for their three-month notice period to lapse, Mr Montalbetti said. A spokesman for the bank declined to comment.

Deutsche Bank is in the midst of a second turnaround plan in less than two years, an overhaul now centred on combining its trading and advisory businesses, and integrating consumer bank Postbank instead of selling it.

This week, the bank is scheduled to complete selling €8 billion (S$12 billion) of new stock to bolster capital. A majority of shareholders are participating in the capital increase, Handelsblatt business news reported.

Deutsche Bank rose 0.5 per cent to €15.68 yesterday morning in Frankfurt trading, bringing gains in the past six months to 46 per cent.

This year's bonus cut was the deepest in the bank's recent history and came after two straight years of losses.

To make sure key employees do not leave, Deutsche Bank granted so-called retention awards worth roughly €1.1 billion to about 5,000 critical employees vesting over a period of up to six years.

A survey by eFinancialCareers in Britain found that the bank slipped seven positions in its annual ranking of most popular employers for financial professionals, to 15th place from eighth last year.

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A version of this article appeared in the print edition of The Straits Times on April 06, 2017, with the headline 'Deutsche Bank senior executives leave after deferred payout'. Print Edition | Subscribe