first_imgBanking organisation Deutsche Bank has limited its bonus payments for the 2016 financial year, and will not be providing any individual variable compensation for senior executive staff.The changes will mean that employees with the corporate titles of vice president, director and managing director will still receive the group variable compensation component, which is based on the bank’s overall performance, however individual variable compensation will not be granted to these employees for the 2016 financial year.The organisation’s recognition awards, which are available for eligible employees up to the assistant vice president level, will still go ahead.Employees up to the assistant vice president level who are not eligible for a recognition award may receive a limited individual variable compensation award for 2016.Binding contractual agreements, which include bonuses covered by collective tariff agreements, will not be affected by the changes.A limited number of employees will be granted a special long-term incentive award. This will partly be offered in the form of shares, and will be deferred for up to six years.The management board at Deutsche Bank has decided to waive its variable compensation for 2016.Deutsche Bank estimates that 75% of employees are not or are hardly affected by the changes to individual variable compensation, and the bank plans to return to its normal compensation programmes for the 2017 financial year.The organisation is implementing the changes to bonus payments in light of its performance over the financial year, as well as the financial impact of a $7.2 billion settlement with the US Department of Justice regarding claims that Deutsche Bank misled investors in the packaging, securitisation, marketing, sale and issuance of residential mortgage-backed securities between 2006 and 2007.In a statement to employees on 18 January 2017, the management board at Deutsche Bank said: “We are aware that many of you will be disappointed by this decision about 2016 bonuses. We know how hard you work for the bank. We recognise how committed you remained throughout the challenging days in the autumn, and indeed not only then.“Today we are able to say that our bank is resilient thanks to your hard work and dedication. Unfortunately, this recognition will not be reflected in the amount of individual variable compensation this year. We sincerely regret this.“We have taken this tough decision because it is the right thing to do. Other [organisations] have taken similar steps in the past and have come back stronger than before. We are convinced that we will too. We plan to return to our normal compensation programmes for the year 2017.”last_img

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