Deutsche Bank chiefs: we must pay bonuses to keep top staff

Simon English
·2-min read
Getty Images
Getty Images

DEUTSCHE Bank swung to its best profit in almost two years, as bond traders in London and elsewhere cashed in on volatile markets and investor nerves.

The bank, in the midst of a giant shake-up led by CEO Christian Sewing, made e309 million (£360 million) in the last three months, its third straight profit this year.

In common with other banks, bad debts were lower than feared and the investment bank boomed.

That is good news for the 7,500 staff on London Wall and in Canary Wharf whose jobs are plainly at risk.

Deutsche is cutting 18,000 jobs worldwide out of 92,000, though the retail arm in Germany is likely to be worst hit.

The bond arm, which is what Deutsche is best known for in London having moved out of equities, saw revenue jump 47%.

That should be good for year-end bonuses. Chief financial officer James von Moltke told Bloomberg: “A company like ours need to be able to pay for competitive performance. It is sensible to be able to protect the franchise by being able to compensate our employees in line with our performance.”

The profits this time compared to a loss of e832 million a year ago when Deutsche seemed truly in the mire.

Chief financial officer James von Moltke agreed that government Covid support measures had proved vital but that so far there was no “cliff effects” from those stimulus packages expiring.

“Will this support be a sufficient bridge... through the pandemic?," he said. "The evidence so far gives cause for optimism.”

There was no mention in the statement today of Deutsche’s most famous client, President Donald Trump, who owes the bank $340 million. Executives are said to be nervous about the ability of Trump to make good on his loans.

For critics of the bank, it becoming at one-point Trump’s biggest creditor is clear evidence of how badly it lost its way.

Once a stalwart of corporate Germany providing backing to its giant manufacturing and car industries, it had diversified into derivatives options and other complex trading.

Deutsche shares were steady today at e7.9, valuing the bank at e16.5 billion.