Start of a trend? Europe’s biggest bank reduced bonuses
Bankers at Deutsche Bank AG have expressed disappointment at the news that management intends to impose a 200,000 euro limit to bonuses for 2011.
"Staff with a bonus at or below the maximum would see half of it in cash, and half of it in equity shares that they can sell in August" a source close to the bank told reporters.
"Anything above that is paid in deferred compensation."
The deferred portion will also be half-cash and half-shares and will be paid out over a period of three years.
The bank is the latest to rein in bonus payments in response to unrelenting criticism of the industry's remuneration culture.
Public anger over banking bonuses forced the chief executive of RBS to give up his bonus and this latest move by a major financial player confirms the issue remains contentious.
Falling revenues have already forced Morgan Stanley, Credit Suisse Group AG and Citigroup to reduce bankers’ pay.
In a comment to Bloomberg, John Purcell, founder of London-based recruiter Purcell & Co. said that “the generic ‘war for talent’ is over”.
He added: "Of course, top performers will always be in demand, but the rising tide that lifted all boats has well and truly gone out.
"The recent, current and forthcoming redundancies have fundamentally altered the economics of remuneration in banking.”
Downing Street is braced for a public outcry when the bonus of Barclays boss Bob Diamond is announced later this month.
