Update: The day just got a lot worse for Deutsche Bank employees as Bloomberg reports staff just learned their bonuses on Wednesday, with many facing deep cuts and some bankers in New York and London receiving zero payouts.
In January, we noted that the bank planned on cutting the company's bonus pool by about 10% this year as the bank struggled to stay afloat, while at the same time trying to retain employees.
But, the latest report from Bloomberg suggests the cuts are worse as the bonus pool for 2018 will be less than 2 billion euros ($2.3 billion), between 10 percent and 15 percent lower than in 2017, and the bank is making more selective payouts it attempted to attempt to keep top earners.
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As we detailed earlier, amid further resignations and increasingly loud calls for some kind of merger/nationalization of Germany's anchor bank, the news for Deutsche Bank just keeps getting worse.
Bloomberg reports that Deutsche estimates that its equities trading unit lost about $750 million last year, according to people with knowledge of the matter.
As the Wall Street Journal reported on Tuesday, citing “internal calculations", the bank at one point considered closing its entire equities operation, which understandable since the U.S. equities unit reportedly hasn’t turned a profit for many years. Furthermore, Deutsche Bank’s equities unit, headed by Peter Selman, recently saw two further senior departures, as the writing on the wall started to emerge.
Ironically, or perhaps nots, DB shares are flying higher after this report - is bad news, good news since it accelerates the bailout?
We suspect this only ends one way...
Deutsche Bank Chief Executive Officer Christian Sewing has privately said that he may need to rethink his current turnaround plan if he concludes that it’s insufficient, and Bloomberg reports that several large Deutsche Bank investors at the time asked for tougher cuts to the U.S. operations.