By Eyk Henning
FRANKFURT--Deutsche Bank AG Friday said it slashed the
compensation for its co-chief executives, Anshu Jain and Jürgen
Fitschen, to a total of EUR6.6 million ($7 million) in 2014, down
from EUR7.5 million a year earlier, even though the giant German
lender improved net profit.
"We were disciplined regarding compensation," Mr. Fitschen said
in a video statement. The compensation of the entire management
fell to EUR35.3 million from EUR38.5 million.
Deutsche Bank's supervisory board, headed by Paul Achleitner,
has frozen the payment of millions of euros in bonuses to current
and former senior executives to reflect the risks from legal
investigations, people familiar with the matter told The Wall
Street Journal in October. The measure is part of a broader effort
to change the management culture at Germany's largest bank. The
move also comes in light of many legal disputes the bank faces,
which are set to increase litigation costs.
In 2014, Deutsche Bank's net profit rose to EUR1.7 billion from
around EUR700 million the previous year on the back of improved
investment banking results and lower litigation expenses. Germany's
largest lender by market value, however, still lags behind many
rivals in terms of profitability, and analysts believe the bank
won't meet its financial targets for this year and next. Deutsche
Bank in its annual report acknowledged the difficulties amid higher
regulatory costs and low interest rates. The bank is currently
working on a strategic overhaul to improve profits and share
price.
In a joint statement, Messrs. Jain and Fitschen said, "We are
aware the road ahead is challenging; we are now working diligently
on the next phase of our strategy," which will be presented in the
second quarter.
The compensation of Deutsche Bank's chief executives compares
with UBS AG's Sergio Ermotti, who received nearly 11.2 million
Swiss francs ($11.1 million) in total compensation for last year,
up from 10.7 million francs in 2013. In the U.S., Goldman Sachs
Group Inc.'s Lloyd Blankfein, who so far has the largest pay
package of major U.S. bank executives, was awarded $24 million for
2014, up from $23 million a year earlier. J.P. Morgan's James Dimon
pocketed a flat $20 million.
Like many of its rivals, Deutsche Bank is under investigation
for alleged manipulation of interbank lending rates or foreign
exchange markets, potentially resulting in several billions in
fines.
Overall, Deutsche Bank faces 180 regulatory investigations and
1,000 lawsuits with a claim value of above EUR100,000 each, Chief
Financial Officer Stefan Krause said last May. Legal fees and
settlement payments have cost the bank more than EUR5 billion over
the past two years. They have squeezed profits and hampered the
bank's efforts to strengthen its capital buffers.
Write to Eyk Henning at eyk.henning@wsj.com
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