As of: February 23, 2024, 6:38 p.m
By: Lars-Eric Nievelstein
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The supervisory board of Deutsche Bank has cut the bonuses of several board members.
The reason for this is the chaos at Postbank.
CEO Christian Sewing is also affected.
Frankfurt am Main – The IT problems at Deutsche Bank in the wake of the Postbank merger are costing the group millions.
Thousands of customers had to struggle with technical problems, and in some cases the errors also caused financial damage.
According to figures from the Süddeutsche Zeitung,
by the end of the first quarter of 2024 the costs will amount
to around 80 million euros additional.
Now the supervisory board of Deutsche Bank is drawing conclusions - and is putting the red pencil on the bonus payments to the board members.
Additional costs for Deutsche Bank due to Postbank errors |
80 million euros (South German) |
|---|---|
Payment of damages by Deutsche Bank |
1000 euros maximum per customer |
Bonuses for achieved goals to Christian Sewing (2022) |
Around 5.3 million euros |
IT problems at Deutsche Bank – Postbank merger stalls
The background to these cuts is the digital migration of bank customer data.
After Deutsche Bank took over Postbank, it wanted to combine the customer data of both banks on a common platform.
This resulted in major technical problems, so that the bank quickly had to abandon its goal of completing this data migration in 2023.
Christian Sewing, CEO of Deutsche Bank, at the annual press conference.
The bank's supervisory board is reducing the bonus payments of several board members.
© IMAGO / Rainer Unkel
In total, it involved the data of twelve million customers, which were to be moved to a common platform in several waves with seven million Deutsche Bank customers.
According to the
Tagesschau,
there were a whole range of different problems: some customers could not access their accounts, other customers found that their account was suddenly blocked or direct debits could not be honored.
Hardly any help could be expected from customer service.
In 2023, complaints from Postbank customers increased.
Customers are suing Deutsche Bank
In addition to the costs for the technical problems and their resolution, there were also claims and lawsuits from customers against Deutsche Bank.
The bank said that all damages incurred would be reimbursed, but as recently as December, news was circulating that the financial institution was trying to bargain customers down.
In the first quarter of 2024, a further 80 million euros in additional costs were added, reported the
Süddeutsche Zeitung
.
For the board members, this now means losses in their performance bonuses.
However, it was said that no one had to go without a bonus.
Several board members would have to accept cuts, including CEO Christian Sewing.
However, he was not the hardest hit by these corrections,
Handelsblatt
said, citing insiders from financial circles.
5.3 million euros for Christian Sewing – the supervisory board wants to cut the bonus
As a result, the Supervisory Board wants to cut the variable remuneration of former private customer executive Karl von Rohr most significantly.
His contract ran until autumn 2023 and the bank did not extend it.
It was unclear whether the Postbank problems played a role.
According to Handelsblatt,
his successor Claudio de Sanctis
also has to forgo part of his bonuses.
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Deutsche Bank regularly reveals how high these bonus payments are in its annual reports.
It differentiates between “Short Term Awards” (STA), i.e. bonuses for achieving short and medium-term goals, and “Long Term Awards” (LTA), which are intended to reward the achievement of longer-term goals.
In the most recent annual report, which shows the figures for 2022, the supervisory board granted CEO Christian Sewing combined bonuses of over 5.3 million euros, which supplemented his basic salary of 3.6 million euros.
The proportions of STA and LTA are roughly balanced.
James von Moltke received 4.1 million euros in bonuses, Karl von Rohr 4.2 million.