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The 12-member board of Deutsche Bank will go without a bonus this year, too. But variable compensation for staff will be paid as planned, CEO John Cryan said at a ZEIT ONLINE event in Austin, Texas.

The total amount for employee bonuses also appears to be higher than previously assumed. "The variable compensation won’t be as high as it was in 2015, but it will be significantly higher than in 2016," Cryan said at a panel discussion with ZEIT ONLINE Editor-in-Chief Jochen Wegner at the technology festival South by Southwest (SXSW). In 2015, Deutsche Bank paid its employees bonuses totaling 2.4 billion euros. But last year, it paid out 546 million euros in bonuses.

Previous media reports indicated a bonus sum of around a billion euros, but Cryan denied that amount in Austin. "I don’t know where the billion is coming from," he said. The billion figure that had been reported by the media in recent weeks had already triggered criticism from politicians and finance industry observers, especially given that Deutsche Bank posted a half-billion-euro loss in 2017. The exact figures will be released this coming Friday.

Although the bank scored many successes in the past year, the CEO feels responsible for the fact that not all goals have been achieved – especially the lack of an overall positive result. That’s why the bank’s executive management is going without a bonus again this year.

Bonus Payments As Investments in the Future

Major shareholders, among others, have complained in recent months that the British CEO has not moved quickly enough to turn the institution around since taking the helm of Deutsche Bank in July 2015. "I myself am one of these critics and I am extremely impatient," Cryan said in Austin, "but it also takes time to turn an oil tanker around."

Jochen Wegner (left), editor-in-chief of ZEIT ONLINE, and John Cryan, CEO of Deutsche Bank © Eike Kühl

Deutsche Bank posted a loss for the third year in a row in 2017, but it was lower than in the two previous years. The CEO ascribed the latest losses largely to the tax reforms in the United States and the associated write-offs. Generally, however, the bank is well on its way to sustainable growth and higher profits, Cryan said in February.

That’s also the reason the bank can’t forgo bonus payments to all employees, Cryan said in Austin. He said the payments to employees cannot be viewed as an additional expenditure, and must instead be seen as an investment in the future. Last year, the bank drastically reduced its bonus payments to staff. He said the company wants to increase those payments this year to prevent losing further employees.

Marcus Schenck, deputy chairman and co-head of investment banking at Deutsche Bank, recently defended the bonuses in an interview, saying, "We need to invest in our people right now and remain internationally competitive – also when it comes to salaries." In investment banking, in particular, high bonus payments are standard.

At its annual earnings press conference at the beginning of February, however, Cryan was more reserved than his deputy. He said bonuses were a "one-off investment designed to give the new management of our corporate and investment bank the opportunity to secure our franchise and to strengthen our position." But that also means that the bankers will have deliver that success in the future.