BERLIN, March 16 (Xinhua) -- Deutsche Bank has increased the level of bonus payments to employees despite recording higher-than-forecast losses in 2017, an annual report published on Friday by company shows.
Even after a painful multi-year restructuring effort, bottom line earnings at the Frankfurt-based financial institute were still in the red by 735 million euros (906 million U.S. dollars) in 2017, taking the figure of Deutsche Bank's cumulative annual losses since 2015 to 9 billion euros.
The news comes shortly after chief executive officer John Cryan announced to press that he expected a smaller annual loss of 497 million euros this year.
At the same time, the annual company report showed that bonus payments more than doubled from 546 million years in 2016 to 2.275 billion euros in 2017. Total compensation to staff grew as well to a lump sum of 10.3 billion euros, returning to a level last witnessed between 2012 and 2015.
Under pressure of large losses and related intense public scrutiny, Cryan drastically cut variable compensation paid out in 2016. According to magazine Spiegel, staff in the traditionally well-heeled investment banking has since succeeded in convincing management to reverse its more austere course.
Deutsche Bank justified the steep pay rises by highlighting that it had made an operative profit of 1.2 billion euros in 2017 and attributing the bulk of net losses to a one-off effect associated with the U.S. corporate taxation reform. Additionally, the bank argued that it needed to pay competitive salaries in order to attract and retain high-performing staff.
Deutsche Bank is Germany's largest financial institute measured by the size of its balance sheet and employees 43,000 employees in the country. The bank has been rocked by a series of international scandals since the 2007-08 financial crisis surrounding diverse allegations of fraud which have harmed its reputation and profitability.
