Deutche Bank Fails to Reach Income Goal, Cuts Executive Compensation

Deutsche Bank

management compensation dropped an average of 8.9% from 2010 to 2011 as the bank did not perform as well as it had predicted. The European debt crisis decreased trading cutting net income 76% to 147 million Euros in the fourth quarter. The bank fell short of its goal to double pretax operating profit from 2009 levels, to 10 billion Euros. Pay declined the most for Anshuman Jain, as his total compensation declined from 7.6 million Euros to 5.8 million Euros. Last year Jain was the highest compensated executive as the corporate and investment-banking units reported record revenue. The investment bank saw revenue fall 26% in the fourth quarter of 2011 from 4.6 billion Euros in 2010 to 3.4 billion Euros. Most of the decrease was driven by the sovereign debt difficulties which plagued Europe, Deutsche Bank said February in its end of the year statement. The decline was enough to prompt 500 October job cuts in the unit. Pay declined 15% for bankers in the unit, from about 378,659 Euros each to 332,785 Euros. Other executives did not have as harsh of a pay cut as Jain. Chief Executive Officer Josef Ackermann earned about the same 6.3 million Euros he earned the year prior, making him the board member with the highest compensation. Head of Consumer Banking Rainer Neske earned 2.85 million Euros, the lowest pay among the board members. Juergen Fitschen, head of German banking, earned the same as Neske. Fitschen and Jain will become co-CEOs the end of May. Pay also declined for senior investment bankers at Morgan Stanley

, Credit Suisse

and Citigroup

last year. The 1,363 “regulated employees” whose work has a major influence on the bank's risk portfolio earned about 1.94 billion Euros last year. The number of designated employees increased from 168 in 2010 following the recommendations of financial regulators.