FRANKFURT (Reuters) – Deutsche Bank paid its management board members their first bonuses in four years in 2018, with Christian Sewing’s 7 million euro ($8 million) total pay package making him one of the best paid chief executives in European banking.
Deutsche Bank’s politically sensitive pay disclosures, which were revealed in its annual report on Friday, come as it contemplates a merger with Commerzbank, which unions fear could lead to up to 30,000 job cuts.
Sewing, who became CEO in April last year, led Deutsche Bank to its first profit in four years and is heading the talks with Commerzbank. He earned 2.9 million euros for 2017.
Sewing’s 2018 pay was higher than the CEOs of several other major European investment banks, including HSBC’s CEO John Flint and Barclays boss Jes Staley.
However, the Deutsche Bank CEO received less than his counterpart at Credit Suisse Tidjane Thiam, who got 12.65 million Swiss francs ($12.7 million).
Deutsche Bank’s annual report also revealed that its management board received total pay, including bonuses, of 55.7 million euros ($63.4 million) in 2018, up from 29.8 million euros a year earlier.
The overall bonus pool for 2018 was 1.9 billion euros, down 14 percent from 2.3 billion euros a year earlier, partly as a result of a reduction in headcount, Deutsche Bank said.
Bonuses are a sensitive issue in Germany where many politicians and public opinion are critical of high pay and Anglo-Saxon style capitalism.
Gerhard Schick, finance activist at Finanzwende and ex-member of the German parliament, questioned Deutsche Bank’s bonuses if they were meant as incentives for good performance.
“It adds to the negative overall picture of the bank, which is reeling from scandals and now apparently wants to plunge into a bad merger,” Schick said.
A spokesman for Deutsche Bank declined to comment.
Deutsche Bank has paid large fines for past misdeeds, including a $7.2 billion U.S. penalty in 2017, spooking clients.
And last year it was ensnared in a money laundering scandal involving Danske Bank, while its offices were raided over two days in November in relation to a separate inquiry.
Litigation costs are expected to be “significantly higher” in 2019 than in 2018, Deutsche Bank said in the report.
John Cryan, Sewing’s predecessor, received 8.7 million euros in severance pay and a 2.2 million euro payment to compensate him for what he could earn with a competitor.
Last year’s management reshuffle, which involved Cryan and three other board members, was costly for Deutsche Bank, which paid a combined 25.8 million euros in severance and restraint on competition fees for the four executives, figures in the annual report and provided by the bank revealed.