Wednesday, February 18, 2009

Dresdner To "Voluntarily" Eliminate Banker Bonus Guarantees

In the latest twist on the bonus debacle, Dresdner Kleinwort (bought recently by German megabank Commerzbank from another megabank Allianz), which is not known for wise financial decisions (let's buy Wasserstein for an insane amount of $$$, only to see him bail a year later) has asked bankers to "voluntarily" give up all bonuses, even contractually guaranteed ones. This is a curious decision on dealing with guarantees which will likely be incorporated by all companies that have locked-in guaranteed bonus schemes. Commerzbank's CFO Eric Strutz has this comment:
"I call on those who generated losses to live up to their responsibility. We are counting on their goodwill."
Banker goodwill? Turns out bankers at DK were promised bonuses, and the concern is that they may now sue to get what is contractually theirs. More from Strutz:
“I’m optimistic that others will follow the good example”of investment bankers that have agreed to forgo bonuses, Strutz said. The bank “regrets” it won’t pay bonuses to employees at profitable divisions such as the retail and corporate banking units, he said, adding that it is “hard to explain” this to workers in those units.
Dresdner hopes bankers won't leave because, as Strutz puts it, “We want employees that aren’t only interested in material things. Bankers who only look at their paycheck aren’t usually very loyal." Let's not forget the free coffee and the free German lessons. Just goes to show how deluded the administration can be. The only reason employees won't go anywhere is because they have nowhere to go. Sphere: Related Content
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Anonymous said...

Ha, what free German lessons? That privilege was pulled long ago.

Crap coffee is the only incentive left in the management' toolbox now.

'A DKIB fella'