Bank Chiefs Queue Up To Offer Promises Of Cultural Change

Deutsche Bank - External

Here's the new competition in banking: making the biggest promises for cultural change.

On Monday, Antony Jenkins, the new chief executive of Barclays, was talking about the bank's mistakes in the wake of the Libor scandal and pledging to put them right.

On Tuesday, it was the turn of another top banker, also new to his job, to make promises. Anshu Jain, 100 days into his new role as chief executive of Deutsche Bank, a job he holds jointly with Jürgen Fitschen, said that, with returns to shareholders in decline, "we can't expect our investors to allow us to pay the bonuses we have in the past".

"Highly paid individuals are our biggest cost base" and, in future, the most senior staff at the bank will have to wait for five years to get their bonuses, just to make sure that the performance on which they were based does not evaporate in the meantime.

The Deutsche Bank pair made clear that bonuses were going to come down as they promised to set up a new "compensation standards panel" to look at pay in the current 2012 financial year.

They made their pledge to put themselves at the "forefront of cultural change in the industry" after laying the ground in July for some sort of regulatory action following the Libor scandal, by admitting that some Deutsche staff had been involved in trying to rig the key interest rate.

Barclays has already to set up its committee, chaired by the lawyer-cum-banker Anthony Salz (who is also a director of the Scott Trust, which owns the Guardian), to examine the bank's culture.

However, it is clearly too early to know whether the words being uttered by bankers promising cultural change will translate into action – or, crucially, appease investors fed up with bankers taking too big a share of investment banking revenues.

Powered by article was written by Jill Treanor, for The Guardian on Tuesday 11th September 2012 19.49 Europe/London © Guardian News and Media Limited 2010


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