Commerzbank CEO Martin Blessing gave up his bonus for last year and cut the payouts by an average 17% across the firm, warning of higher costs and more pressure on revenue.
Bloomberg reports that the pay reductions, which included lowering the investment banking bonus pool by 20 percent, helped decrease personnel expenses to $5.3bn from $5.6bn in 2011, Commerzbank said in an e-mailed statement Friday from Frankfurt. The low interest-rate environment and non-core asset reductions are curbing revenue, it said.
'We have succeeded in strengthening the capital base and reducing our costs by a significant amount', said Blessing, 49. 'There is a long way to go'.
Commerzbank, in which the government owns 25% after an $24.3bn bailout in 2009, is restructuring its consumer banking unit and cutting as many as 6,000 jobs over the next four years, as it closes its shipping and real estate financing arms. The bank was put on review last week for a possible downgrade by Standard & Poor’s because of concern about the impact of the restructuring on earnings.
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