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Deutsche Bank to spread bank bonus pain

Date: Friday 18 Dec 2009

Germany’s Deutsche Bank plans to spread the impact of Chancellor Alistair Darling’s UK bonus tax among its staff worldwide.

“We will clearly globalise it,” said chief executive Josef Ackermann in an interview with the Financial Times. “If parts [of the cost of the tax] are paid out of the bonus pool, we would seek to globalise it. It would be unfair to treat the UK bankers differently.”

The bank employs about 80,000 people in total with just a tenth based in the UK.
Darling announced his controversial plan in last week’s pre-Budget report.

All bank bonuses of more than £25,000 will attract a one-off tax of 50% to be paid by the bank, not the employee. Darling expects that to raise over half a billion pounds for the Treasury.

Ackermann is critical of the idea. “Bonuses should be the result of supply and demand for skilled people,” he said.

He also warns that investors in the German bank may have to wear some of the hit “We will monitor what [other] banks are doing, how much of the cost will be borne by staff and how much will be taken by shareholders. That is absolutely undecided.”

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