Deutsche Bank announced that it will resume paying for the normal bonuses of 2017, said the bank’s chief. Also, according to him, some of their employees will be receiving raises.
John Cryan, Deutsche Bank CEO, welcomed plans in an interview regarding Britain sparing European banks costly capital rules post-Brexit. But he said that the staff is still looking into any possible U.S. tax reform costs.
“We always said that we would return to our normal system of variable compensation in 2017,” Cryan said. “And we will also raise salaries in some areas,” he added with no further details.
Germany’s biggest bank is still currently in its fragile state. This was only highlighted after its report came out wherein almost 25 percent of investment bank revenue fell during the third quarter. It also had a fall of more than a third in its bond trading division.
Aside from the weak earnings, the bank has also been struggling with Britain’s indefinite decision in leaving the European Union.
Deutsche Bank’s bonus payments dropped from 2.4 billion euros a year earlier to 546 million euros in 2016. This happened following a multi-billion dollar legal fine for the sale of toxic debt.
The Bank of England said that it plans to permit large foreign banks after Brexit to operate as branches in Britain. They will be able to do this instead of requiring considerable capital to become subsidiaries.
Goldman Sachs Warning
Goldman Sachs Group Inc. said on Friday that it would be taking a $5 billion earnings hit during its fourth quarter. This is due to the new U.S. tax law submitted and approved by the Senate last December 2017.
Sachs is the first major U.S. bank to provide details on the one-time impact of the law on overseas corporate profits.
The bank also hastened the delivery of stock awards which were granted previously to many of its top executives.
Bank stocks might have rallied due to the tax bill’s lower corporate rates, but the new law still requires charges. These charges will be implemented during the near-term as foreign earnings are faced with taxation and the weakening of the deferred tax value.
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