Management Board Compensation


Base Salary

In 2011, the Management Board members’ annual base salaries remained unchanged to previous year. The ordinary Management Board members´ annual base salary was € 1,150,000 gross each; the annual base salary of the Management Board Chairman was € 1,650,000 gross.

Variable Compensation

The Supervisory Board, based on a proposal of the Chairman’s Committee, determined the variable compensation for the members of the Management Board for the 2011 financial year. The amounts for the bonuses and LTPAs (and where applicable the Division Incentive) were determined for all Management Board members on the basis of the existing compensation system.

Due to the development of the return on equity in the relevant two-year assessment period, the factor in regard to bonus component 1 was about 0.61 while the factor in regard to bonus component 2 was about 0.64.

The Relative Total Shareholder Return as the basis for the calculation of the LTPA in the year 2011 was about 111 % (2010: 93 %; 2009: 99 %). Thus, the average of the last three years (2009 until 2011) was about 101 %. Therefore the payable amount of the LTPA was slightly above the respective target figures.

In exercising its discretionary scope to determine the bonus (and correspondingly the Division Incentive), the Supervisory Board took into account the performance of the bank and the individual divisions in terms of revenues, income, risk, capital strength and liquidity, both in absolute terms and based on the competitive environment. Furthermore, the factors taken into account also comprised the Bank’s further strategic development, the expansion of its market position, the progress of integration within the Group as well as the renown gained in the market through national and international awards. The decision was also taken in consideration of the globally difficult economic environment. Further details are provided in the relevant sections of the Operating and Financial Review.

Compensation (collectively and individually)

In accordance with the provisions of German Accounting Standard No. 17, the members of the Management Board received in the 2011 financial year compensation for their service on the Management Board totaling € 26,444,081 (2010: € 32,434,836). Thereof, € 8,550,000 (2010: € 9,412,500) was for base salaries, € 17,194,081 (2010: € 17,816,227) was performance-related components with long-term incentives and € 700,000 (2010: € 5,206,109) was performance-related components without long-term incentives. In addition, there were other benefits amounting to € 879,591 (2010: € 795,338), so that total compensation of the Management Board members was € 27,323,672 (2010: € 33,230,174).

On an individual basis, the Management Board members received the following compensation components for their service on the Management Board for or in the years 2011 and 2010.



Members of the Management Board

 

Non-performance-related components

Performance-related components

 

 

 

 

without long-term incentives

with long-term incentives

 

 

 

 

 

non-share-based

share-based

 

in €

 

Base salary

immediately paid out

Restricted Incentive Award(s)

Equity Upfront Award(s) (with holding period)

Restricted Equity Award(s) (deferred with additional holding period)

Total

1

Member of the Management Board until September 30, 2010. Due to U.S. tax rules applicable to Mr. Cohrs the vesting of all awards granted to him for the financial year 2010 was accelerated prior to maturity and the awards were immediately taxed. The net euro amount of cash awards was booked into a euro account and the net amount of shares was booked into a securities account both blocked in favor of the Bank. They are subject to the payment and forfeiture conditions which already applied to these awards before their premature vesting.

Dr. Josef Ackermann

2011

1,650,000

100,000

693,139

105,000

3,750,075

6,298,214

 

2010

1,650,000

1,034,322

1,086,038

2,534,089

6,304,449

Dr. Hugo Bänziger

2011

1,150,000

100,000

96,706

105,000

1,424,884

2,876,590

 

2010

1,150,000

523,428

549,599

824,399

3,047,426

Michael Cohrs1

2010

862,500

577,533

606,410

1,350,943

3,397,386

Jürgen Fitschen

2011

1,150,000

100,000

72,530

105,000

1,424,884

2,852,414

 

2010

1,150,000

507,790

533,180

799,770

2,990,740

Anshuman Jain

2011

1,150,000

100,000

248,885

105,000

4,207,384

5,811,269

 

2010

1,150,000

992,752

1,042,390

4,367,413

7,552,555

Stefan Krause

2011

1,150,000

100,000

96,706

105,000

1,424,884

2,876,590

 

2010

1,150,000

539,066

566,019

849,029

3,104,114

Hermann-Josef Lamberti

2011

1,150,000

100,000

96,706

105,000

1,424,884

2,876,590

 

2010

1,150,000

507,790

533,180

799,770

2,990,740

Rainer Neske

2011

1,150,000

100,000

72,530

105,000

1,424,884

2,852,414

 

2010

1,150,000

523,428

549,599

824,399

3,047,426

Total

2011

8,550,000

700,000

1,377,202

735,000

15,081,879

26,444,081

Total

2010

9,412,500

5,206,109

5,466,415

12,349,812

32,434,836

The number of share awards in the form of Equity Upfront Awards (EUA) and Restricted Equity Awards (REA) granted in 2012 for the year 2011 to each member of the Management Board was determined by dividing the respective euro amounts by € 34.04, the XETRA closing price of a Deutsche Bank share on February 1, 2012 (prior year: € 44.42 on February 2, 2011).

As a result, the number of share awards granted was as follows (rounded):

Members of the Management Board

 

 

 

Units

Year

Equity Upfront Award(s) (with holding period)

Restricted Equity Award(s) (deferred with additional holding period)

1

Member of the Management Board until September 30, 2010.

Dr. Josef Ackermann

2011

3,084

110,166

 

2010

24,449

57,048

Dr. Hugo Bänziger

2011

3,084

41,859

 

2010

12,372

18,559

Michael Cohrs1

2010

13,651

30,412

Jürgen Fitschen

2011

3,084

41,859

 

2010

12,003

18,004

Anshuman Jain

2011

3,084

123,601

 

2010

23,466

98,320

Stefan Krause

2011

3,084

41,859

 

2010

12,742

19,113

Hermann-Josef Lamberti

2011

3,084

41,859

 

2010

12,003

18,004

Rainer Neske

2011

3,084

41,859

 

2010

12,372

18,559

In the presentation of the compensation amounts, the following should be noted with regard to the Restricted Incentive Awards.

In accordance with German Accounting Standard No. 17, the Restricted Incentive Awards, as a deferred, non-equity-based compensation component subject to certain (forfeiture) conditions, must be recognized in the total compensation for the year of their disbursal (i.e. in the financial year in which the unconditional payment takes place) and not in the year they are originally granted. This means that the total compensation amounts presented above do not include the Restricted Incentive Awards granted by the Supervisory Board to the Management Board members for 2011 amounting to € 15,081,873, but instead include the first tranche of the Restricted Equity Awards (including an adjustment linked to our return on equity) granted in the preceding year (2010 for the financial year 2009) totaling € 1,377,202.

The following table provides details on the Restricted Incentive Awards on an individualized basis awarded to the members in active service on the Management Board in 2011. The information shown presents the amounts paid in the financial year as well as the amounts originally granted along with the respective financial year the amounts were awarded for.

Members of the Management Board

 

 

 

 

Amounts in €

Year1

Allocation over periods/tranches2

Amount awarded

Amount granted (i.e. paid out) in 20113

1

Financial year the award was originally issued for (in regard to the service on the Management Board).

2

Number of equal tranches.

3

The Restricted Incentive Awards awarded for the 2009 financial year contain a variable component (RoE-linked adjustment) so that the disbursal, i.e. the amount paid out, in the context of the first tranche differs from the amount originally awarded.

Dr. Josef Ackermann

2011

2013 to 2016 / 4

3,750,075

 

2010

2012 to 2015 / 4

2,534,089

 

2009

2011 to 2013 / 3

1,925,000

693,139

Dr. Hugo Bänziger

2011

2013 to 2016 / 4

1,424,883

 

2010

2012 to 2015 / 4

824,399

 

2009

2011 to 2013 / 3

268,575

96,706

Jürgen Fitschen

2011

2013 to 2016 / 4

1,424,883

 

2010

2012 to 2015 / 4

799,770

 

2009

2011 to 2013 / 3

201,431

72,530

Anshuman Jain

2011

2013 to 2016 / 4

4,207,383

 

2010

2012 to 2015 / 4

4,367,413

 

2009

2011 to 2013 / 3

691,210

248,885

Stefan Krause

2011

2013 to 2016 / 4

1,424,883

 

2010

2012 to 2015 / 4

849,029

 

2009

2011 to 2013 / 3

268,575

96,706

Hermann-Josef Lamberti

2011

2013 to 2016 / 4

1,424,883

 

2010

2012 to 2015 / 4

799,770

 

2009

2011 to 2013 / 3

268,575

96,706

Rainer Neske

2011

2013 to 2016 / 4

1,424,883

 

2010

2012 to 2015 / 4

824,399

 

2009

2011 to 2013 / 3

201,431

72,530

Total

2011

 

15,081,873

 

2010

 

10,998,869

 

2009

 

3,824,797

1,377,202

The following table shows the non-performance-related other benefits for the 2011 and 2010 financial years.

Members of the Management Board

Other benefits

in €

2011

2010

1

Member of the Management Board until September 30, 2010.

Dr. Josef Ackermann

176,256

148,723

Dr. Hugo Bänziger

50,535

54,833

Michael Cohrs1

56,218

Jürgen Fitschen

151,700

130,171

Anshuman Jain

63,214

77,671

Stefan Krause

228,878

136,953

Hermann-Josef Lamberti

103,485

91,505

Rainer Neske

105,523

99,264

Total

879,591

795,338

Management Board members do not receive any compensation for mandates on boards of our subsidiaries.

Pension and transitional benefits

The Supervisory Board generally allocates an entitlement to the Management Board members to pension plan benefits. Only the Management Board members who have functional responsibility for the CIB Group Division and receive a Division Incentive do not receive such an entitlement. These entitlements involve a contribution-oriented pension plan. Under this pension plan, a personal pension account has been set up for each participating member of the Management Board after appointment to the Management Board. A contribution is made annually into this pension account. This annual contribution is calculated using an individual contribution rate on the basis of each member’s base salary and total bonus up to a defined ceiling and accrues interest credited in advance, determined by means of an age-related factor, at an average rate of 6 % per year up to the age of 60. From the age of 61 on, the pension account is credited with an annual interest payment of 6 % up to the date of retirement. The annual payments, taken together, form the pension amount which is available to pay the future pension benefit. Under defined conditions, the pension may also become due for payment before a regular pension event (age limit, disability or death) has occurred. The pension right is vested from the start.

Based on former contractual commitments Dr. Ackermann and Mr. Lamberti are principally entitled to an additional monthly pension payment of € 29,400 each after they have left the Management Board.

Furthermore, Dr. Ackermann, Dr. Bänziger and Mr. Lamberti are in principle entitled to a transition payment for a period of six months after leaving office. Exceptions to this arrangement exist where, for instance, the Management Board member gives cause for summary dismissal. The transition payment a Management Board member would have received over this six-months period if he had left on December 31, 2011, or on December 31, 2010, was € 2,825,000 for Dr. Ackermann and € 1,150,000 each for Dr. Bänziger and Mr. Lamberti.

In addition, if Dr. Ackermann and Mr. Lamberti leave office after reaching the age of 60, they are each subsequently entitled, in principle, directly after the end of the six-month transition period, to a payment of first 75 % and then 50 % of the sum of salary and total bonus (last total target figure), each for a period of 24 months. This payment ends no later than six months after the end of the Annual General Meeting in the year in which the Management Board member reaches his 65th birthday.

The following table shows the annual service costs for pension benefits and transition payments for the years 2011 and 2010 and the corresponding defined benefit obligations each as of December 31, 2011, and December 31, 2010, for the individual members of the Management Board. The different sizes of the balances are due to the different lengths of service on the Management Board, the respective age-related factors, the different contribution rates as well as the individual pensionable compensation amounts and the previously mentioned additional individual entitlements.

Members of the Management Board1

 

 

 

in €

 

Service cost for pension benefits and transition payments, in the year

Present value of the defined benefit obligation for pension benefits and transition payments, end of year

1

Other members of the Management Board are not entitled to such benefits after appointment to the Management Board.

2

Due to Dr Ackermann´s planned departure from the Management Board of Deutsche Bank AG after the end of the regular Annual General Meeting in 2012 instead of his departure, as originally planned, after the end of the Annual General Meeting in 2013, the period for the receipt of the transition payment is extended by another year. Accordingly this extended receipt of payments leads essentially to the increase of obligations as stated in the table before.

Dr. Josef Ackermann2

2011

876,760

18,753,007

 

2010

608,720

13,236,187

Dr. Hugo Bänziger

2011

508,011

2,786,879

 

2010

573,444

2,161,491

Jürgen Fitschen

2011

222,585

565,984

 

2010

226,196

307,348

Stefan Krause

2011

470,827

1,345,800

 

2010

500,183

825,181

Hermann-Josef Lamberti

2011

486,920

12,463,973

 

2010

532,496

11,177,275

Rainer Neske

2011

462,655

1,066,022

 

2010

420,559

575,398

Other benefits upon premature termination

The Management Board members are in principle entitled to receive a severance payment upon a premature termination of their appointment at the bank’s initiative, if the bank is not entitled to revoke the appointment or give notice under the contractual agreement for cause. The severance payment, as a rule, will not exceed the lesser of two annual compensation amounts and the claims to compensation for the remaining term of the contract. The calculation of the compensation is based on the annual compensation for the previous financial year.

If a Management Board member leaves office in connection with a change of control, he is also, under certain conditions, entitled in principle to a severance payment. The severance payment, as a rule, will not exceed the lesser of three annual compensation amounts and the claims to compensation for the remaining term of the contract. The calculation of the compensation is based again on the annual compensation for the previous financial year.

The severance payment mentioned above is determined by the Supervisory Board subject to its sole discretion. In principle, the disbursement of the severance payment takes place in two installments; the second installment is subject to certain forfeiture conditions until vesting.

Expense for Long-Term Incentive Components

The following table presents the compensation expense recognized in the respective years for long-term incentive components of compensation not vested immediately granted for service on the Management Board.

Members of the Management Board

Amount expensed for

 

share-based compensation components

non-share-based compensation components

in €

2011

2010

2011

2010

1

Member of the Management Board until September 30, 2010.

Dr. Josef Ackermann

2,020,850

1,743,667

2,152,404

1,078,425

Dr. Hugo Bänziger

440,182

559,896

386,704

150,461

Michael Cohrs1

1,480,333

130,210

Jürgen Fitschen

309,459

286,314

359,601

112,839

Anshuman Jain

1,471,955

1,840,641

1,818,626

387,205

Stefan Krause

364,503

379,403

395,591

150,461

Hermann-Josef Lamberti

434,736

578,987

377,816

150,461

Rainer Neske

314,911

286,314

368,488

112,839

Management Board Share Ownership

As of February 17, 2012 and February 18, 2011, respectively, the current members of our Management Board held the following numbers of our shares and share awards.

Members of the Management Board

 

Number of shares

Number of share awards1

1

Including the share awards Mr. Fitschen, Mr. Jain and Mr. Neske received in connection with their employment prior to their appointments to the Management Board. The share awards listed in the table have different vesting and allocation dates. The last share awards will be allocated in August 2017.

Dr. Josef Ackermann

2012

600,534

296,784

 

2011

560,589

259,596

Dr. Hugo Bänziger

2012

69,849

115,383

 

2011

55,531

100,520

Jürgen Fitschen

2012

181,907

110,978

 

2011

169,008

92,671

Anshuman Jain

2012

552,697

346,703

 

2011

457,192

414,906

Stefan Krause

2012

116,307

 

2011

71,363

Hermann-Josef Lamberti

2012

139,402

114,459

 

2011

125,291

98,626

Rainer Neske

2012

51,088

111,902

 

2011

60,509

90,875

Total

2012

1,595,477

1,212,516

Total

2011

1,428,120

1,128,557

To counterbalance the economic disadvantages for share award owners resulting from the capital increase which took place in September 2010, additional share awards were granted. Each Management Board member who was already appointed in September 2010 received additional share awards of approximately 9.59 % of his outstanding share awards as of September 21, 2010 of the same category (in total 76,767 share awards for all Management Board members together). The respective share awards are included in the number of share awards as presented in the table above.

The current members of our Management Board held an aggregate of 1,595,477 of our shares on February 17, 2012, amounting to approximately 0.17 % of our shares issued on that date. They held an aggregate of 1,428,120 of our shares on February 18, 2011, amounting to approximately 0.16 % of our shares issued on that date.

The number of shares delivered in 2011 to the members of the Management Board active in 2011 from deferred compensation awards granted in prior years amounted to 295,902.

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Deutsche Bank Annual Report 2011

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