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Deutsche Bank (DB) CEO Sewing's 2020 Compensation Up 46.4%

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Deutsche Bank DB chief executive officer (CEO) Christian Sewing's total compensation for 2020 climbed 46.4% from the prior-year level, after the bank reported profits of €624 million against loss of €5.3 billion in 2019. His annual salary was increased to €7.37 million from $5.03 million in prior year, according to the company’s annual report.

The CEO’s pay package includes a base salary of €3.12 million and long-term incentive compensation of €1.67 million. Also, he was awarded with short-term bonus of €2.58 million, of which individual component was 87%.

The board cited that the individual component of short-term award is linked to the achievement of short-term and medium-term individual and divisional objectives determined for the board members in 2020.

For 2020, Sewing had targeted to execute Deutsche Bank’s strategy, while respecting the timetable. Also, he had set an objective to foster team spirit and to empower the leadership team. Sewing also developed a bank-wide ESG and sustainable banking strategy. Further, he was successful in delivering on corporate bank and the investment bank growth strategy and in generating sustainable profitability.

Notably, considering the progress made by the bank under supervision of Sewing, outlook for Deutsche Bank has been upgraded by all the three major rating agencies — S&P Global Ratings, Moody’s Investors Service and Fitch Ratings.

Nevertheless, compensation has been decided keeping in mind the impact of pandemic. Thus, the board’s total pay was reduced €4.6 million for 2020.

Our Take

Deutsche Bank has been taking several initiatives to improve its performance. Also, the German lender is betting on the Asia-Pacific region to drive its profitability and expand its operations further. Moreover, cost-saving measures seem encouraging.

The stock has gained 36.9% on the NYSE in the past six months compared with the industry’s growth of 41.6%.

Deutsche Bank currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Compensation Packages for U.S. Banking Giants in 2020

Wells Fargo WFC reduced CEO Charles Scharf’s pay package by 11.7% from the prior-year level, after the bank reported an 83% fall in net income.

Citigroup’s C CEO Michael L. Corbat received a 20.7% cut in his total compensation package for 2020. The decision was taken based on the negative impact of the pandemic on global economic conditions and the company’s involvement in certain legal matters during the year. Also, Bank of America BAC decided to cut CEO Brian Moynihan's pay by 7.5% to $24.5 million due to the impacts of the pandemic.

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