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Deutsche Bank (DB) CEO's Compensation for 2018 Increases

Zacks Equity Research

Deutsche Bank AG DB has paid its CEO Christian Sewing compensation of €7 million (excluding fringe benefits and pension service costs) for 2018, up considerably from 2017. The higher pay is a reward for improving the company’s performance.

The CEO has been praised for standing up to his duties of developing and implementing a strategic plan, laying down an impressive cost savings target for 2019, stabilizing and improving client satisfaction and employee commitment.

The executive group’s compensation of €55.7 million also came above €29.8 million in 2017, mainly due to rise in variable compensation and decision to increase base salary for some.

However, 2018’s bonus pool was €1.9 billion, down 14% from previous year mainly due to reduction in headcount undertaken by Sewing as a move to cut costs. Notably, the German lender has paid its board members bonuses for the first time in the last four years. 

The highest paid executive is Garth Ritchie, who received a total compensation of €8.62 million in 2018 compared with €3.25 million in 2017. He received a functional allowance of €3 million for being handed with an “additional responsibility in connection with the implications of Brexit”, per the annual report. Another executive, Stuart Lewis, received functional allowance of €1.2 million.

The rise in executive group’s pay is reflective of improvements made in terms of stable balance sheet, return to profitability and the significant progress made to reduce costs and generate higher returns.

Shares of Deutsche Bank have declined 31% over the past six months on the NYSE compared with 4.6% fall recorded by the industry.

The stock currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the same space are Bank Of Montreal BMO, Lloyds Banking Group PLC LYG and Royal Bank Of Canada RY. All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Bank Of Montreal has been raised 1.2% for the current year in the past 60 days. The company’s share price has jumped 14.9% in the past three months.

Lloyds has witnessed 2.4% upward earnings estimate revision for 2019 in the past 60 days. Its share price has risen 28.3% in the past three months.

Royal Bank Of Canada’s shares have gained 11.1% in three months’ time. Its earnings estimate for 2019 have moved up slightly in the past 60 days.

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