Deutsche Bank to Consider Extending Fitschen’s ContractNicholas Comfort
Deutsche Bank AG, Germany’s biggest bank, will consider extending co-Chief Executive Officer Juergen Fitschen’s contract to match that of Anshu Jain.
The chairman’s committee of the supervisory board will propose extending his contract through March 2017 at a board meeting in late October, Frankfurt-based Deutsche Bank said today in a statement on its website.
Deutsche Bank paired the 65-year-old head of operations in Germany with investment banker Jain, 50, last June to bridge its roles as a trading colossus that vies with Wall Street firms and a lender to German companies. The bank is navigating litigation and probes that include allegations it mis-sold products related to U.S. mortgages and may have colluded with other lenders to try to rig interbank lending rates.
“They would like to continue their outstanding work in a partnership in the coming years for Deutsche Bank,” Paul Achleitner, chairman of the supervisory board, said in the statement. “Juergen and Anshu have made numerous important decisions that are positioning Deutsche Bank in the right direction. We know our company is in good hands with them.”
Deutsche Bank rose 0.8 percent to 35.05 euros at 1:49 p.m. in Frankfurt today. The stock has gained 6.4 percent this year, less than the 14.4 percent increase of the Bloomberg Europe Banks and Financial Services Index.
In their first year, Fitschen and Jain focused on shoring up their firm’s capital levels and set aside cash to pay for potential legal costs such as those resulting from the probe into interbank lending rates.
Deutsche Bank boosted its common equity Tier 1 ratio to 10 percent at the end of June, in part because of a 3 billion-euro ($4 billion) share sale in April, from less than 6 percent in 2011, company filings show.
The bank increased litigation reserves to 3 billion euros at the end of June from 800 million euros at the end of September, according to presentations on its website.
Regulators from Canada to Switzerland are investigating whether more than a dozen lenders, including Deutsche Bank, colluded to rig benchmark interest rates including the London interbank offered rate for profit or to mask their true cost of borrowing. Barclays Plc, UBS AG and Royal Bank of Scotland Group Plc have paid a total of about $2.5 billion in fines after admitting wrongdoing.
Deutsche Bank lost a lawsuit today filed by four traders fired as part of the lender’s probe of the rigging of interest-rate benchmarks. Presiding Judge Annika Gey at the Frankfurt Labor Court said the bank must give them their jobs back and pay their salaries.
Deutsche Bank said in July last year that its internal probe cleared current and former management board members of wrongdoing in connection with the rate-rigging scandal. The bank said this July that it has dismissed or sanctioned employees discovered to have acted inappropriately.
Fitschen’s contract is due to expire at the close of the bank’s annual shareholder meeting in May 2015, according to the statement.
The longest-serving employee on Deutsche Bank’s management board, he began his banking career with Citigroup Inc. in Hamburg in 1975, before joining the German lender in 1987 and moving to Asia. Fitschen held positions in Thailand, Tokyo and Singapore.
His time abroad gave him knowledge of foreign markets and experience working with the companies that power Germany’s export-driven economy. He has been head of Germany since 2005.
“We would be pleased to continue to lead the management board of Deutsche Bank together as partners,” Jain and Fitschen said in the statement today.